Tel Aviv Homeowner Discovers Property Owned by Municipality After 65 Years, Sues for 26 Million Shekels
A homeowner in the upscale Neve Tzedek neighborhood of Tel Aviv recently uncovered that the house he purchased 29 years ago was actually expropriated decades earlier and registered under the ownership of the Tel Aviv municipality. The property, located on Tertsiu Street, is a ground-level house on approximately 300 square meters including a storage room and yard. The expropriation notice was first issued by the state in September 1961, with further steps taken in 1974 and formal registration of the expropriation under the municipality’s name in 1984. However, these details were concealed from the buyer by both the Israel Land Authority and Tel Aviv municipality.
The original landowner likely knew of the expropriation but passed away, and his widow sold the property unaware of its status. In 1997, the plaintiff bought the house for $350,000, a price reflecting the market at the time and indicating he was unaware of the expropriation. Despite the property being registered to the municipality since 1984, it remained listed under the seller’s name in the land registry, allowing the seller to register a warning note and initiate ownership transfer proceedings. The buyer only discovered the true ownership in 2019 when attempting to sell the house and was unable to obtain a proper registration extract.
In 2022, after contacting the municipality, the plaintiff was informed of the property's registration history. He alleges that the state failed twice: first by not closing the property’s registry after expropriation, and second by not enforcing the expropriation. The lawsuit claims the state’s land registration authority acted negligently, creating false representations contrary to reality. Additionally, when the plaintiff tried to register the property in his name, the municipality did not disclose its ownership and required him to commit to paying a future betterment tax upon sale or development.
The plaintiff is suing the Israel Land Authority and Tel Aviv municipality for 26 million shekels in compensation. He is represented by attorneys Moshe Raz Cohen and Drorit Shapir from Raz Cohen Frashker & Co.
