Legal Precedents
Landmark cases and significant rulings that have shaped maritime law in Israel
Key Maritime Law Decisions by Adv. Ilan Orly
Adv. Ilan Orly is the founder and senior partner of Ilan Orly & Co., established in 1995 in Tel Aviv. He holds an LL.B. from Tel Aviv University (1983), was admitted to the Israel Bar in 1988, and has served as a Notary since 2003.
Orly served in the Israel Navy at the rank of Lieutenant Commander, sailing on combat vessels and submarines. He later served as captain of yachts and other vessels. His extensive practical experience in seamanship and maritime law provides him with a distinct advantage in his practice.
The firm handles shipbuilding contracts, charter parties and cargo agreements, bills of lading, marine insurance, salvage, and general average. The firm represents shipowners, charterers, operators, cargo owners, and local and international insurers.
Key Judgments and Precedents
Motion 105/98 – The Vessel Atlantic X v. Blue Bird Inc.
Haifa District Court (Admiralty)
Vessel owners sought to release their ship from arrest. The Admiralty Court ruled that when there is concern for property rights infringement, the vessel should not be released and ordered costs against it.
Significance: This decision strengthened the court's authority to arrest vessels and became an important tool for cargo owners to protect their rights.
Civil Case 1514/07 – Lloyd's Underwriters et al. v. G. Feron et al.
Tel Aviv District Court
A French freight forwarding company sought to stay proceedings based on a French jurisdiction clause in the bill of lading. The court ruled that when there are multiple defendants and only some are subject to the jurisdiction clause, Israeli proceedings may be preferred to avoid case fragmentation and conflicting outcomes.
Significance: The ruling established that foreign jurisdiction clauses are not absolute, and Israeli courts may hear cases when there is concern for injustice or inefficiency in foreign proceedings.
Phoenix Insurance Company v. Tober Shipping
Tel Aviv District Court
An insurance company sued a packaging and shipping company for cargo damage. The court ruled that a packaging company that is neither the owner nor charterer of a vessel is not a "sea carrier" under the Carriage of Goods by Sea Ordinance; packaging and shipment organization services are not part of sea carriage.
Significance: This ruling clearly defined boundaries: only vessel owners or charterers can rely on the Ordinance's protections (such as shorter limitation periods), meaning freight forwarding companies are not protected.
Admiralty Case 30100-10-10 – Milubar v. The Vessel "Eleftheria"
Haifa Admiralty Court
After Zurich Insurance paid part of the damage, Milubar sought to join the insurer as a party. Judge Ron Sokol ruled that although the Insurance Contract Law does not apply to marine insurance, Section 62 allows subrogation and transfers the right of action to the insurer who paid. Therefore, Zurich was permitted to join as an additional plaintiff.
Significance: This ruling reinforced the principle of subrogation in marine insurance and regulated the insurer's right to continue proceedings after paying benefits.
Appeal 8205/16 – Contrastock OY v. The Vessel Thor Horizon
Supreme Court of Israel
Wood importers sued a vessel for cargo damage; the contract contained an English jurisdiction clause. The Supreme Court ruled that although foreign jurisdiction clauses are binding, when there is concern that the foreign claim would be dismissed due to limitation and the appellants did not delay, "practical justice" justifies conducting proceedings in Israel.
Significance: The ruling provides flexibility in enforcing jurisdiction clauses and protects Israeli cargo owners from losing their right to sue.
Vessel Arrest for Fuel Debt
Admiralty Court
A request to cancel a vessel arrest was rejected. The fuel supplier, represented by the firm, successfully maintained the arrest on the vessel.
Significance: The case reinforced the effectiveness of vessel arrest as a remedy for maritime creditors securing payment for supplies.
Demurrage Claim Against Importer
District Court
The importer was ordered to pay demurrage charges while the shipping company was required to return only a small amount. The court ruled that the importer cannot dispute demurrage if no timely appeal was filed.
Significance: The ruling established important precedent regarding the procedural requirements for contesting demurrage charges.
Arbel & Partners v. Ashdod Port
Supreme Court of Israel
The Supreme Court accepted the appeal and obligated the port to provide unloading services without additional payment.
Significance: A landmark Supreme Court victory clarifying port obligations and protecting importers from excessive charges.
Subrogation Claim Against Ashdod Port (Civil Case 41124-02-10)
District Court
The court dismissed the insurers' claim after ruling that they failed to prove the reasonableness of the payment made to the insured.
Significance: The decision emphasized that insurers pursuing subrogation claims must prove their payment to the insured was reasonable.
Belinda Shipholding Corp v. Ashdod Port
Admiralty Court
Parts of the claim for fee refunds were dismissed when the port proved it had provided waste removal and bilge water pumping services.
Significance: The ruling supported port authorities' right to charge for actual services rendered.
Administrative Appeal 5694/07 – Purchase Tax Refund
Supreme Court of Israel
The Supreme Court rejected the importer's demand for a purchase tax refund for goods stolen from a bonded warehouse, accepting the position of the storage company and insurer.
Significance: The ruling clarified tax obligations in cases of theft from bonded warehouses.
Civil Case 59608-11-17 – S. v. Harel Insurance Company
Tel Aviv Magistrate Court
A yacht owner sued for insurance benefits after the vessel sank. The policy was in English and subject to English law. The court ruled that although vessel sinking is a covered peril of the sea, it was proven that the yacht was unseaworthy due to defects created by the insured; this breached a warranty and the policy lapsed under English law.
Significance: The ruling emphasizes that in marine insurance, expert opinion on foreign law must be presented and that breach of policy conditions may void coverage.
A.R.D.O Food Industries Ltd v. Salamis Lines
Haifa Magistrate Court
A fish importer sued a shipping company and vessel agent after a shipment from Lithuania was destroyed due to unauthorized alteration of the veterinary seal. The court ruled that the shipping company was liable for the damage while the vessel agent bore no responsibility.
Significance: The judgment illustrates the importance of maintaining official seals and documents in maritime transport and demonstrates the firm's successful handling of cargo claims.
Additional Notes
Total Loss in Marine Insurance
In a case involving an onion seed marketing company against its insurers, the court ruled that "total loss" also occurs when cargo is seized or held by foreign authorities with no reasonable chance of recovery. This expanded the interpretation of "total loss" in marine insurance policies.
Comprehensive Practice Areas
The firm's practice includes advice and representation in additional matters such as charter contracts, bills of lading, salvage operations, general average, and pollution risks, as well as providing legal opinions to the insurance market in London and Israel.
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