P'ninat Mishpat: A Seller with Questionable Rights to the Property – part I | Beit Din Eretz Hemda - Gazit | Beit Midrash

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Case: Multiple plaintiffs (=pl), each paying different amounts, bought land from a company (=def1), owned by def2, dealing with land sold by Arabs, in the periphery of a yishuv. Def1 was also supposed to handle the registration of the property in pl’s names. Years went by without the deal being completed, so pl demanded their payment back according to par 5.6 of their contract. Although a different document states that pl cannot get their money back, it was never signed, and the signed one says that it supersedes other agreements. Pl claims that def violated their agreement by not advancing it over years. More fundamentally, the sale should be void because pl was misinformed, as def has not provided any proof they own the property they purported to sell. Def1 claims they have 25% holdings in the company (=comp2) that arguably has rights to the property (the subject of court cases), but there is no record of def1’s portion in comp2, which makes it a very suspicious claim. Def1 responds that he is very close with comp2’s owner, so there is no need for official records of his rights. Pl also claim that even comp2’s rights seem out-of-line with what def2 assured pl. Def1 counters that the nature of their operation is to deal with complex legal cases, as pl knew, and they should have done as much research as they wanted. [We will discuss other elements of the dispute in future weeks.]

Ruling: Since the document that the sides signed states that all other agreements are void, even if the unsigned one could have been relevant, it is not consequential. Actually, though, even the clause in the unsigned document only absolves def from payment if they try and do not succeed to sell their rights to a third party.
Regarding grounds for a refund, the fact that def1 has not succeeded in years to transfer ownership to pl is not grounds for breach of contract. The nature of this niche of property acquisition in Yehuda and Shomron is arduous and speculative, and pl did not prove that def1 did not go about it seriously. Regarding comp2’s rights to the land, it is true that def was unable to provide strong evidence, but they did provide some indications, and it is possible that according to Jordanian law, which applies here, it may suffice. Therefore, pl has not proven a mekach ta’ut (erroneous purchase) based on this alone.
However, what is sufficiently indicative of mekach ta’ut is that def1 was requested and warned several times to substantiate his claim of a share in comp2 and did not do so. The Rosh (Shut 107:6) rules that a litigant’s failure to provide information beit din seeks when he is presumed to have it is a strong indication that his claim is contradicted by what he is withholding. The claim of a close relationship between def2 and the owner of comp2 was not proven. Even if it were, a buyer should not be expected to rely on such trust between his seller and the possible owner of rights. Thus, there are multiple reasons to consider the purchase a mekach ta’ut.
We continue with more next time.