Debt of more than 127,000 shekels erased: Enforcement office in an exceptional decision
After paying over 56,000 shekels on an original debt of only 17,000, the elderly woman's debt ballooned to 127,000 shekels due to interest. A precedent-setting decision by the enforcement office changed everything.
The enforcement officer Yehiel Noizitz from the Rishon LeZion office ordered the cancellation of the entire remaining debt of a 74-year-old widow, which amounted to 127,331 shekels, and the closure of the consolidation file managed against her. In 2004, two enforcement files were opened against the debtor for debts to the Holon Municipality - one for 14,825 shekels and the second for 3,118 shekels, for a total of 17,943 shekels.
During the 22 years that have passed since then, the debtor paid 56,210 shekels - more than 313% of the original debt, but due to accumulated interest, the debt continued to grow and stood at 127,331 shekels. The debtor, a 74-year-old widow with three adult children, deals with a complex medical background supported by documentation.
Her monthly income is 5,606 shekels, including work caring for the elderly in the amount of 2,300 shekels and survivor and old-age pensions in the amount of 3,306 shekels. Over the years, she has faced severe losses - the death of her husband in 2012, the death of a son, and another son's drug addiction. Despite the many difficulties, she met her obligations for over ten years and did not stop paying even during the most difficult periods.
On June 16, 2025, the creditor submitted its response regarding the reduction of interest and late fees and noted in its objection that interest is treated as the debt itself for payment, relying on the Local Authorities Law (Interest and Linkage Differentials on Mandatory Payments) 1980.
Officer Noizitz discussed on his own initiative, by virtue of the Enforcement Law, the reduction of interest in the consolidation file. His decision is based on Amendment 75 to the Enforcement Law and Amendment 9 to the Adjudication of Interest and Linkage Law that came into effect on January 1, 2025, which significantly expand the powers of the enforcement officer to reduce interest.
The main changes include a separation between base interest intended to maintain the value of money and late fees intended to incentivize the debtor to pay, preventing the addition of late fees to the debt to avoid a "snowball effect," and expanding the officer's discretion to reduce interest.
The decision stated:
"We are dealing with municipal debt files to the Holon Municipality which bear linkage and interest according to the Local Authorities Law (Interest and Linkage Differentials on Mandatory Payments), 1980. I cannot accept the creditor's claim that interest is treated as the debt itself for payment. Furthermore, I reject the claim that there is no authority to order the reduction of interest which is an integral part of the debt. It should be noted that Amendment 75 to the law expanded the officer's powers and granted him broad discretion to reduce even 'base' interest. This authority also applies to statutory interest of local authorities, and is not limited only to contractual interest or those awarded by the court".
In his decision, the officer referred to special reasons that accumulated to justify the cancellation of the debt, including the debtor's difficult personal and medical circumstances, the long period of 22 years of payments, the lack of other open enforcement files, the lack of assets to realize, and the fact that the remaining debt consists of interest only, since the debtor paid over 300% of the original debt.
