Enforcement of Judgments 2022 Comparisons

There are several options available to identify the judgment debtor's asset position, before commencing court proceedings or before commencing enforcement proceedings. These include the following:

• The bankruptcy and insolvency registry – this can be used to examine whether an individual or a company is subject to any form of insolvency process or subject to any related orders.
• The Israeli companies' registry – various information on companies, such as attachments imposed on a company's assets, its shareholders and their holdings, the names and addresses of its directors, etc, is publicly available via the companies' registry.
• The lien registry – information regarding liens on non-real estate property or rights to real estate not registered in the land registry of individuals and companies may be publicly available via the lien registry.
• The non-paying debtors registry of the Israeli Enforcement and Collection Authority – information regarding declarations of individuals as non-paying debtors, indicating that the individual is or was a party to execution proceedings and did not meet the imposed payments as required.
• The land registry – if the opposing party is presumed to own a certain land plot or any other real estate, a party can confirm this information by accessing the public land registry and checking whether that plot is indeed owned by the opposite party. The land registry also includes information regarding mortgages and other interests regarding real estate assets.

Another option includes commencing court proceedings which would allow a party to receive information not otherwise available.

Attachment order

During the course of the proceedings (and even prior to commencing the claim), a party may seek an interim attachment order, aimed at a third party which is believed to hold assets or monies owned by an opposing party, or which the opposing party may have a right to receive in the future. The applicant is not required to prove the third party indeed holds such assets; however, it is required to specify the nature of the assets the applicant believes are held by the third party (for example, an attachment application aimed at a law firm as a third party can seek an attachment for all monies the firm holds as a trustee for the defendant), unless the order is aimed at financial institutions (where a general attachment application will suffice).

The third party would then be required to reply as to whether they hold any assets owned by (or owed to) the party responding to the motion. If they so confirm, an attachment may be imposed on the assets specified in the motion, until after a judgment is rendered. Thus, the applicant will not only confirm information on the opposing party's assets, but may also secure, or increase the chances for, the enforcement of any judgment obtained.

A court order imposing an attachment will usually be given subject to the following conditions:

• the alleged cause of action in the main claim is sufficiently supported by prima facie evidence;
• the "balance of convenience" must be in favour of the applicant (ie, the harm to the applicant, should the order not be granted, outweighs the harm which may be caused to the respondent should the order be granted, and when relevant also outweighs the harm caused to a third party or to a public matter);
• there is a reasonable concern that satisfying a judgment in the case would be substantially burdensome should the order not be given;
• no other remedy of lesser harm could achieve the purpose of the attachment order.

Furthermore, after a judgment is rendered, the judgment creditor may commence execution proceedings (see 2.2 Enforcement of Domestic Judgments under Judgment execution proceedings). The judgment creditor may then request that the judgment debtor be summoned to a "financial ability investigation", which would determine the debtor's financial capability to satisfy the judgment. The judgment creditor may have a right to be present in this investigation, as well as to receive information regarding the debtor's assets obtained during such investigation.

Judgments under Israeli law may differ in the remedy they grant the plaintiff, for example: injunctions, specific performance orders, declaratory reliefs, and pecuniary reliefs.

Also, judgments may differ in the period of time in which they may be in force, for example the following:

• Temporary ex parte order – first granted on an ex parte basis, relying on prima facie evidence, and remains in force at least until an inter partes hearing takes place.
• Interim order – often given on the basis of prima facie evidence in support of a plaintiff's main claim, usually requires hearing both parties' claims, and remains in force until further deliberation in the main claim itself; however, an interim attachment order and an Anton Piller order are usually given ex parte, and the defendant may file a motion to revoke the order.
• Final judgment – given after deliberation in the main claim, and remains in force indefinitely unless an appeal is filed and granted; once the deadline to file an appeal has passed, a final judgment becomes unappealable. A judgment may be subject to a statute of limitations defence after 25 years if the creditor did not take any actions to advance its performance.

