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Our firm represented a foreign trustee, appointed by a foreign court, in an international insolvency proceeding against an individual who had left substantial debts in the foreign country.
As part of the representation, the Israeli court recognized the foreign insolvency proceeding and granted the foreign trustee various powers in Israel, including investigative powers. Relying on these powers, the foreign trustee approached the debtor’s relatives in Israel and summoned them for investigation in order to trace information, assets, and the debtor’s financial activity. In response, the debtor’s relatives filed a motion seeking to revoke the foreign trustee’s investigative powers.
Following the denial of the motion by the Magistrates’ Court handling the recognition application, an appeal was filed to the Tel Aviv District Court.
In a groundbreaking and precedential judgment, the District Court held for the first time that in recognition proceedings of foreign insolvency cases, the foreign trustee is in an enhanced informational disadvantage and therefore should be generously granted with broad investigative powers. The Court further ruled – also for the first time – that by its nature, a recognition order issued in Israel inherently includes the powers to conduct examinations of third parties by the foreign trustee, as necessary for the execution and implementation of that order. In doing so, the District Court fully adopted our legal position.
This judgment constitutes another milestone in our firm’s extensive and pioneering work in international insolvency proceedings, and we are proud to continue contributing to the development and shaping of this field within the Israeli jurisdiction.
An heartfelt thank-you to the legal team for their professional work on the case: ADV. Lior Dagan, Nadav Shefer, Kirill Stoichev, David Zanani, and intern Shahaf Keren.
