In order fully to understand and appreciate the place of the Religious Courts in modern Israel, we must go back to the time when Palestine was ruled by the Porte of Constantinople and Moslem law was the law of the country. Thereafter we have to consider the period of British Mandatory rule of Palestine and the changes then introduced in the legal system.

Ever since the American and the French revolutions, it was taken for granted that a written, formal, Constitution was essential to the functioning of a modern State. Old-established States, as they moved toward modernization or away from absolutism, hurried to provide themselves with Constitutions. New States enacted Constitutions as a matter of course, as one of the first acts of a newly-found sovereignty, often copying them from available models and without pausing to consider to what extent the provisions copied would suit the particular characteristics and goals of their respective societies. The well-known process of “reception” of laws was followed by a similar trend to “receive” Constitutions. To have a formal Constitution well-nigh became a universal fashion, a symbol of modernism. In the aftermath of the First World War, only two groups of fully independent States remained without Constitutions. One of them comprised countries still in their pre-modern stage, in respect both of their political and of their general social set-up, and without pretensions to modernity: Afghanistan, Ethiopia (then Abyssinia), Saudi Arabia, Thailand (then Siam), Yemen; since then, each of these, bent on modernization, provided itself with some kind of constitutional chart. The other group consisted of the one and only Great Britain, looked upon by everybody as a case apart.

The historic and almost revolutionary emergence in the last century and a half of previously amorphous social strata has revealed problems vitally affecting the economic organization of society, which would not seem to yield unitary solution. But the novel conditions of the present time demand radical changes in the legal institutions which have hitherto regulated the economic aspects of life, and in fact a new complex economic instrument has evolved, which is gradually yoking private enterprise with community interest and is in the process destroying the methodological distinction between the private and public domain. This new instrument is built upon old structure, modified by an adaptive reshaping of its fabric, by the addition of new foundations and accommodating itself to new demands, and is in this manner in direct historical continuity. But although this instrument derives from and is fashioned upon earlier legal patterns, it reflects a profound economic and social change as projected on the legal plane. The instrument is the institution we term the “enterprise”.

In the decisions of the Israel Supreme Court delivered since the establishment of the State, one sometimes comes across the express or implied statement of the rule that:

The object of this article is to clarify a few aspects of this rule (which, for the sake of brevity, will be referred to as the rule of “constructive intention”).

Crime has become a major focus of public attention in the United States. Not white collar crime like embezzlement or tax fraud, nor crimes of passion, nor even the organized crime of professional gangsters. The public is gripped by newspaper accounts of crimes which endanger the physical safety of the population: robbery, housebreaking, assault, rape, and murder. Preoccupation with crime pervades every level of discussion; indeed, when Senator Goldwater made “crime in the streets” a major issue in his ill-fated campaign for the Presidency in 1964, he touched upon a nerve that is very raw in many Americans. Today, Truman Capote's In Cold Blood, a remarkable account of an apparently senseless robbery and murder, is storming the best-seller lists in our book stores.

After my sixteen years on the bench, it seems to me that it is usually not difficult to identify the class from which perpetrators of urban crimes of violence come. Almost all of the persons accused of this category of crime come from the bottom of society's barrel. They are the ignorant, the ill-educated, the unemployed, and often the unemployable. In a society which prides itself on opportunity and wealth, they have been brought up in terrible poverty. Few of them have had the advantage of what we call a moral upbringing. Because they lack education and skills, they are virtually excluded from the advantages of our economic and cultural life. Many of them are subjected to the grinding humiliation of racial discrimination. In the big cities, they no longer share the roots and traditions which may make rural poverty bearable. On every side, society holds out promises which, for them, are never kept; symbols of success which, for them, cannot be obtained.

An oft-repeated proposition asserts that fraud “vitiates the most solemn proceedings of courts of justice. Lord Coke says it avoids all judicial acts, ecclesiastical or temporal”. Fraus omnia corrumpit. That great master of the common law, Willes J., said in 1863: “…a judgment or decree obtained by fraud upon a court binds not such court, nor any other; and its nullity upon this ground, though it has not been set aside or reversed, may be alleged in a collateral proceeding.”

