1 Sec. 4(b) of the Law provides: “A Minister may declare a particular service to be a controlled service”; sec. 5(a)(3) of the Law provides: “A Minister may regulate by order … the performance of a controlled service” (12 L.S.I. 26).

2 In accordance with the arrangement established under secs. 4 and 5 of the Law, the publication of the Order was preceded by a declaration, issued by the second respondent, declaring the establishment of a new hospital a “controlled service”. The Order itself stated, in essence, that the establishment of a new hospital required prior approval by the Director General of the Ministry of Health (i.e., the first respondent). In deciding whether or not to grant such approval, the Director General was entitled to consider, inter alia, the needs of the State, and of any area of the State, concerning medical services. It should further be noted that the content of the Order reflected the formulation of a proposed amendment to the Public Health Ordinance, 1940, put forward by the respondents. The respondents claimed that, in view of the importance of the matter, they had decided to issue the Order which was meant to serve as interim legislation until the proposed amendment to the Ordinance was passed.

3 Sec. 25 of the Ordinance provides: “It shall not be lawful to institute or to conduct a hospital unless such hospital shall have been registered by the Director, and any person contravening the terms of this section is guilty of an offence and is liable to a fine not exceeding fifty pounds” (P.G., 1940, vol. 1, p. 100).

4 The petitioner claimed that it had satisfied all of the conditions set out in sec. 27 of the Ordinance, which were all of a professional-medical character. Sec. 27 provides: “No hospital shall be registered unless the Director is satisfied that — (a) the licensed medical practitioner or the licensed medical practitioners in charge of such hospital or parts thereof are qualified to practice any special branch or branches of medicine there dealt with, and are in all other respects suitable to be in charge of such hospital; and (b) the nursing staff is adequate; and (c) the matron or other person in charge of the nursing staff in the hospital is a qualified nurse and holds a diploma or certificates of training in nursing recognised by the Director; and (d) the site, building or buildings, and general amenities are in all respects satisfactory; and (e) the equipment is suitable and sufficient to meet the requirements of such hospital or nursing home; and (f) such hospital contains not less than twelve beds exclusive of beds for isolation, for patients” (P.G., 1940, vol. 1, p. 100).

5 Sec. 33 of the Ordinance provides: “The Director may make rules regarding the institution, registration, conduct, and supervision of hospitals and nursing homes and a copy of any rules made under this section shall be furnished to every registered hospital and nursing home; without prejudice to the generality of the powers so conferred the Director may make rules prescribing requirements with regard to (a) the sanitary arrangements; (b) the accommodation for patients and nursing staff; (c) the accommodation for operation theatres, laboratories, sterilisation, and disinfection, pharmacies and other technical purposes; (d) the nursing staff both as to qualification and training; (e) the preparation and storage of food both for patients and staff; (f) general medical and domestic arrangements; (g) arrangements for disinfection and the prevention of the spread of infection; (h) arrangements in the event of fire; (i) the admission and discharge of patients, and keeping and supervision of records and statistics; (j) hours of work and working conditions for nurses” (P.G., 1940, vol. 1, p. 101). It should be noted that pursuant to this section, the Public Health (Registration of Hospitals) Rules, 1966 were passed. These rules set out the manner in which an application for the registration of a hospital is to be submitted, and did not constitute an obstacle to the realization of the petitioner's plans.

6 Presumably, the importance of this part of Shamgar P.'s judgment stems in part from the fact that the Order was issued (ostensibly) pursuant not only to sec. 5 of the Law, but also to the power vested in the second respondent (via sec. 32 of the Basic Law: The Government (22 L.S.I. 257)) under sec. 33 of the Ordinance.

7 Sec. 5(b) of the Law provides: “Wherever a Minister is authorised to regulate anything under this section, he may prohibit or restrict the same or make it subject to control, inspection or the fulfilment of conditions, including conditions for the receipt of a licence, either general or special” (12 L.S.I. 27).

8 12 L.S.I. 26.

9 Sec. 1 of the Law defines the term “essential activity” as “any activity which a Minister regards as essential to the defence of the State, public security, the maintenance of regular supplies or regular services, the increase of exports, the intensification of production, the absorption of immigrants or the rehabilitation of discharged soldiers or war invalids” (12 L.S.I. 25).

10 Hence, ordinarily a rule or regulation could not, for example, impliedly repeal an earlier piece of primary legislation. In this context, Barak J. referred to a number of previous decisions, including, inter alia: Piltzer & others v. Minister of Finance (1970) 24(i) P.D. 113.

11 Sec. 46(b) of the Law provides: “Wherever a provision of this Law is repugnant to a provision of any other Law, the provision of this Law shall prevail…” (12 L.S.I. 40); sec. 1 of the Law defines the term “this Law” as including “the regulations and orders made thereunder” (12 L.S.I. 26).

12 Shamgar P. stressed that the combined effect of secs. 46(b) and 1 of the Law created an anomalous, if not unreasonable, legal situation which threatened the customary dominance of the legislative branch of government over the executive branch, and which, in his opinion, should be rectified by the Knesset. He remarked (obiter) that according to the language of sec. 46(b), an order made under the Law would even take precedence over later primary legislation. Historically, Shamgar P. explained the far-reaching arrangement under sec. 46(b) in terms of the fact that the Law had replaced a series of emergency regulations. This fact in turn explained why, under sec. 2 of the Law, the application of the Law had been restricted to a period in which a state of emergency exists in the State by virtue of a declaration under sec. 9(a) of the Law and Administration Ordinance, 1948 (1 L.S.I. 7) (a period which has continued up to the present day).

