Fallout from Underground Encroachment – part III

Based on ruling 71018 of the Eretz Hemdah-Gazit Rabbinical Courts

Case: Defendant #1 (=def1) built a house next to a lot owned by defendant #2 (=def2). His sewer pipe went partially under def2’s property. In 1998, def1 and def2 signed an agreement whereby they would exchange property so that def1 would get the land over the pipe, but the agreement was never taken to the land authority for implementation. The plaintiff (=pl) bought def2’s plot and built a house on it – not along the lines of the property exchange. As pl’s house was being built, in 2004, the parties made a basic agreement by which pl would do landscaping as he likes on top of most of the pipe. Pl claims that the presence of the pipe raised the cost of his development. Additionally, the sewer is faulty and has more than once gotten clogged and leaked, giving off horrible smells; this causes his property to devalue. Pl demands the removal of the pipe and/or compensation for various elements of more than 200,000 shekels. Def1 claims that the land exchange was binding and that def2 asked as a favor not to report it right away to the authorities and that pl was told about the situation before buying the lot. Def2 says that he changed his mind on the land transfer the day after signing that agreement and that it is probably not possible to carry it out legally. He told pl about the problem and demands that pl finish payment for the house and adjudicate with def1. Pl responds that since the contract states that the property is free of any other parties, def2 is in breach of contract and does not yet deserve the final payment.

P'ninat Mishpat (704)

Various Rabbis

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511 - Fallout from Underground Encroachment – part II

512 - Fallout from Underground Encroachment – part III

513 - Mold Damage to a Rented Apartment

Load More

Ruling: We have seen that the 1998 agreement was not binding but that there was implied 2004 agreement that def1 could keep the pipe as is in exchange for compensation was effective.

Since it is clear that there was agreement to keep the pipe as is and there is doubt about the level of compensation, the burden of proof is on pl. However, as a general rule (see Rama, Choshen Mishpat 246:17) and based on what we know of the negotiations between the sides in 2004, it was certainly not meant to be for free.

Pl’s claim that def1 gave a virtual carte blanche for any expenses, which they claim is some 200,000 shekels, is implausible. Pl admits that def1 could have moved the pipe in 2004 for 60,000 shekels (there are indications that it was possible for 20,000 shekels). It was not proved that the ground height at which pl chose to build his house was due to the existence of the pipe. In fact, during 2005-6 there was no indication that pl planned to make a major claim against def1; apparently acrimony between the sides that arose in 2007 is responsible for the present large claim.

The main basis of the compensation we award pl is the price of the land that def1 is using according to the price at the time of agreement. We added modest appraisals of actual related expenses. The amount is 20,000 shekels.

There is no excuse for pl to withhold final payment to def2. Any negotiations with def1 should have been dealt with at the time of the sale, and def2 did his part by being up-front on the matter.