Nevertheless, such declarations cannot be accepted without reservation. Let us illustrate. A man sues for detention of his goods. The defendant asserts that plaintiff's case is a concocted deception; that the documents are forged and that the plaintiff himself and his witnesses are deliberately perjuring themselves. The defendant maintains, in fact, that the goods in question are, at the very time of trial, being concealed by the plaintiff. The court goes fully into the testimony, rejects the allegations of perjury and fraud, and awards the plaintiff damages. The absolute truth will perhaps never be known. What we do know is that the unsuccessful defendant is henceforth estopped by res judicata. He cannot resist the effect of the judgment, still less can he set it aside, unless he can avail himself of fresh evidence, discovered since the trial; and unless, moreover, he can satisfactorily account for not having known this evidence and made use of it at the trial. This has been clear law since at least early in the 17th century when it was expressly laid down by Bacon L. C. Indeed, the need for new evidence furnishes a major distinction between impeachment (or “review”, as it is also called) of a judgment, on the one hand, and an appeal proper, on the other. This distinction is further reflected in the rule that appeals must be lodged within a prescribed period of time—not so impeachments or reviews.

Of the sixty-thousand books said to have been written on the life of Jesus in the last century alone, only a very few were enquiries by lawyers or legal historians into the nature and circumstances of the trial, in which his life culminated and which led to his death. This is surprising, considering that no trial in the history of mankind was of such momentous consequences, that none has ever given rise to such widespread, authoritative and persistent assertions that a grave miscarriage of justice had occurred and that none has had repercussions which have retained their impact and actuality even after the lapse of 1,936 years; It is true that, in their researches, great historians and theologians have made ample use of the legal background material they have painstakingly and (mostly) conscientiously collected from Jewish and Roman sources, and every lawyer approaching the subject today owes them a great debt of gratitude for their preparatory work. But both their approach and their purpose were historical or theological, whereas we as lawyers are not concerned with the historical or theological truth of any statement or description contained in the Gospels. Our purpose is to try and find, within the framework of the prevailing legal institutions and conceptions, some plausible interpretation of the events as to the occurrence of which there is general consensus.

The courts and the legislature in both Israel and Britain have recently been occupied with the problem of the valuation of investment property upon conversion to business use. The problem involves the whole complex of income tax and capital gains taxation and goes to the root of the income tax system. Different approaches to the basis of valuation in “converted property” cases have been taken by the American Internal Revenue Code, under the British Finance Act and according to the Israel Income Tax Ordinance. The main object of this study is to analyse and compare the similarities and differences of these tax systems and try to draw conclusions which will suggest the lege ferenda to be applied in Israel. I shall first examine the American practice, then deal with the British views and finally consider the approach adopted by the Israel courts.

The new Israel Civil Procedure Rules, 1963 re-enact in rr. 269–82, with certain amendments, rr. 241–50 of the Palestinian Civil Procedure Rules, 1938 dealing with “Summary Procedure on Specially Endorsed Statement of Claim”, which in their turn were a colonial version of Order XIV of the English Rules of the Supreme Court. A glance at some recent judgments in Israel shows a surprising number of cases in which doubts have arisen as to the application and scope of the Summary Procedure in general and the defendant's right to be heard in particular. One may wonder whether litigants and lower courts quite understand the rules of the game or whether the game is after all not as easy as might be expected of a summary procedure. And indeed, compared with institutions in continental Europe, where scores of thousands of claims are disposed of without discussion and complaint, our Summary Procedure seems inelegant and burdensome on plaintiff and defendant alike. It is the object of this study to compare it, and the procedure under the English Order XIV, with those European institutions. In view of the gap between Anglo-Israel and Continental notions of civil procedure it may be useful also to sketch the history of the various forms of action, viz. the (summary) trial by documents, the non-litigious executory instruments and the conditional command to pay.

