Case details: File 516/11 | Supervisor of Land Registration, Tel Aviv | Supervisor Oren Silverman | May 2, 2012 | Defendant No. 3, A.G. Helem Ltd., was represented by Adv. David Sofer and/or Adv. Irit Hadar.
Background to the Dispute
The proceedings concerned a building at 26 HaBarzel Street in Tel Aviv, situated on Parcel 641 in Block 6638. The building had not yet been registered as a condominium, and the rights of its owners were governed by a contractual framework that included a co-ownership agreement regulating, among other matters, signage on the building.
A sign for the “Moses” restaurant, which leased premises from Defendant No. 3, had been installed on the building’s exterior. The plaintiff sought to install its own sign and approached a representative of Defendant No. 3, but its request was not approved.
The plaintiff subsequently applied to the Tel Aviv Municipality, obtained a permit for the sign and installed it. Within several hours, however, the sign was removed by the building management company at the request of representatives of Defendant No. 3.
At the outset of the proceedings, the plaintiff sought, among other remedies, the removal of signs installed without the consent of all rights holders or, alternatively, the reinstatement of its own sign. It later withdrew its demand concerning the restaurant signage, leaving the dispute focused on its claimed right to display its own sign.
What Was in Dispute?
The plaintiff argued that it should be permitted to install signage on the building and relied, among other things, on the fact that other businesses had been allowed to display signs.
Defendant No. 3 argued that signage rights could not be considered separately from the co-ownership agreement entered into by the rights holders. That agreement contained express provisions concerning the location of signage and the conditions under which it could be installed.
What Did the Supervisor Decide?
The Co-Ownership Agreement Was Central to the Decision
The Supervisor considered the claimed right to install the sign in light of the contractual arrangements governing the rights holders in the building.
The co-ownership agreement contained specific provisions regarding signage, including that exterior signage was to be located on the commercial floor rather than the office floors, that its location was to be determined by the project architect, and that the approvals specified in the agreement were required.
The plaintiff failed to establish that the conditions required under the agreement had been satisfied in relation to the sign it sought to install.
The Municipal Permit Did Not Itself Create a Contractual Right to Install the Sign
It was undisputed that the plaintiff had obtained a permit from the Tel Aviv Municipality and had actually installed the sign.
The Supervisor held, however, that this did not establish compliance with the conditions agreed between the rights holders under the co-ownership agreement. Accordingly, the municipal permit alone was insufficient to establish the plaintiff’s claim.
The Comparison with Businesses on the Commercial Floor Was Rejected
The Supervisor also rejected the plaintiff’s attempt to establish its right by relying on signage permitted to other businesses in the building.
The decision gave weight to the fact that the co-ownership agreement expressly contemplated signage on the commercial floor, where those businesses operated. By contrast, the plaintiff’s proposed sign did not relate to a business operating within that commercial framework.
The Supervisor accepted the explanation that the purpose of the arrangement was to allow businesses on the commercial floor to display signage near their place of operation, rather than to create a general signage right for every rights holder in the building.
The Bad-Faith Argument Was Rejected
The plaintiff also argued that the refusal to permit its sign had been made in bad faith.
The Supervisor rejected this argument. The decision referred to considerations including the desire to avoid excessive signage and preserve the appearance of the building, as well as the fact that the signage restrictions formed part of the contractual framework binding the rights holders.
Significance of the Decision
The decision illustrates the importance of contractual arrangements between rights holders in a building when determining how common areas may be used and where signage may be installed.
In this case, obtaining approval from the local authority was not the end of the inquiry. The plaintiff was also required to demonstrate compliance with the mechanism established in the co-ownership agreement, which it failed to do.
The decision demonstrates that a municipal permit to install a sign does not replace the need to comply with the contractual conditions and agreements governing the rights holders in the building.
Representation
Adv. David Sofer and/or Adv. Irit Hadar represented Defendant No. 3, A.G. Helem Ltd.
The claim was dismissed, and the plaintiff was ordered to pay Defendant No. 3 NIS 3,500 in legal costs, together with linkage differentials and interest as provided by law from the date of the decision until payment in full.
Source
File 516/11, before the Supervisor of Land Registration, Tel Aviv, Supervisor Oren Silverman, decision dated May 2, 2012.
The information provided in this article is for general informational purposes only, does not constitute legal advice and is not a substitute for individualized legal advice based on the circumstances of a particular matter.
