Firm sues state for NIS 171m over building freeze

A company building 2,300 housing and commercial units in Modi'in Ilit filed a request for NIS 171 million in compensation with the Defense Ministry's complaints department yesterday, over alleged damage caused by the construction freeze in West Bank settlements.

Neot Hapisga Modi'in Ilit says the head of the Israel Defense Forces Central Command, Gen. Avi Mizrahi, issued an administrative order declaring a construction freeze in Modi'in Ilit in May 2009, citing the need to rework the separation fence route in the area. This caused the company significant damage, it says, vis-a-vis homebuyers, banks, other sources of financing, suppliers and the company's bondholders. Plus, the company's reputation was damaged, it says. A month and a half ago, the company sent a letter to the prime minister, defense minister, finance minister and Mizrahi, demanding NIS 18 million in compensation immediately. It said it had sustained hundreds of millions of shekels in damage, and needed the money in order not to collapse.

The government is responsible for the damage, and therefore should pay compensation, it says. After this attempt failed to bring results, the company turned to the Defense Ministry.