Court Orders Home Sellers to Pay Buyers $40,000 for Delayed Handover
A Israeli court has ordered home sellers in Hadera to compensate the buyers approximately $40,000 (NIS 150,000) for significant delays in handing over the property and for defects discovered within it. The sale agreement, for a property valued at $1.35 million (NIS 4.95 million), was signed in July 2023 by the buyers, who were then French residents.
Both parties filed lawsuits against each other. The sellers claimed the buyers delayed payment for 277 days, constituting a fundamental breach of contract and entitling them to $270 (NIS 1,000) per day in compensation, plus agreed contractual damages. They alleged the buyers manipulated the process to transfer ownership to their names despite not completing the full payment.
The buyers countered that the payment delays were due to bureaucratic issues with their French bank and that one payment was further postponed due to the outbreak of the "Swords of Iron" war, which also led to a refusal of financing. They argued these circumstances did not constitute a breach, especially since they eventually paid the full amount. They sought $87,000 (NIS 320,000) for 320 days of delayed possession, plus contractual damages.
Judge Yifat Unger Bitton ruled that both sides fundamentally breached the contract, with their respective damages largely offsetting each other. She noted the buyers' delay in applying for a mortgage, close to the October 7th massacre, which resulted in the bank's refusal and the need to find alternative financing, was not proper contractual conduct. However, she also found the sellers' self-help measure of withholding the property for 376 days, despite receiving full payment, to be a breach.
Ultimately, after offsetting the agreed damages, the court awarded the buyers $37,000 (NIS 136,220) for the delayed handover and $11,700 (NIS 43,220) for property defects, plus $4,900 (NIS 18,000) in legal costs. The sellers were awarded $62,000 (NIS 227,000) for the delayed payment, but this was offset by the buyers' award.
