The Jerusalem Magistrate Court has recently ruled that an accompanying bank for a construction project bears no liability to Sub-Contractors, in case the developing company becomes insolvent. The verdict was given in a case filed by S. Angel Architects ("Angel") against Bank Leumi and against the supervisor on the bank's behalf, at the Neveh-Haopera Project, which was executed by Arie and Ofer Company in Modiin. According to Angel, the developing company created false representations to the bank's supervisor. The representations alleged that there was a real progress in the construction process. The Bank's supervisor then, authorized the Bank to release millions of shekels from the construction loan account. According to Angel, the bank negligently released the funds to the company, which in turn, became insolvent and thus lacking the monies due to Angel. The court denied Angel's claim and agreed with the bank, represented by Adv. Assaf England and Efrat Hinnitz from the Hamburger Evron law firm. The court ruled that in the matter before him, the bank could not be held liable since: "there was no kind of contractual relationship between the bank and the Sub-contractor. According to the practice and the literature, the bank's duty of care towards third parties is limited, and the bank would be held liable towards Sub-contractors and third parties only under special circumstances, which this case did not present." |
Our Legend
Hamburger Evron & Co. was founded in 1928 by the late Adv. Arie Hamburger.
Since the 70's, the firm was headed by the late Adv. Amnon Evron, who was recognized as one of the leading lawyers in Israel in the fields of commercial law, and was renowned as an expert lawyer and a gifted litigator. In addition to his legal activities, Adv. Evron was a member on the board of the international Arthur Rubinstein Voluntary association, and was a board member of the new Israeli opera association.
