I won a judgment against an Israeli company in a US court. Can I enforce it in Israel?

An American supplier wins in the Southern District of New York, sends the judgment to the Israeli defendant, and receives nothing. That is the normal outcome, and it is not defiance. Section 2 of the Foreign Judgments Enforcement Law 5718-1958 says a foreign judgment is enforced in Israel only in the manner that statute provides, so until an Israeli court has spoken, the New York order is a piece of paper with no purchase on a single shekel in a Tel Aviv bank.

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Detailed Answer

Section 3 sets four conditions that must all be met before an Israeli court will declare the judgment enforceable: the foreign court had jurisdiction under the law of its own state, the judgment is no longer open to appeal, the obligation it imposes is enforceable under Israeli law on the enforcement of judgments and its content is not repugnant to public policy, and the judgment is executory in the state that gave it. Section 4 adds reciprocity, which is satisfied where the foreign state would enforce an Israeli judgment; no bilateral treaty is needed, and US judgments are enforced in Israel routinely. Section 5 imposes a five-year deadline from the date of the judgment, subject to a different agreed period or special reasons the court accepts, and it catches more creditors than any other provision, because American plaintiffs often spend three or four years chasing US assets before turning to Israel. Section 6 then hands the debtor five defences: that the judgment was obtained by fraud, that there was no reasonable opportunity to present a case, that the court lacked competence under the rules of private international law applied in Israel, that the judgment conflicts with another judgment already valid between the parties, and that a claim on the same matter was pending in an Israeli court when the foreign action began. Punitive and treble damages attract particular scrutiny under the public policy limb, and it is common for an Israeli court to enforce the compensatory part of an award and refuse the multiplier.

The mechanics reward preparation from abroad. You file a motion in the District Court supported by an exemplified copy of the judgment, apostilled in the state where it was given, a notarial Hebrew translation, and an affidavit of US law addressing finality, appealability and the foreign court's jurisdiction. The respondent has thirty days to reply, and where it does the case becomes a contested proceeding on the Section 3 and Section 6 questions rather than a rehearing of the merits. Section 11 offers a separate and often cheaper route where you need the judgment recognised rather than executed, for instance to establish a status or a finding relied on in other Israeli proceedings. Two things are worth doing before you file. Check the Companies Registrar for the debtor's current status and directors, since a company that has been struck off or is in liquidation changes the whole strategy, and consider whether the claim reaches beyond the company, as discussed in our answer on a director's personal liability in an Israeli company. Then plan the collection stage, because a declared judgment is only useful if there is something to seize, and the mechanism is the one described in our answer on attachment of an Israeli bank account.

In Practice: The application is made to the District Court under Section 3 of the Foreign Judgments Enforcement Law 5718-1958, must be filed within the five year window in Section 5, and carries a court fee of approximately NIS 1,141. The respondent's reply is due within 30 days, and a contested application typically takes 8 to 24 months to judgment, with Israeli legal fees of NIS 40,000 to NIS 90,000. Once the declaration is made, Section 10 puts the judgment on the same footing as an Israeli one, and an Execution Office (Hotzaa LaPoal) file can be opened immediately, with attachment orders on bank accounts and registered assets served the same week.

When to Consult a Lawyer

• Your judgment was entered in default. Section 6(2) is written for exactly that case, and the debtor will argue it was never properly served under the rules of its own jurisdiction, so the service file needs assembling before you file, not after.
• The award includes punitive damages, statutory multipliers or attorney fee shifting. Israeli courts sever these, and how the motion is drafted determines whether you recover the compensatory core or lose the application as a whole.
• The Israeli company has transferred its business to a newly registered entity with the same shareholders. That is a fraudulent transfer claim under Israeli law and has to be brought as its own proceeding, usually with a temporary attachment applied for at the same time.

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Speak With an Israeli Attorney

We assess the judgment against Section 3 and the Section 6 defences before you spend anything, prepare the affidavit of foreign law and the apostilled record set, and move straight from the declaration into execution so the debtor has no window to move assets.

Contact us for a confidential initial consultation.