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Shabbat Parashat Acharei Mot Kedoshim 5778

P'ninat Mishpat: Place of Jurisdiction

(based on ruling 77027 of the Eretz Hemdah-Gazit Rabbinical Courts)

Case: The plaintiff (=pl), a resident of Israel, and the defendant (=def), a resident of the US, jointly established a company in 2008 and registered it in Israel in 2009, with each of them holding shares. Def became the CEO in 2009. There is a financial dispute between the sides, with the following claims. Pl claims that def illegally diluted the company’s stocks and misled pl into investing hundreds of thousands of dollars, and pl wants compensation for that. Pl is also suing for pay for the work he did for the company. Pl sued def in our beit din, whereas def demands that adjudication be held in a beit din in the US. Pl argues that most of the company’s workers are in Israel, as is its legal headquarters. Def argues that as an internet company, there is no headquarters and a significant number of workers work in the US, including def himself, so that the adjudication should be there.      

 

Ruling: The general rule is that when the plaintiff and the defendant are from different locations, adjudication is held in the defendant’s location (Rama, Choshen Mishpat 12:1). Many poskim (including the Rashba II,344 and Maharshdam Choshen Mishpat 103) say that when the work upon which the dispute is focused was in a certain place, the defendant cannot refuse to adjudicate there. In this case, though, most of the interaction between the sides took place when each one was located in separate countries.  

Rav Yisraeli (Mishpetei Shaul 42) explains the Rashba based on the assumption that the defendant will have to, in any case, come to the plaintiff’s place due to his resources there, in which case he has no excuse not to adjudicate there. However, in this case, def’s holdings in Israel are small compared to the scope of the adjudication, and so this is not a reason to hold the adjudication in Israel.

The Maharashdam focuses more on the adjudication being in the place that the sides decided to conduct their business. In this case, in contrast, def did not come to Israel to do the negotiations. Acharonim dispute (see opinions of Rav Eliyahu and Rav Yisraeli in Mishpetei Shaul 40) what happens if the dealings happened in the plaintiff’s place, but were held by representatives of the defendant. However, here in any case, def said that he himself signed the papers in the US. Furthermore, it is accepted to apply the Maharshdam only to cases in which both sides’ residence was in the same place and the defendant moved out later.

Although Rav Yisraeli (ibid. 42) said that the batei din in Israel have a status of makom hava’ad (a judicial center), to which cases should be brought when possible, that is only in regard to matters in which the Rabbanut batei din have special jurisdiction. It does not apply to cases where adjudication will be based on arbitration law. While pl cites an opinion that the reason to adjudicate in the defendant’s place is for the concerns of the plaintiff to be able to receive payment, that opinion is not accepted. We note that in this case, should there be payment, it would be taken from def’s resources in the US. Therefore, adjudication should take place at a beit din in the US.   

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Dedication

We daven for a complete and speedy refuah for:

Leah Rachel bat Chana

Meira bat Esther

Rivka Reena bat Gruna Natna

David Chaim ben Rassa

Lillian bat Fortune

Yafa bat Rachel Yente

Eliezer Yosef ben Chana Liba

Ro'i Moshe Elchanan ben Gina Devra

Together with all cholei Yisrael

 

Hemdat Yamim is dedicated

to the memory of:

those who fell in wars

for our homeland

Eretz Hemdah's beloved friends

and Members of

Eretz Hemdah's Amutah

Rav Shlomo Merzel z”l
Iyar   10

Rav Reuven Aberman z"l

Tishrei 9 5776


Mr. Shmuel Shemesh  z"l
Sivan 17 5774

R' Eliyahu Carmel z"l 

Rav Carmel's father

Iyar 8 5776


Mrs. Sara Wengrowsky

bat R’ Moshe Zev a”h.

   Tamuz 10   5774


Rav Asher Wasserteil z"l

Kislev 9 5769

R' Meir ben

Yechezkel Shraga Brachfeld z"l


R ' Yaakov ben Abraham & Aisha

and

Chana bat Yaish & Simcha

Sebbag, z"l


Rav Yisrael Rozen z"l
Cheshvan 13, 5778

 

 Rav Benzion Grossman z"l
Tamuz 23 5777

Hemdat Yamim
is endowed by Les & Ethel Sutker
of Chicago, Illinois
in loving memory of
Max and Mary Sutker
and
Louis and Lillian Klein, z”l

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