Court Rules Against Firm Over Altered Check, Awards Damages in Separate Claim
A business dispute between two Israeli earthworks companies, Bnei Fuad Asli and Tzach Nahum Earthworks, ended with a mixed verdict from the Hadera Magistrate's Court. The core of the conflict involved a NIS 80,187 check, the last of three totaling approximately NIS 240,000, issued by Tzach Nahum to Asli. The first two checks were cashed without issue, but the third was allegedly post-dated incorrectly from January 30, 2023, to 2024. Tzach Nahum claimed Asli altered the date without authorization and subsequently canceled the check. Asli then pursued collection through the Execution Office, which Tzach Nahum contested.
During legal proceedings, Asli's representation initially asserted the check was unaltered. However, Asli's manager later provided conflicting affidavits, first suggesting a Tzach Nahum representative made the change, then claiming the owner of Tzach Nahum himself was responsible. Under cross-examination, the manager admitted the check was altered but could not recall who did it, stating he had "forgotten" the details initially. Conversely, Tzach Nahum's manager testified he attempted to prevent the error upon discovering the incorrect date, a version supported by voice messages where an Asli employee discussed the date error and sought approval for a correction. The employee who participated in these messages did not testify.
Judge Yaniv Heller found Asli's shifting account "questionable at best" and deemed Tzach Nahum's version more credible, concluding that an Asli representative altered the check. Citing Section 64 of the Bills of Exchange Ordinance, which invalidates a bill with a material alteration to the payment date made without the debtor's consent, the judge dismissed Asli's claim based on the check entirely.
Despite losing the check dispute, Asli also filed a separate NIS 130,663 claim for services and materials provided but not paid for. Tzach Nahum contested this, alleging unsigned delivery documents and that cheaper materials were supplied than billed. The court found discrepancies in Tzach Nahum's claims regarding authorized signatories and noted that both companies' accounting records largely aligned, indicating an outstanding debt to Asli. The judge ruled in favor of Asli, awarding the full NIS 130,663.
Tzach Nahum also filed a counterclaim for NIS 165,000, alleging defamation due to the bounced check and subsequent freezing of its accounts, which they claimed harmed their reputation. The judge dismissed this claim, stating that legal proceedings, including debt collection and account freezes, are considered "privileged publication" under defamation law. Furthermore, since Tzach Nahum was found to owe money to Asli, the judge ruled there was no basis for compensation for initiating a legitimate collection process, even if the method was flawed. Tzach Nahum failed to provide objective evidence of business damage. The judge concluded that Tzach Nahum's own actions, not Asli's, had damaged its reputation.
