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Israel: Property Division in Divorce Agreement Voided After Wife Discovers Husband’s Fraudulent Double Life

(Dec. 6, 2013) Judge Tova Sivan, President of the Tel Aviv Family Court, established a new precedent in her November 4, 2013, decision that voided a final divorce agreement’s division of marital property. (Family Court (TA) 6771-07 Anonymous v. Anonymous, NEVO LEGAL DATABASE [by subscription] (last visited Dec. 2, 2013).)

In this case, after the court approved a divorce settlement agreed to by the parties through arbitration, the wife discovered that her husband of 20 years and father of her three daughters had led a double life with another woman. He had claimed his extensive absences from the family were for his work as a secret Mossad intelligence agent, when in fact he was living with his mistress and their mutual children. The wife moved to void the divorce settlement, maintaining that had she known the truth, she would not have agreed to financial concessions she made in the arbitration proceeding. (Id.)

Accepting the wife’s allegations, Judge Sivan held that the extreme circumstances of the case warranted voiding the agreement with regard to the property division between the parties. (Id.) In addition, the judge ordered the husband to pay the wife NIS200,000 (about US$56,830) in compensatory damages for emotional distress. (Id.)

An Israeli commentator noted that Israeli courts rarely void financial or divorce agreements. He opined:

In the past it was necessary to show the court that fraud had been committed in a property matter, for example, that the husband hid money in a bank account, hid rights in a company, etc., and that because of this hiding of property the wife forfeited property rights that, had she known of their existence, she would have claimed.

The present decision sets a precedent also from the aspect that the husband did not hide property, but misled the wife in a personal matter — maintaining a double life with another woman, [a relationship that was the reason] for which he wished to abrogate the marriage. The court determined that fraud so broad in scope was sufficient to lead to acceptance of the wife’s suit for voidance of the divorce agreement. (Roi Sidi, Court Decision May Create a Wave of Suits for Voidance of Divorce and Financial Agreements [in Hebrew], GLOBES (Dec. 2, 2013).)

The commentator suggests that from now on, “[c]ourts will have to determine when the case involves ‘a regular hiding of facts’ that … does not justify voidance of the agreement, and when it involves ‘major fraud’ that justifies it. (Id.)