There are several options to enforce a domestic judgment in Israel. These can be divided into guaranteeing the fulfilment of a judgment ex ante (before it is rendered), or acting to enforce the judgment ex post (after it is rendered).

Prior to Final Judgment

Interim injunction order

Before a final judgment is rendered, the plaintiff may apply to receive an interim injunction order which would prohibit the defendant from performing any transaction relating to certain assets or funds during the proceedings or until further order of the court.

These interim orders are obtained by filing the appropriate motion to court, and may be granted ex parte as a temporary order until further deliberation.

Attachment order

It is possible to obtain an attachment order whereby the defendant cannot make any transactions relating to assets owned by him and subject to the order (eg, real estate assets) or whereby a third party has to maintain within its position (ie, not transfer to the defendant) assets which are held by such third party but belong to the defendant or are owed to the defendant from that third party.

An attachment may apply to funds or assets indebted to a defendant (a potential future judgment debtor) held by third parties, or to assets owned by the defendant, whether they are held by third parties or by the defendant. Also, the attachment can remain in force until a judgment is rendered, and may later allow the court or execution authorities to order the sale of the attached assets to secure the performance of the judgment.

This is achieved by filing a motion, within the proceeding (or even before filing the claim), to impose an attachment on the defendant's assets, including those held by third parties, such as banks and other financial institutions, as well as any other third party which may hold any assets in which the defendant has any rights or claims.

The applicant is not required to prove that any of the third parties named in the motion in fact hold any assets of the defendant (but with regard to third parties which are not financial institutions, the applicant is required to specify the nature of assets he believes are in their possession), and may file the motion based on the possibility and belief that such third party may hold any such assets.

The attachment order is given ex parte and served to the relevant third party, which is then required to state whether it indeed holds any assets, towards which the defendant may have any rights.

If the order is granted, an attachment is imposed on the monies or assets held by the third party and they may not be paid or transferred to the defendant without the court's permission.

In cases where the attachment is imposed upon any movable or non-movable assets, the third party will not be allowed to transfer the assets to the defendant, and the defendant must not sell or otherwise grant rights to a third party with regard to such assets, until the judgment is satisfied and the attachment is removed. If the asset at issue is also subject to any government registry regarding ownership of assets (eg, cars or real estate), the existence of an attachment will be registered in such registry.

In cases where the attachment is imposed upon funds, the defendant will not be entitled to receive them as long as the attachment is in place.

After a judgment is rendered, the attachment continues to apply to the relevant asset/monies until the judgment is satisfied. Also, once a judgment is rendered, the execution procedure applies (see Judgment execution proceedings further in this section). This means that the asset may be sold and the returns used to satisfy the judgment.

Receivership

A plaintiff may be able to apply to the court seeking the appointment of a receiver over the defendant's assets. This application may be on an interim basis, therefore assisting to safeguard the asset in question as long as the proceedings take place.

Such an order may be considered if an attachment is deemed insufficient to safeguard the defendant's assets and funds to satisfy later judgment (for example, if the court deems it probable that the defendant may attempt to dissipate his assets, thus becoming judgment-proof, before a judgment is rendered).

If the motion is granted, the court will appoint and authorise a receiver to perform specific actions (such as to enter the defendant's premises or to seize, hold and manage an asset).

After a judgment has been rendered and the defendant has been found liable, the court may authorise the receiver to sell the assets and to use the returns to pay off the judgment debtor's debts.

Following Final Judgment

Judgment execution proceedings

If the judgment debtor has not satisfied a judgment within 30 days from the day it was rendered (or a different deadline set by the court), the judgment creditor may apply to execute the judgment via the bureau of execution. This applies both to a pecuniary judgment and to a specific performance order.

The judgment creditor may instigate execution proceedings even if an appeal on the judgment is pending, as long as a stay of execution order has not been granted.

The execution registrar (a state-appointed person, authorised to make judicial decisions relating to execution of judgments) may order a warrant of seizure and sale of assets owned by the debtor in order to satisfy the judgment.

