Case: The plaintiff (=pl) was in debt a few hundred thousand NIS for years. Hotza’ah Lapo’al (the enforcement arm of the court system) carried out a public auction to sell pl’s apartment (a converted storage room with multiple building violations), with a large part of the sale’s proceeds going to creditors. The defendant (=def) had the winning bid (1.12 mil. NIS) in 11/19, a purchase confirmed by the courts in 01/20, after pl failed to convince them that he would be able to pay the debt in another way. Soon after the court’s final approval of the sale, pl found a donor to reimburse def for the purchase of the house. Def said that he would consider returning the apartment, but then refused, saying that the person who financed the purchase already sold property to make it possible. Pl demands the apartment back with the following claims: the price paid was ona’ah (unfairly low); as the owner, pl had the first right to buy the property from the court (dina d’bar metzra); def cannot back out of his oral agreement to undo the sale (mechusarei amana): pl’s mother, who does not owe money, is the apartment’s true owner.

Ruling:
This week we will deal with the main issue, which pl calls dina d’bar metzra.

This case is not governed by bar metzra, which means that a seller should give the first chance to buy to a neighbor, who can maximize benefit, and after the fact, the neighbor can transfer the sale to him. Here we are not talking about a sale, but taking the property as payment of a debt. There too there are halachot of lifnim mishurat hadin, but that is called shuma hadar, i.e., the debtor who had his property taken can pay the debt with money and get his property back (Bava Metzia 35a). In this case, pl’s claim may be even stronger because pl demanded his property before def took full control.

P'ninat Mishpat (682)

Beit Din Eretz Hemda - Gazit

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669 - Did the Owner Exhaust his Opportunities? – part I

670 - Did the Owner Exhaust his Opportunities? – part II

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The classic case of shuma hadar is when the creditor himself took the property as payment, so he can be told, "The debtor is giving you the money you deserve, so why should you keep his property?" The gemara says that if the creditor sold the property to someone else before the debtors request, the debtor cannot claim it from the buyer, because of the latter’s specific interest in it.

How do we treat our case, where the buyer did not buy it from the creditor but from the debtor, through the court’s intervention? Logically, the reason to not say shuma hadar applies, as def had interest in buying this property (see Dei Hashev, p. 65). There are sources (including Shut Beit Ephrayim, Choshen Mishpat 58) which speak about avoiding ani mehapech bacharara (preempting someone with precedence from acquiring). However, that does not apply here because pl had several opportunities to obviate the need to have his apartment sold, so that pl cannot have claims against def.

Therefore, def is not required to return the apartment to pl. According to one dayan, because there is a good chance that def received a particularly good price, he bought the apartment as an investment, and he might have not given pl as much opportunity to get it back as he should have, def is recommended to voluntarily allow pl to get it back with a modest profit for def.