By Itzhak Dannon /
Businessman Yosef Manor filed suit in Tel Aviv District Court seeking NIS6.5 million (about $1.75) in compensation from Aviv Algor of Ramat Hasharon and Ian Nigel Davis, who resides in London.
The suit alleges that Algor and Davis are relatives who conducted business activity through a private holding company initially registered in Israel as “3I Investments” and later changed its name to “Pituah Arvot Hanegev Vehashfela” (i.e. Negev and Coastal Plain Development). This company had a subsidiary known as “Vita Pri HaGalil.”
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The introduction to the suit claims that the actions and omissions of the defendants amount to fraud, misrepresentation, negligence and bad faith in the implementation of a contract. It is also alleges that the holding company is in fact a corporate shell through which the two act in their individual capacities.
According to Manor, he was persuaded by Algor to he invest capital and made various agreements with the holding company. One such agreement, says Manor, was for the purchase of the stocks of the Vita Pri HaGalil subsidiary. Another agreement, claims the plaintiff, gave him an option which, in effect, allowed him to compel the holding company to repurchase the shares of the subsidiary.
Manor, at one point, sought to properly exercise his right according to the terms of the option agreement. However, when the time for compliance arrived, the company, through Algor and Davis, refused to uphold its obligations, using, he maintains, false pretexts and excuses which were fraudulently utilized to deceive him.
According to Manor, arbitration was subsequently undertaken between him and the company. According to the unequivocal findings of the arbitration, Manor says, the company was obligated to pay him over NIS10 million (about $2, 700, 000), an amount which was never paid. He also asserts that one of the express finding was that arbitration determined that Algor and Davis acted in bad faith to prevent him from exercising his option because it was not profitable for them; that they had no intention of carrying out the option agreement since, on the date of the exercise the market value of the shares at issue was significantly lower than the price the company was required to pay under the agreement.
Manor opines in his lawsuit that Algor and Davis should compensate him to the amount of NIS11 million (just under $3 million), together with the amount determined in the arbitration decision. However, due to the uncertain financial ability of the defendants he limited his claim to NIS6.5 million, but he reserved the option of amending the complaint, so as to reflect his full damages, if and when circumstances justified it.