A legal opinion slams the land deal between Israel Salt Industries Ltd. (TASE:SALT), controlled by members of the Dankner family, and the Israel Land Administration (ILA). The opinion has just been disclosed now, five years after the deal that aroused a storm of controversy.
In October 2003, the ILA Council agreed that land leased by Salt Industries for its industrial salt production from the ILA until 2060 could be rezoned for residential use. The ILA and Salt Industries would share the proceeds.
The Jewish National Fund legal counsel told the ILA Council in October 2003 that the deal was illegal. The council, then chaired by Ehud Olmert, nevertheless approved it. The ILA and JNF subsequently refused to disclose the legal opinion.
Hartabi, Bornstein, Basson & Co. Law Offices, which represents many farmers in cases against the ILA, petitioned the courts to disclose the legal opinion and examine whether any bias occurred in favor of business interests, such as Salt Industries, against the farmers.
The legal opinion implies that Salt Industries' land was used for agricultural purposes, and that the compensation should have been paid accordingly. Nonetheless, the first agreement in principle between the parties in 1996, which was voided following sharp criticism by the State Comptroller, as well as the new agreement that replaced it, stated that the contract was for urban land. The contract therefore created a benefit of tens of millions of dollars for Salt Industries at the expense of the state.
Following the disclosure of the legal opinion, Adv. David Basson said that his firm's struggle to disclose it had been shown to be justified. He added that the opinion once again proved that the ILA unfairly treated small leaseholders, both farmers and townsmen, while giving unconscionable and unreasonable benefits to tycoons at the public's expense. He said, "This is further proof of the lack of uniformity and fairness in the ILA's policy."
Published by Globes [online], Israel business news - www.globes-online.com - on July 2, 2008
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