We settled our Israeli lawsuit before trial. Do we get the court fee back?

Foreign claimants tend to find out about the Israeli court fee twice: once when they file, and once when a settlement is on the table and someone asks whether the money is recoverable. It partly is. The fee structure in the Courts Regulations (Fees) 5767-2007 was written to reward early settlement, and it draws the line at the end of the third pre-trial session. Reach an agreement before that point and the unpaid half of the fee falls away and part of what you paid comes back. Reach it a hearing later and you fund a trial that never happens.

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Detailed Answer

Regulation 6 sets the shape of the fee on a money claim: 2.5% of the sum claimed, with the first half payable when the statement of claim is filed and the balance payable up to 20 days before the date fixed for the hearing. On a NIS 900,000 claim that is NIS 22,500 in total, NIS 11,250 of it before a lawyer has done anything. Regulation 15 is the relief valve. Where the proceedings end in a compromise before the end of the third pre-trial session, the balance of the fee is refunded, subject to a fixed deduction that the regulations specify. The mechanism rewards a particular sequence, so the practical instruction to counsel is not simply to settle but to record the settlement while the file is still in the pre-trial phase, and to have the court give the agreement the force of a judgment at that stage rather than at a later hearing listed for convenience. Where the claim was filed in the Magistrates Court the fee floor is around NIS 773, and below a certain level the arithmetic of a refund stops mattering. Above roughly NIS 400,000 in dispute it usually decides how hard both sides push for an early meeting.

For a claimant abroad the fee interacts with two other cash demands that arrive in the same period, and the three should be budgeted together rather than met one surprise at a time. The first is security for costs, which Israeli courts order against foreign claimants with some regularity. The second is the expert fee, whether a party opinion or a court appointed one. Our answer on legal aid and court fee exemptions for non-residents covers the exemption route, which has to be applied for with the statement of claim rather than afterwards, and our answer on security for costs against a foreign claimant covers the deposit that often lands within weeks of service.

In Practice: Under Regulation 6 of the Courts Regulations (Fees) 5767-2007 the fee on a money claim is 2.5% of the amount claimed, half on filing and the balance up to 20 days before the hearing date, with a Magistrates Court floor near NIS 773. Regulation 15 refunds the balance where the case ends in compromise before the end of the third pre-trial session, less a fixed deduction. The refund is paid by the Courts Administration (Hanhalat Batei HaMishpat) to the account named in the application, and a non-resident should expect six to twelve weeks from the application to the credit reaching a foreign account, which is why the claim should be made in the same breath as the settlement rather than months later.

When to Consult a Lawyer

• The settlement is agreed near the third pre-trial session, because whether the consent judgment is entered at that hearing or the next one is worth thousands of shekels and it is a scheduling decision, not a legal one.
• The claim was inflated at filing to preserve headroom, since the fee is calculated on the amount claimed and an early amendment downward is cheaper than a refund argument later.
• You are settling from abroad and no Israeli bank account exists to receive the refund, which needs arranging before the application rather than after the court has approved it.

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Speak With an Israeli Attorney

We structure settlements so the fee refund under Regulation 15 is still available, apply for the refund on your behalf, and arrange for it to reach an account outside Israel.

Contact us for a confidential initial consultation.