Court ruling9/22/2026

Court: Yosef Greenfeld Did Not Conceal a NIS 16 Million Dividend from Creditors

The Tel Aviv District Court rejected the trustee's claim that Yosef Greenfeld concealed from his creditors a dividend he received from Kardan Israel after approval of the creditors' arrangement. The court found that the shares and the possibility of a dividend distribution were known, and that it was not proven that Greenfeld had control over the timing of the distribution.

Key facts

•Court: Tel Aviv District Court
•Bankruptcy proceeding began in 2015
•Creditors' arrangement was approved in 2018
•Dividend to Greenfeld: approximately NIS 16 million
•The trustee's application included a demand for NIS 10 million
•20% of the proceeds from the Kardan Israel shares will be transferred to the arrangement fund

The Dispute Over the Dividend

Greenfeld's bankruptcy proceeding began in 2015, and in 2018 a creditors' arrangement was approved that was based, among other things, on his shares in Kardan Israel. A few days after the arrangement was approved, the company distributed a total dividend of NIS 85 million. Greenfeld, who held 18.85% of the shares, received approximately NIS 16 million.

The Trustee's Claims

The trustee of Greenfeld's assets argued that the future dividend had been concealed from the creditors, and that had they known about it, they would have delayed implementation of the arrangement by three days so that the money would be paid into the arrangement fund. He sought to require Greenfeld to pay additional sums, including NIS 10 million, and also argued that an increase in his income required a monthly payment of NIS 30,000 under the arrangement.

Why the Application Was Denied

The court found that the Kardan Israel shares were an asset known to the trustee and the creditors, and that the possibility of receiving a dividend was a scenario that was before them or that they should have anticipated. No evidentiary basis was presented showing that Greenfeld concealed the dividend, delayed its distribution, or controlled its timing. The claim regarding an increase in his disposable income was also rejected, among other reasons because the trustee did not act in real time to modify the payment obligation.

Distribution of the Proceeds from the Shares

Despite the rejection of the concealment claim, the funds from the sale of the Kardan Israel shares will be distributed according to the creditors' arrangement: 80% will go to Greenfeld and 20% will be transferred to the arrangement fund. The arrangement excluded dividends and the sale of Kardan Israel shares from the rule requiring the debtor to transfer 50% of grants or other dividends to the fund, and set a rate of 20% for them.

What this means for you

An asset or income is not necessarily considered concealed when its existence and the possibility of generating funds from it were known to the trustee and the creditors. Nevertheless, entitlement to the funds is still determined by the precise wording of the creditors' arrangement, including the distribution rates set in it.

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