Once an execution motion has been filed, the judgment debtor is required to act according to one of the following alternatives:

• Pay the debt in full, within 20 days.
• Request a payment plan (in this case they will be required to prove that they do not have the financial ability to pay the debt in full), within 20 days.
• Request a "financial ability investigation", which will determine the judgment debtor's ability to pay the debt (and will decide on a payment plan if necessary), within 21 days. Note that a corporation may not be subject to a financial ability investigation. A financial ability investigation may also be initiated independently by the execution registrar, or at the request of the judgment creditor.

If the debtor was found to be able to pay the debt, but does not act accordingly, he might be subject to numerous additional sanctions, including the following:

• A stay of exit order, barring the debtor from leaving the jurisdiction.
• Declaration as a limited client by the bank, rendering the debtor unable to use checks or unlimited bank accounts.
• Limiting or prohibiting the debtor's credit card use.
• Preventing the debtor from establishing a corporation or becoming a substantial stakeholder in a corporation.
• Listing the debtor in the registry of non-paying debtors (a publicly available registry; see 1.1 Options to Identify Another Party’s Asset Position).
• An attachment on various assets, which may be carried from an earlier order granted in court proceedings, or imposed independently by the execution registrar, including towards third parties – if the judgment debtor does not pay their debt, the attached assets may be later auctioned and the returns used to satisfy the judgment. Some assets may not be attached, eg, devices or animals which the debtor needs due to any disability; clothes; medical equipment; and other various basic living needs of the debtor and his/her family, and so on.

The judgment debtor may appeal to lift an attachment by filing a motion to the execution registrar; by paying his debts entirely; by agreeing on a payment plan with the judgment creditor (and then filing an appropriate motion to the execution registrar, with the creditor's agreement); or by appealing the execution registrar's decision to the court.

The aforementioned and following relate to civil judgment debtors. Separate execution proceedings, which include more severe sanctions (such as, in some cases, imprisonment), exist with regard to alimony debtors.

Contempt of court proceedings

A creditor may also instigate contempt of court proceedings against a judgment debtor for failure to comply with a judgment or court order (often considered, for example, where there has been a breach of an injunction or a specific performance order). Sanctions for contempt of court include a monetary fine or, in rare cases, imprisonment.

While applying pressure on the debtor, contempt proceedings do not directly guarantee the judgment's satisfaction, and therefore do not replace execution proceedings. Also, contempt proceedings are limited to cases where the judgment creditor has no other options to enforce the judgment; therefore, the court will usually deny motions regarding contempt proceedings where the creditor may initiate execution proceedings (for example, in enforcing pecuniary judgments).

The costs involved and length of time taken for enforcement will vary depending on the circumstances and complexity of the case, on the course of action chosen by the judgment creditor and on the degree of opposition manifested by the judgment creditor.

In execution proceedings, for example, the procedure – and as a result, the relevant deadlines the debtor is subject to and the length of time for enforcement – varies depending on several parameters, such as the nature of the judgment (civil or alimony judgment), the debtor's ability to pay his debt (whether proven, presumed or absent), challenges and motions filed by the debtor, the extent of the ability to identify assets owned by the debtor, and other factors.

The various sanctions mentioned above usually cannot be imposed on a debtor before an official warning has been furnished to him by the execution registrar, and six months have passed. Thus, execution proceedings can often extend over significant periods.

It is therefore worth considering, where there is a concern that the defendant may not satisfy the judgment, filing a motion to impose an attachment on the defendant's assets before a judgment is rendered. If granted, this may assist in protecting the judgment creditor's interests later on.

The judgment debtor may be summoned for a “financial ability investigation” by the execution registrar.

At the end of this procedure, the registrar will determine whether a judgment debtor is able to pay his debt, and his financial ability for satisfying the debt.

