Assessment Error Leads to 2.5 Million Shekel Debt

Ten property owners in Hod HaSharon learned the hard way how expensive a clerical error can be. The story began in 2005, when a group of landowners signed a partnership agreement to regulate land originally designated for a development zone under an old mandatory plan. The appellants purchased rights between 2006 and 2013 in units of 160 sqm each.

In subsequent years, two plans were approved that significantly increased the land value: one changed the designation to residential, commercial, and public areas, and the second was a consolidation and subdivision plan, allocating the appellants a 780 sqm plot for a five-story building with ten housing units. In practice, a permit for a seven-story building was approved, along with several easements.

In August 2023, the appellants received a betterment levy assessment of 122,500 shekels, which the document stated referred only to the easements, noting that payment for the two plans had been settled previously. The appellants paid and received the building permit in March 2024. However, in June 2024, they received a new payment demand for 2,583,840 shekels for the betterment created by those two plans, as the previous registration was deemed a mistake by the committee's appraiser.

The District Appeals Committee for Planning and Construction, chaired by Adv. Maya Ashkenazi, rejected the appellants' arguments. The committee distinguished between an error in the essence of the work (whether the levy was paid) and a professional error within the assessment. As it was the former, it was not an illegal correction, but a new betterment levy assessment issued for the first time.

The committee also rejected the reliance argument, ruling that general claims about approaching banks and contractors are insufficient without concrete evidence of changed positions. Furthermore, it determined that the 2005 agreement included all characteristics of an organized purchasing group—such as a coordinating lawyer, mandatory architectural firm, and lottery mechanism—disqualifying the appellants from an exemption. The appeal was rejected in full, leaving the landowners with a debt of over 2.5 million shekels.