Agreements - Cancelling Agreements

Question:

Why is it so difficult to cancel a property relations agreement which has been authorized by court ?

Answer:

It is extremely difficult to cancel a property relations agreement that has been authorized by court for judicial policy reasons. If it were easy to cancel agreements authorized in court then the authorization requirement in the Spouses’ Property Relations’ Act of 1973 would lose its value, and be meaningless. Couples need to rely on the declaration made by them that they signed the agreement having read it, and with a full understanding of its contents, its meaning and consequences. These points were made clear in the Koch leave of appeal case in the eighties where it was said that it was doubtful that a property relations agreement between a couple that had been authorized in court could be challenged, unless an appeal was being made about a fault in the authorisation process.

Question:

My husband and I made a divorce agreement which was authorised at the family court. I was the one who initiated divorce and agreed to a fairly modest financial deal just to avoid a long court battle. However, when we went to the rabinnical court for the divorce ceremony he went back on his word to give me a divorce and co-operate on this. He tried to exploit the situation by refusing to give me the ‘get’ unless I agreed to additional terms in his favour. Am I stuck with the terms of the agreement now , or can I cancel it and file for divorce, custody, maintenance and a property settlement ?

Answer:

If a Jewish couple make a comprehensive divorce agreement and the financial and custody aspects of it are duly authorised at the family court , if one of the sides refuses to co-operate with the actual ‘get’ process, even though they undertook to do so, this constitutes ‘a fundamental breach of contract’. It will entitle the other side to ask the court that authorised the agreement to cancel it. It should be stressed that a party cannot enforce the other side’s ‘consent’ to divorce even if it appears in the divorce agreement. This is because under Jewish law a ‘get’ must be freely given and freely accepted.

In a case in the eighties, the Supreme Court of Justice rejected a petition by a wife against the decision of the District Court ( the forerunner of the present family court) to cancel its judgment authorising the financial aspects of the couple's divorce agreement . It had done so because she had refused to honour her undertaking in their divorce agreement to accept a ‘get’ from her husband. She suddenly conditioned her acceptance on him offering her additional financial advantages. The wording of the agreement had said:

The Supreme Court of Justice agreed with the District Court. It also viewed her behaviour as a ‘fundamental breach of contract’ which entitled the husband to apply for the cancellation of the agreement which it had authorised and given the validity of a judgment.

Question:

Can delay in filling for cancellation of an agreement which has been authorized in court reduce the chances for success ?

Answer:

Certainly, as action to cancel an agreement which has been authorized by court must be made within a reasonable time ! The Supreme Court of Justice stressed this very point in August 2007 when it refused a man permission to appeal against a Haifa District Court judgment upholding a family court judgment refusing to cancel a divorce agreement it had previously authorized.

In this case the man had waited for over a year to file for cancellation of the agreement, after he and his wife had divorced, and most of the financial aspects had been carried out. Evidence showed hat he regretted missing his opportunity in the agreement to buy out his wife's share of the family home. He was acting in bad faith and just trying to delay its sale by applying to cancel the agreement, which was authorized at a time when he was represented by a lawyer, it held.

Question:

Can one cancel a "bad" divorce agreement which has already been authorized by court on the grounds that one was mistaken or misled as to one's legal rights ?

Answer:

In theory, yes, but in practice this is extremely hard to do. As well as proving the difficult grounds of cancellation relating to mistake and misrepresentation under the Contract Law (General Part) of 1973 , one must meet the even higher standard required to cancel a court-authorised divorce agreement. Divorce agreements have a special nature and status. Before a court will authorize one and pass judgment, it must ask both sides , in accordance with the 1973 Spouses' Property Relations Act, if they fully understood the contents of the agreement and its consequences and signed it of their own free will, not through fear or threat.

These points were emphasized by Tel Aviv Family Court in February 2005, when dealing with a woman's plea to cancel her divorce agreement. It quoted Supreme Court precedent, stating: "A divorce agreement is not like a usual agreement, …. it includes giving up things that often seem bad objectively…..", and continued :" Beside the individual's interest in ending proceedings there is a public interest in the ending of the debate and a recognition that agreements of this type cannot be cancelled easily."

Rejecting the plea to cancel the divorce agreement, the family court held that the plaintiff had failed to prove that , in the circumstances, she had been mistaken, or misled and entered into the agreement as a result. On the contrary, it found that she was very aware of her rights. She had been represented by a lawyer, and had been actively involved in both the plea she had filed in connection with her property rights , and negotiations which lasted for over a year. She had probably been mistaken as to how "worthwhile" the deal was, which is not a ground for cancellation.

Question:

Can a husband go back on his word and take back a gift of the family home to his wife by claiming that he was at a low emotional ebb when he signed an irreversible power of attorney , and was under pressure when he made this concession ?

Answer:

If the granting of rights in the property was within the framework of a property relations or divorce agreement , then the husband would probably not be entitled to rescind his gift, because when the court authorizes these agreements it must check that both sides understood the terms and implications , and signed of their own free will. This is a condition of its authorization, and the granting of the agreement the validity of a judgment .

If, however, the husband just signed the power of attorney, outside of a framework of an agreement, and the change of ownership has not yet been registered at the Lands Registry, then it may be possible to stop the transfer of rights, if he can prove that he was under pressure or not functioning properly at the time.

Question:

Can a divorce agreement that has been authorized be cancelled because one of the parties is mentally ill?