If the judgment debtor does not co-operate with the financial ability investigation, the execution registrar may issue an information order to various institutions which may have information on the judgment debtor's assets (eg, the national social security authority; the insolvency supervisor; the census registry; the companies' registry; the motor vehicle registry; the real estate registry; mobile service providers; credit companies; banks and insurance companies, etc).

If it is found that the judgment debtor has an asset or a source of income that may be used to satisfy the judgment, the judgment creditor may be entitled to receive information obtained by the order.

The judgment debtor may challenge the enforcement of a judgment by claiming that he is no longer required to satisfy the judgment, for various reasons which came into place after the judgment was rendered. For example, the judgment debtor may argue that he already satisfied the judgment, and therefore does not owe anything to the debtor; that the limitation period which applies to the judgment has passed; that he has reached a settlement with the judgment creditor; that his debt is subject to an offset; etc.

Often, when such a challenge is raised, an evidentiary hearing will take place before the execution registrar on that matter. The judgment debtor may raise this claim at any point during the execution procedure.

The execution registrar may deliberate on this claim as long as it concerns facts and legal claims formed after the judgment was rendered. The registrar may further order a stay of execution until this claim is decided.

A judgment granting declaratory relief may not be enforced by itself. However, if a defendant acts contrary to the declaration, a plaintiff may commence new proceedings on the basis of the court's declaration and defendant's conduct, and then seek to enforce an operative judgment in those new proceedings.

There is no official public judgment registry in Israel. If one knows the case number of a specific case involving a specific defendant, one can usually locate the judgment on the judiciary docket, available publicly (unless the case is confidential). Furthermore, private databases of judgments are available subject to payment, but do not necessarily include all judgments and decisions.

Under Israeli law, a judgment of a foreign court would generally be declared as enforceable in Israel in accordance with and subject to the provisions set out in the Enforcement of Foreign Judgments Law (1958).

The types of civil judgments which can be enforced in Israel include pecuniary judgments, specific performance orders and injunctions (only as final orders), and judgments granting multiple/punitive damages.

The conditions specified in the Enforcement of Foreign Judgments Law for the enforcement of a foreign judgment are that:

• the judgment was given by a foreign court that, according to Lex Fori, was authorised to render it;
• the judgment is unappealable (an alimony foreign judgment may be enforced even if it still appealable, if the court deems it just and fair, and if the rest of the conditions specified above and below are met);
• the judgment is executable in the jurisdiction in which the judgment was rendered;
• the judgment is enforceable under Israeli foreign judgment enforcement law, and the judgment's content is not contrary to public policy;
• the judgment is subject to the reciprocity rule, ie, was rendered in a country in which according to its laws an Israeli judgment of a similar kind could be enforced.

Finally, a court will not grant a motion to declare a foreign judgment as enforceable if it was filed over five years after the foreign judgment was rendered, unless an extended period was agreed in a treaty between Israel and the country in which the judgment was rendered, or if the court finds other special circumstances which justify extending this period.

If a foreign judgment grants only a declaratory relief, meaning there is no in personam order to enforce, it may be recognised in Israel, either directly or incidentally. If a party then acts contrary to this foreign judgment, it may be used as a basis to instigate proceedings in Israel towards that party. The conditions for direct recognition are that:

• a treaty with a foreign country applies to such judgment (Israel is a signatory to bilateral treaties with the UK, Austria, Spain and Germany);
• Israel has agreed in such treaty to acknowledge such judgments;
• the obligation does not apply to judgments other than judgments which are enforceable under Israeli law;
• the judgment complies with the terms of the treaty;
• the conditions detailed in 3.6 Challenging Enforcement of Foreign Judgments shall also apply here.

Alternatively, the court may incidentally recognise a foreign judgment, within deliberation in a matter under its authority (and only for the sake of the matter under discussion), even if the above conditions are not met.

Criminal, administrative or fiscal foreign judgments will not be enforced.