The status and place of religion in the law of Israel has been the subject of public controversy, leading to highly emotional outbursts and fervent debate. It is not surprising, therefore, that lawyers and serious writers have shunned this stormy field and have preferred calmer subjects. But this is not the only reason for avoiding a legal discussion of religion in Israel. The subject is strewn with difficulties, legal and extra-legal. The absence of a constitution and the almost unlimited power of the Knesset have resulted in a patchwork of laws which make generalization almost impossible. The provisions of law relating to religion in Israel are not governed by any general scheme. History, political expediency, party politics and, even more, chance are responsible for an amorphous body of laws which baffles outsiders as well as some Israelis dissatisfied with the present state of the law in this field. The present writer belongs to those who resent the use of secular laws to curb religious freedom and to enforce religious practices on non-religious persons. Nevertheless, it is hoped that the present account and analysis of the state of the law is not tainted by personal bias and that in this article a wall separating, if not State and church, at least opinion and fact, is established.

The Israel law on damages for breach of contract is contained in arts. 106–11 (112) of the Ottoman Code of Civil Procedure, 1879 (OCCP), and the law on damages for torts in the Civil Wrongs Ordinance, 1944, (CWO)— enactments from two different worlds, built upon different foundations. The tests of liability are as follows.

OCCP

art. 109. “If the non-performance of an agreement be not due to bad faith on the part of the person who has undertaken to perform it, the damages awarded against him shall be equivalent only to the direct and determinate loss suffered by the other party owing to such non-performance.”

art. 110. “If the non-performance of the agreement be due to fraud or bad faith on the part of the person bound to perform it, he shall be liable to pay damages which shall include both direct loss caused to the other party by such non-performance and also profits of which he may have been deprived owing to such non-performance.”

CWO

sec. 60, prov. (a), “…where the plaintiff has suffered damage, compensation shall only be awarded in respect of such damage as would naturally arise in the usual course of things and which directly arose from the defendant's civil wrong;…”

Among all the criteria of liability for damages (which will hereafter be analysed) one only is common to both laws—“direct” damage. But neither law is original; it will be more interesting, and more instructive for the elucidation of their meaning, to go back to the sources and to compare both sets of provisions with their source, and the sources with each other.

Any scientific discipline worthy of the name is successful in eliciting the essential nature of the area with which it is concerned and in identifying its basic categories and determining the rules applicable to the inter-relationship of these categories. On these conditions alone can scientific inquiry fulfil its major, perhaps only, task of solving the practical problems that arise in the particular area of study. In every science, therefore, a central place is assigned to an examination of its specific categories.

Jurisprudence establishes general juridical categories that prevail in every branch of law. Yet each branch of law, including the criminal law, has laid down and delimited its own particular categories and continues to do so. From time to time social phenomena appear which do not lend themselves to the classificatory grouping of the current jurisprudential theory. In such cases, the scholar must extract the basic constituents of these phenomena, trace their specific consequences, determine their special nature and dovetail them into the classificatory system of the relevant branch of the law. From this process also derives the practical interest of the scholar in facilitating the smooth articulation of the actual phenomena with the previously prescribed categories and relating to them the legal effects specific to the category under which they fall to be grouped.

In these hints Galsworthy the artist describes the attitude of English society in 1886. Galsworthy the member of Lincoln's Inn writing in 1906 also knows it as the attitude of English law: a married person has the right of connubium at any time, not dependent on his spouse's love or willingness, and nothing a husband does to compel his wife to have with him normal sex relations will be considered as rape upon her.

Although legally the Israel Supreme Court is not bound by its own decisions, in practice it will normally follow them. It is therefore not surprising that when the Supreme Court recently deviated from a previous decision, the case raised considerable interest as well as some controversy. The case in question is Cohen v. Assessing Officer, which was heard before a bench of five judges. By a majority of three to two the Court deviated from a decision which had been unanimously reached, by a bench of three judges, in Ben Zvi v. Assessing Officer. Both cases dealt with a tax problem which confronted the Israeli revenue for the last ten years. As will be shown, the problem is not limited to Israel Law. Indeed, one of the main points considered by the Court was the meaning and effect of the controversial decision of the House of Lords in Sharkey v. Wernher. This was the problem involved.

It is a basic rule of Israel tax law that a man who sells land for a profit is not liable to pay income tax unless the profit has been derived from “any trade…or from any transaction or adventure in the nature of trade”.