Answer:

This may be possible if it is proved that the party was mentally ill at the time, the agreement is extremely one-sided, and he/she was not represented by a lawyer. However, before a court authorizes a divorce agreement with financial provisions it is under a duty to make sure that the parties fully understand its provisions, and their implications. Each case must be decided on its own merits

In August 2007 the Supreme Court rejected a claim by a man that his divorce agreement should be cancelled because his mental condition prevented him from fully understanding the terms of the agreement. It held that he had failed to prove any connection between his alleged mental deterioration and his signing of the court-authorised agreement which he claimed was unfair to him. He had been represented by a lawyer when he signed the agreement, and had stated that he did not want a guardian appointed , or to be declared as lacking legal capacity. Criticising his behaviour, it held that the family court had established that he had fully understood the agreement when he signed it and it was authorized , and he had only acted to cancel it over a year later, when it no longer suited him.

Question:

When someone claims that he is entitled to cancel an agreement because he was forced or compelled to sign it, when will he be justified in doing so ?

Under the 1973 Contracts Law (General Part) an agreement may be cancelled if one side is forced or compelled into making it. This constitutes a basic fault in its formation and allows him to cancel it. Caselaw has fleshed out this definition to make it apply only the most extreme situations which interfere with the freedom of choice to enter into a contract or not. Where a reasonable alternative exists, this cannot be claimed. The burden of proving force or compulsion lies with the person claiming it.

Question:

Can delay in notifying the other side of cancellation of a divorce agreement be, in itself, grounds for failure of an action to cancel it ?

Answer:

Yes ! Under the Contracts Act (General Part) 1973 a party wishing to cancel an agreement due to duress must notify the other side within a reasonable time . Even if duress/force was exercised at the time of the signing of the agreement, if the side wishing to cancel it did not notify the other of this within a reasonable time, the action would fail on this ground alone. So ruled Tel Aviv Family Court in a case where around 5 years had elapsed from the time the agreement was signed, and authorised - and the plea for its cancellation had been filed . The court held that comments recorded in the protocols of hearings prior to the authorization of the agreement , where the Plaintiff had said that he was considering making a notice of cancellation, were insufficient. The notification of cancellation had to be clear, though the filing of the plea itself could be regarded as a notification. As no notification of cancellation had been made prior to filing of the plea itself , the plea was rejected because it was made too late.

Question:

I feel I signed an agreement to sell my home which exploited me. I am a widow, with poor Hebrew and little experience of business or the property market. I sold my home to my brother-in-law. Can I cancel the agreement ?

Under the 1973 Contracts Law (General Part) an agreement may be cancelled if there is a basic fault in its formation. Exploitation , if proved, is regarded as a basic fault. Three elements must be proved – firstly, the existence of an extreme situation of distress or weakness (mental, physical or lack of experience), secondly, the exploitation of this by the other side, and finally, a very one - sided business deal.

Case:

In my divorce agreement my husband agreed to buy my part of the family home and undertook to bring payment on the day of the divorce ceremony at the rabbinical court. We got divorced – but he never brought the cheques. He has carried on making excuse after excuse ever since. What legal steps can I take ?

Answer:

It is possible to file a plea for the cancellation of the part of the divorce agreement

relating to the family home because the ex-husband never kept his contractual obligation to pay for his ex-wife’s part of the property at the time stated. This omission to pay on time represents a fundamental breach of contract under the 1973 Contracts Law (General Part) , for which the ex-wife is entitled to cancel the part of the divorce agreement relating to the apartment.

Question:

Can a divorce agreement that was authorized by court and incorporated into a judgment but was never implemented because the couple remained together be cancelled because of a substantial change in circumstances ?

Only if the enforcement would result in injustice and its cancellation would prevent injustice, the Tel Aviv Family Court held in June 2003.

In that particular case the court rejected a plea by a wife to cancel a divorce agreement and appendix authorized by a district court and incorporated into a judgment in 1984. According to the appendix, each party had the right to file for divorce and if the other party refused to co-operate he/she faced sanctions. In 1995 they made a joint application for a divorce , stating that they had already reached a settlement about property. However, they did not act on it and remained living together until 2000 when the husband left her , and filed for divorce at the rabbinate. The wife objected and filed for specific accommodation there.

The Family Court rejected the wife’s argument that a deterioration in her health constituted a substantial change of circumstances which warranted cancellation of the agreement. It said that implementation of the divorce agreement would not result in injustice, pointing out the real reason for the wife’s refusal to divorce was “ just because the apartment will be sold and she will not be able to live there alone. This reason is clear in the announcement she filed to the rabbinical court in her plea for specific accommodation….”

Editor’s Note:

Cheated Beneficiary Files For Cancellation of Inheritance Agreement

Question:

I am a beneficiary under a will. I feel that the executor of the will has cheated me. He told me a sob story about there being more expenses than anticipated on the deceased’s estate and as a result I agreed to accept less than I should have got under the will. I later discovered that he was a major beneficiary and that the sob story he told me didn’t apply. Can I do anything about all this ?

Answer:

Yes, it is possible to file for the cancellation of the agreement based on misrepresentation/fraud and mistake, which are grounds for cancelling an agreement under the 1973 Contracts (General Part) Act. It will be necessary to prove to the court that the executor of the estate actually misled the beneficiary into believing that a particular state of affairs existed (relating to the hefty expenses) and that as a result of this mistaken belief he signed the agreement. The fact that the executor is a major beneficiary under the will shows that there is a conflict of interests. In such circumstances, the executor should have asked the court for instructions or approval of any agreement.