Holocaust Restitution Co. Accuses Historic Zionist Land Agency of Welshing on Debts

Restitution company knows as Hashava claims Israel Land Development Company refused to pay millions of shekels for land purchased in the 1930s by 45 Jews who died in the Holocaust

Lee Yaron
Lee Yaron
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Israel Land Development Company offices in Tel Aviv
Israel Land Development Company offices in Tel AvivCredit: David Bachar
Lee Yaron
Lee Yaron

The Holocaust Restitution Company of Israel is accusing the Israel Land Development Company of violating the law by refusing to pay it millions of shekels for land purchased in the 1930s by 45 Jews who perished in the Holocaust.

The request by the restitution company, known as Hashava, relates to 29 plots in Yokne’am in northern Israel. According to Hashava, they were purchased by 45 Holocaust victims, most of whom lived in Lithuania and the rest of whom lived in Poland, Belgium and Greece. Hashava claims the ILDC unilaterally voided contracts and resold the land to the Israel Lands Authority after the war without taking possible heirs into account. Hashava sent 29 letters between 2011-2017 demanding payment for the value of the resold land.

According to Hashava, the ILDC rejected 16 of its requests and never responded to 13 others. In only two other cases relating to similar plots did the ILDC agree to pay. In rebuffing the 16 requests, the ILDC claimed that either the plots had not been purchased by Holocaust victims, or that their full purchase price was never paid so the sale was voided.

Hashava says that within a week it plans to file suit in Jerusalem District Court over the 29 plots. The case has assumed a sense of urgency because Hashava is meant to shut down at the end of this year, after having restored to heirs some 670 million shekels ($182.9 million) in cash or property and obtained nearly a billion shekels to assist Holocaust survivors. Responsibility for legal proceedings not completed by the end of the year will be assumed by the Custodian General’s Office, but any such transfer of authority will likely cause additional bureaucratic delays.

‘Only Israeli agency yet to return property’

Hashava says the ILDC is the only agency in Israel that has yet to transfer victims’ properties it says should be transferred by law. In a letter to the ILDC’s board, Hashava’s legal adviser, Ofir Porat, wrote that the company “continues to hold the assets of Holocaust victims against the law and court rulings.” Micha Harish, chairman of Hashava, wrote to ILDC chairman Shlomo Maoz, “It’s inconceivable that the State of Israel will point an accusing finger at the whole world regarding the restitution of property of Holocaust victims, but here there should remain assets of Holocaust victims that are not restored to their heirs.”

Hashava’s mandate since it was founded in 2006 is to locate assets in Israel, including real estate, bank accounts and shares that belonged to Holocaust victims before the war, and restore either them or their value to the victims’ rightful heirs, or use the proceeds to help needy Holocaust survivors if heirs cannot be located. Before Israel’s founding, the ILDC operated as a subsidiary of the Jewish Agency and sold land in Palestine to many European Jews who did not survive World War II, in many cases perishing before making all the payments.

The ILDC insists that of all the hundreds of transactions it made during the relevant years, there are only four cases in dispute that reached the courts. Of these four, two ended in a compromise under which the ILDC paid 2 million shekels; in another case, the ILDC was ordered to pay 400,000 shekels (which was paid, though Hashava has appealed that decision and the ILDC has counter-appealed).

“The last case is still in legal proceedings and there hasn’t been a final ruling yet,” the company said. “Moreover, in instances where the ILDC came to the conclusion that there is more than a 50 percent chance that Hashava’s claim was justified, the ILDC, beyond the letter of the law, repaid monies paid for the land purchases based on the revaluation formula prescribed by the law, which came to less than 1 million shekels.”

The ILDC added that in numerous cases that came to court, it turned out that Hashava had done faulty research, “and that in some of the suits filed it turned out - following inquiries made by the ILDC, whose findings were accepted by the court - that at issue were Jews who hadn’t even perished in the Holocaust.”

Three months ago the Jerusalem District Court ruled on a case involving the ILDC, relating to five plots purchased by a Holocaust victim named Baruch Bloch in Yokne’am. In 1934, Bloch, who lived in Lithuania, signed a contract with the ILDC to buy 50 dunams (12.5 acres) for 450 Palestinian lira. Bloch, who paid 71 percent of the total, died at the age of 68 in a Siberian labor camp in 1943, before he was able to take possession.

The case of Baruch Bloch

According to the court, the ILDC unilaterally voided his contract and in 1946 sold his land to the Jewish National Fund. During the 1960s, when Bloch’s daughter, Sonia, asked the company for details on his purchase, she was told, “An inquiry made following your letter found that we have no land on the above-mentioned person’s name.” The ILDC’s argument was that Bloch was not a Holocaust victim because he wasn’t murdered by the Nazis or their henchmen, but had died of natural causes.

This past December, Judge Nava Bar-Or ruled that Bloch was indeed a Holocaust victim and that the ILDC had illegally voided the contract, and that it had to pay Hashava the value of the land for the benefit of Bloch’s heirs. Now the parties are waiting for a ruling on the value, which is expected to be between 5 million and 9.6 million shekels. “But Bloch is only one case,” said Hashava legal adviser Porat. “We’ve located dozens of other Jews like him, who bought land from the ILDC in Yokne’am and paid for it, but never got the land.”

Zvi Vilnai, the son of a Holocaust survivor who is an heir to Bloch, said, “Throughout the whole case the ILDC made every effort to evade responsibility, raising every possible and impossible argument. My parents were shocked by the ILDC’s attempts to cast aspersions on them and the sisters [Bloch’s daughters], all just to avoid paying the heirs.”

The ILDC Group responded by saying, “The content on which this article is based is full of incorrect facts and inaccuracies, to say the least.” The company said that the transactions at issue were signed more than 80 years ago, and that the company has worked both in Israel and abroad to find documents related to them, but that this takes a great deal of time.

The company added, “The director-general of the Hashava company on her own initiative has noted that the ILDC worked fairly when it transferred assets considered those of missing persons to the JNF and the Custodian General, and that due to the permission the ILDC gave to Hashava to search its archives, many heirs were located for assets that were in the hands of the Custodian General.”

The ILDC further decried the amount of money Hashava spends on its activities. “The cost of maintaining Hashava comes to tens of millions of shekels, so sums that could be used to help Holocaust survivors are actually being used to pay inflated salaries in the company, rather than serve the purposes for which Hashava was founded.”

The company added, “The management of the ILDC sees its activities from the era of its previous management on the issue of land purchases in the Land of Israel and its conduct toward Holocaust survivors and the Custodian General with regard to anything relating to Holocaust victims as a source of pride. All attempts to slander the leaders of the ILDC, from the era of Yehoshua Henkin, Arthur Ruppin and others to this day, will not succeed.”

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