The procedural requirements for the enforcement of a foreign judgment in Israel encompass the following:

• Filing an application with the Israeli court to declare that a foreign judgment is enforceable. The application is required to include an affidavit to support the facts stated in it.
• The respondent may file a response within a specific period of time (according to current civil procedure regulations, 20 days; though extensions are usually liberally granted). If a response is filed, a hearing – likely including an evidentiary hearing – will take place. Otherwise, the court may decide on the motion without a hearing.
• Once the court declares the judgment as enforceable, the judgment may then be enforced via the enforcement mechanisms mentioned in 2. Domestic Judgments as if it were issued by an Israeli court.

Applying to declare a foreign judgment as enforceable in Israel is a relatively straightforward process, which entails the payments for legal fees to an Israeli attorney and paying court fees (usually several hundred dollars).

Time will then depend on how quickly the court deals with the motion and whether the opposing party elects to file a response.

If a response objecting to the enforcement is not filed, the process should not take more than three to six months. If an objection is filed, and depending on the nature of the objection (legal, factual or both) and its merits, the process may take a significantly longer period, possibly two to three years.

A party may challenge the attempt to declare a foreign judgment as enforceable in Israel, on the basis of proving one of the following:

• The judgment was obtained by fraud.
• No reasonable opportunity was given to the defendant to present his/her arguments and to produce his/her evidence before judgment was rendered.
• The judgment was given by a court which was not competent to render it according to the private international law applied in Israel. A person will not be considered as having submitted to the jurisdiction of the foreign court issuing a judgment against them solely on the basis of presenting oneself in court and:
1. challenging the court's jurisdiction;
2. arguing for a discontinuance or a stay of the proceedings;
3. appealing for the release of assets seized or expected to be seized, or other protection thereof.
• The judgment contradicts a previous judgment given in the same matter between the same parties, that is still valid.
• At the time the action was brought before the foreign court, a suit in the same matter and between the same parties was pending before a court or a tribunal in Israel.
• The foreign judgment's enforcement may prejudice the sovereignty or security of Israel.

If the opposing party successfully proves any of the above conditions, the foreign judgment will not be declared enforceable in Israel.

Domestic arbitral awards in Israel must first be approved by the court, before they can be enforced via execution proceedings.

The award creditor may seek approval of the arbitral award subject to Article 23 of the Arbitration Act (1968) (hereinafter – the “Arbitration Act”).

The award debtor may object to the award's approval in court, by either appealing the award (though an appeal will be possible only if the arbitration agreement allows for an appeal, and even then the grounds for an appeal are very limited) or filing a motion to revoke it (within 45 days), where the grounds for revocation are also very limited (and none of which allow for substantial claims, but rather procedural claims). The award debtor may do so before or after the award creditor filed his motion for approval (but not after the award has been approved).

Foreign arbitral awards are also required to be approved by the court, but do not require the award's approval in the forum in which it was rendered first. Israel is a party to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958, which also became part of Israeli internal law. The award creditor may seek approval of a foreign judgment subject to the conditions specified in the New York Convention (see Articles II–IV). The award debtor may object to the award's approval in court by filing a motion to revoke it (see Article V).

Courts in Israel are generally inclined to enforce arbitral awards, and rarely revoke awards rendered in usual circumstances.

The main variation which should be mentioned is between local and foreign arbitral awards. Local awards are usually approved via the Arbitration Act (and rarely revoked on the recognised grounds specified therein), and in regard to foreign awards – these are usually approved via the New York Convention considerations, which, as mentioned in 4.1 Legal Issues Concerning Enforcement of Arbitral Awards, were adopted and became part of Israeli domestic law.

The starting point when considering whether an arbitral award will be enforced is to consider the form of the award and whether it meets the requisite criteria for enforcement.

Domestic Awards

There are several specifications regarding an arbitral award; namely, it must be rendered by an arbitrator appointed by or under an arbitration agreement, and must apply to a subject which can be subject to an agreement by the parties (for example, a matter which raises questions of a constitutional nature or a matter which raises questions relating to a person's legal status – eg, whether they are married, whether their adoption is legal or not, etc – and these cannot be decided by an arbitrator and must be decided by the authorised court).

