Background
In 2024, Israel enacted the Law for Compensation of Terror Victims (Exemplary Damages), which allows victims of terrorism to sue the Palestinian Authority (PA) as a “terror rewarder” for large, fixed-sum exemplary damages. To qualify, a victim must prove, among other things, that they sustained a “permanent disability.” These two consolidated appeals concern the method of proving that disability.
In the first case, a terror victim sued the PA based on a permanent disability rating determined by a medical committee of Israel’s National Insurance Institute (NII). In the second case, a family of a murdered victim sued the PA based on a disability finding made in a prior tort lawsuit against the terrorists, which had ended in a default judgment. In both proceedings, the PA demanded the right to challenge the underlying disability determination by presenting its own contradictory evidence.
The Jerusalem District Court denied the PA’s requests in both cases. It ruled that the 2024 law does not contain a provision allowing a defendant to re-litigate a prior disability finding made by the NII or in a separate tort action. The PA appealed these decisions to the Supreme Court, arguing that preventing it from challenging the disability finding violates its fundamental due process rights and turns the proceeding into a mere formality.
The Court’s Holding
The Supreme Court, in a unanimous decision written by President Isaac Amit, denied the appeals and affirmed the lower court rulings. The Court held that the 2024 law conclusively establishes that a prior determination of permanent disability, whether by the NII or in a tort claim, is binding on the PA and cannot be challenged by introducing contradictory evidence.
The Court’s analysis was based on a straightforward interpretation of the statute. It found the law’s language to be unambiguous, stating that a victim “shall be entitled” to compensation if a disability “was determined” (past tense), indicating that the statute relies on a pre-existing finding rather than requiring a new one. The Court contrasted this with another statute, the Road Accident Victims Compensation Law, where the legislature explicitly included a right to bring contradictory evidence. The absence of such a provision in the 2024 law, the Court reasoned, was a deliberate legislative choice creating a “negative arrangement.”
The Court further held that this interpretation aligns with the law’s purpose: to create a fast and efficient process for terror victims to receive compensation while deterring the PA from financing terrorism. Allowing the PA to re-litigate the disability issue in every case would frustrate this goal. While acknowledging the result was “difficult” for the PA, the Court noted that the harm was mitigated because the prior disability findings were made by reliable, quasi-judicial bodies (the NII committees) or by a court of law exercising judicial discretion, even when issuing a default judgment.
Key Takeaways
- Under Israel’s 2024 Law for Compensation of Terror Victims (Exemplary Damages), a prior finding of permanent disability from the National Insurance Institute or a tort lawsuit is binding on the defendant.
- The law does not provide a mechanism for the defendant, such as the Palestinian Authority, to bring contradictory evidence to challenge the validity or extent of that prior disability finding.
- A disability finding is binding even if it stems from a default judgment against the direct perpetrators of the terror act.
- The Court prioritized the law’s clear text and its purpose of providing a streamlined process for victims over the defendant’s procedural right to contest every element of the claim in court.
Why It Matters
This decision solidifies the 2024 Exemplary Damages law as a potent and rapid tool for terror victims in Israel to obtain substantial awards from the Palestinian Authority. By precluding the PA from challenging the core element of a victim’s disability, the Court has ensured that these lawsuits will be procedurally simple and swift, in line with the legislature’s intent. The ruling significantly lowers the burden of proof for plaintiffs and creates a state of “almost automatic” liability, as the Court itself noted, once a qualifying prior disability has been established. It marks a significant development in Israeli anti-terrorism law, emphasizing victim compensation and deterrence over the traditional procedural defenses of a defendant.