Collateral & Liens

At B. Levinbook & Co., our expertise in banking and insolvency law, alongside our regular representation of Israel’s leading banks, means we are particularly well-suited to address a wide range of legal issues related to collateral and liens.

Banking corporations are, of course, creditors holding a variety of collateral, including liens on many types of assets in order to secure third-party obligations to them. In these respects, the firm handles both creation and drafting of collateral documents, and a wide range of litigation cases, legal proceedings, insolvency proceedings, legal opinions, dispute settlements, and drafting of various agreements related to collateral and liens, as well as in the management of disputes that arise in relation to them.

The firm specializes in handling cases in which there is competition between different creditors holding various collaterals of different degrees. These include, for example, disputes between creditor banks, disputes between a bank and another creditor, disputes between a collateral-holding bank and a foreclosure agent, and more. The firm also handles many varied, complex issues related to the following subjects: property liens, bank loans for construction, liens on securities, liens on negotiable documents, liens on floating assets, liens rights, assignment of rights, banks’ right of offset as collateral, right of lien and its implementation, realization of collateral, and many more.

There is practically no field or sub-field related to collateral and liens that B. Levinbook is not well-versed in, from the stage of the collateral’s creation and through to its realization, as well as litigation related to collateral and liens.

Furthermore, the broad scope of the firm’s activity in the field of insolvency has made B. Levinbook & Co. a leading authority on all matters relating to disputes between types of creditors and applicable legal precedents.

B. Levinbook’s expertise in the field of collateral and liens is clearly reflected in the long list of diverse cases handled by the firm over the years, including the following notable examples:

• Representing Union Bank of Israel in insolvency proceedings of the Noga Group in which, among other topics, the question of the validity of bank guarantees issued at the request of Noga by banking corporations to a third party was discussed, taking into consideration the claim that Noga’s owners misled the banks as to the purpose of the guarantees and their substance.
• The Supreme Court accepted the Bank’s position on the guarantees by applying the “bad faith” doctrine from contract law (general part) on bank guarantees, stating that if a bank issuing a bank guarantee was deceived regarding the nature of that guarantee, and the third party beneficiary of the guarantee, knew or should have known, or “turned a blind eye” to the error, the bank guarantee is canceled.
• Representing Bank Leumi in the process of realizing liens related to one of the largest and most complex projects undertaken by Hefziba, one of Israel’s largest construction companies, which collapsed and left hundreds of millions of shekels worth of debt and a large inventory of unfinished apartments. Our firm was appointed to handle property receivership proceedings, including arrangements with purchasers, completing construction, sale of inventory of apartments and construction plots, and more.
• Our firm is regularly involved in especially complex and wide-ranging insolvency proceedings, including cases against some of the largest corporations in Israel in the context of which, inter alia, complex issues in the area of collateral and liens and their realization are discussed. These include proceedings related to Polar Investments, Control Centers, Herzliya Marina, the Solor Group, Ben-Dor Diamonds; Tzvi-Or Diamonds, M.K.R., Hefziba and many more.