Foreign Awards

In terms of enforcing a foreign award, if a particular convention or statute applies to the enforcement, the award must meet the requirements of that convention or statute (Article 29A of the Arbitration Act). For example, for a New York Convention award to be enforced in Israel, the award must meet the New York Convention’s requirements.

Enforcing an arbitral award in Israel requires filing an application for approval to the appropriate court (ie, the court of competent jurisdiction according to the subject or amount of the arbitration). The application is made under Article 23 of the Arbitration Act.

Once approved, the award is regarded as a judgment of the court, except for appeal proceedings.

Such an application will need to include a supporting affidavit, as well a copy of the award. This application may not be made ex parte.

The opposing party (ie, the award debtor) will then have the right to apply to revoke the arbitral award or to object to its approval. This application must be based on one of the grounds specified in the Arbitration Act (see also 4.6 Challenging Enforcement of Arbitral Awards under Domestic Awards) or, in regard to a foreign arbitral award, on the relevant convention's requirements (usually, the New York Convention).

Applying to approve an arbitral award is a relatively straightforward process. Costs and time will then depend on how quickly the court deals with the application and whether the opposing party applies to revoke or objects to the approval of the award.

If a response objecting to the approval of the arbitral award is not filed, the process should not take more than three to six months. If an objection (or a motion to revoke the arbitral award) is filed, and depending on the nature of the objection and its merits, the process may take a significantly longer period, possibly one to two years.

Domestic Awards

At the request of a party, a court may revoke an arbitral award or return it to the arbitrator in the following instances, where:

• (1) no valid arbitration agreement was in place between the parties;
• (2) the award was rendered by an arbitrator who was not duly appointed;
• (3) the arbitrator acted without authority, or deviated from the specific authority granted in the arbitration agreement;
• (4) a party to the arbitration was not given the proper chance to raise its claims or to provide its evidence;
• (5) the arbitrator did not decide on one of the matters brought to his/her decision;
• (6) the arbitration agreement stipulated that the arbitrator must provide reason to his award, and he/she did not do so;
• (7) the arbitration agreement stipulated that the arbitrator must decide according to the law, and he/she did not do so;
• (8) the award was rendered after the period it could be rendered in;
• (9) the award is contrary to public policy;
• (10) any cause that could be used to revoke a final, non-appealable judgment.

If a party's application to revoke the arbitral award is denied, the arbitral award will be automatically approved by the court.

Furthermore, the award debtor may appeal the arbitral award, in accordance with the agreed appeal mechanism (Clause 29B of the Arbitration Act), as follows:

• If the parties agreed that the arbitrator must rule according to the law, they may agree (in advance – in the arbitration agreement) that the award will be appealable upon leave from the court, if the award errs fundamentally in the application of the law. Should leave be given, the appeal will be heard according to the procedure pertaining to an appeal on a court's judgment.
• Alternatively, the parties may agree (also in advance as expressed in the arbitration agreement) that the award will be appealable to an arbitrator. Under this appeal mechanism, an application to revoke the award may only be based on the grounds recognised in articles (9) and (10) listed above.

Foreign Awards

Unless there is a recognised ground for refusing enforcement, courts are bound to recognise foreign awards under the New York Convention. The grounds for refusal to recognise and enforce a foreign award include the following:

• a party to the arbitration agreement was under some incapacity or the arbitration agreement was not valid;
• proper notice of the appointment of the arbitrator or the arbitration proceedings was not given (or the other party was otherwise unable to present their case;
• the award deals with a difference not contemplated by or not falling within the terms of the submission to arbitration or contains decisions on matters beyond the scope of the submission to arbitration;
• the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties or, failing such agreement, with the law of the country where the arbitration took place;
• the award has not yet become binding on the parties, or has been set aside or suspended by a competent authority of the country in which, or under the law of which, it was made;
• the matter was not capable of settlement by way of arbitration or it would be contrary to public policy to recognise or enforce the award.