Shabbat Parashat Vayeishev 5779

P'ninat Mishpat: Delay in Providing Documentation

Case: The plaintiff (=pl) bought an apartment for 463,000 shekels from the defendant (=def) under a contract with normal requirements from the sides, including dates of payment, transfer of possession, and providing of necessary documentation to the other side. One of the documents that def was supposed to provide was a letter of intent from the mortgage bank, stating the terms under which the lien on the apartment would be lifted. She failed to provide this letter by the time prescribed. Pl claims that this delay caused the following damages: 7,500 shekels difference in the mortgage pl was able to get, as mortgage rates went up before he was able to secure one; 2,500 shekels for a delay in being able to rent out the apartment; varied other small expenses involved in taking care of the matter. Additionally, the contract ascribes $50 a day for delays in fulfilling its terms. Def admits the delay but explains that she was out of the country and was not aware that the delay was of importance to pl. She also notes that she allowed def to move in to the apartment before he had paid the full amount spelled out to receive control. Def also complains that because pl has not finished paying municipal fees, it has not been possible to transfer official ownership, which pl has used as an excuse to withhold the final 30,000 shekels.

Ruling: Regarding the $50 payment for the delay, pl is misrepresenting the contract, which calls for such a fine only for delay in transferring possession of the apartment. It is true that control is supposed to be transferred when a host of responsibilities are taken care of, including completing necessary paperwork. However, it is clear that the control itself is the issue. Considering that def was nice enough to allow pl to move in before he had paid the requisite amount, such a claim is not in good faith.

Regarding the more expensive rate of mortgage that pl was forced to accept, we calculated the damage, which comes to 1,233 shekels (not 7,500). However, pl does not deserve damage payment because of the following considerations. His behavior (we will skip details in this forum) demonstrated that he did not impress on def that receiving the document at the appointed time was important to him, and that it indeed was not a priority of his. Furthermore, the payment of the bulk of the cost of the apartment, in which pl was significantly late, is worth more money than that.

It was possible for pl to have rented out the apartment after receiving control even if all the paperwork was not complete. Therefore, the delay in renting it out is not def’s doing. The only damage that def should compensate pl for is for the 60 shekel fee of reapplying for a mortgage.

Pl must pay municipal taxes immediately, finish the transfer of ownership, and make the final payment.

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