13 In view of the approach adopted by Shamgar P., no express answer was actually given by the Court to the question whether the reasons presented by the respondents for the adoption of the general policy imposing a freeze on new hospitals did, in fact, constitute reasonable grounds for believing that the making of the Order was necessary for the maintenance of regular hospital services. One of the main points to emerge from the judgment is that even if this question were answered in the affirmative, so that both the policy and the resulting Order could be viewed as reasonably justified, this in itself could not justify the manner in which the respondents had dismissed the petitioner's application for registration.

14 In putting forth this proposal the respondents were acting in accordance with the “Rules for the Prevention of Conflicts of Interests of Elected Official of Local Authorities”. These rules were recommended by a special committee, and had been adopted by the municipal government administration. Under these rules an advisory council had been set up which, faced in the past with facts like those of the present case, had reached decisions similar in substance to the proposal now put forward by the respondents.

15 Barak J. referred to three such considerations: (i) the duty of trust which public officials owed to the public in the fulfillment of their functions; (ii) considerations based on the requirements of fairness, good faith and natural justice; (iii) general considerations related to the requirements of proper administration.

16 Per Maltz J. in Ravivo v. Head of Ofakim Local Council (1988) 42(iii) P.D. 183, at 185.

17 Both approaches or tests were formulated in Ravivo v. Head of Ofakim Local Council, Ibid., the first approach representing the minority view, while the second represented the majority view.

18 Hence, Barak J. in effect accepted the proposal put forward by the respondents. See supra n. 14.

19 The Hebrew term “kashrut” means propriety, fitness, or lawfulness. More specifically, however, the term is usually used to refer to Jewish dietary laws.

20 The term “eating house” is defined in sec. 1(a) of the Law as “a place where the sale or serving of commodities to the public for consumption on the spot is carried on … in the case of a hotel … the part of the hotel where the preparation or serving of commodities for consumption on the spot is carried on”. The term “commodity” is defined as “food and drink …” (37 L.S.I. 147).

21 37 L.S.I. 148.

22 The term “halakhic” or “halakha” means law or rule, and refers to the legal body of Jewish traditional literature Jewish law. See, e.g., G. Beresford & others v. Ministry of Interior (1989) 43(iv) P.D. 793, especially the judgment delivered by Barak J. and his statements concerning the proper interpretation of the term “Jewish” as defined in sec. 4B of the Law of Return, 1950, (Law of Return (Amendment No. 2), 1970 (24 L.S.I. 28)). A digest of this case appears in (1991) 25 Is.L.R. 227Google Scholar.

23 Supra n. 21.

24 Sec. 75 of the CAL provides: “Where an advocate has been convicted in an ordinary court or a court-martial, by final judgment, of a criminal offence, a District Court of Discipline may, upon the application of an accuser, impose on him one of the penalties mentioned in section 68 if it finds that in the circumstances of the case the offence involves ignominy”; sec. 68(4) of the Law provides: “The following are the penalties which a Court of Discipline shall be competent to impose on a person convicted of a disciplinary offence: … suspension for a determinate period not exceeding five years” (15 L.S.I. 196).

25 Sec. 18 of the Law provides: “The President of the State may shorten or quash the period of prescription or extinction of any person …” (35 L.S.I. 398, at 404). As for the meaning of the term, “period of prescription”, see infra n. 41.

26 The exact nature of the specific claims made by the appellant in the context of this argument is elucidated further below in the text, and in n. 45.

27 Under sec. 1(a) of the Law the police are under an obligation to keep a crime register containing particulars of registration of every person who is the subject of a conviction. Such particulars include convictions and penalties awarded by a court or tribunal in criminal proceedings for felonies or misdemeanours. Sec. 3 of the Law prohibits the delivery of information from the register save in accordance with the Law itself.

28 For examples of exceptions see infra nn. 38, 42 and 43.

29 For an explanation of the concept of “extinction” in the present context see text below and n. 42.

30 This point can be understood only in relation to the Hebrew title of the Law which includes the term “Takanat Hashavim”. The verb “shav” means “return” and is closely related, both linguistically and conceptually, to the concept of “teshuvah”. Elon D.P. pointed out that the term “Takanat Hashavim”, which sprang from the Mishnah Gitin, is closely associated within Judaism with acts aimed at fostering repentance and rehabilitating criminal offenders. He further noted that the Jewish roots of the Law's title were expressly referred to in the proposal of the Law brought before the Knesset.

31 Mishnah, , Makot, 3, 15Google Scholar.

32 Book of Deuteronomy, 25: 2–3Google Scholar.

33 The term “Midrash” refers to homiletic interpretation of the Scriptures.

34 Sifrei (Finklestein), Davarim, , Parashat Ki-Titze, line 286, p. 304Google Scholar.

35 The followers of Rabbi Hillel generally adopted a more moderate approach to moral and legal questions than the rival school headed by Rabbi Shammai. With regard to the question referred to in the text, Beit Shammai was of the opinion that the thief was under an obligation to return the beam itself.

36 Rashi, , Gitin, 55Google Scholar, 1.

37 In this context, Elon D.P. cited two illustrative passages from Rambam, , Torah, Mishneh, Teshuvah, 7Google Scholar.

38 The example of the public office given in the sources, referred to by Elon D.P., is membership in the “Sanhedrin”, the assembly of 71 ordained scholars, which served as both supreme court and legislature. These sources include Mishnah, , Makot, 2, 8Google Scholar; Rambam, , Sanhedrin, 16, Halachot 7–9Google Scholar; and HaRitbah, Hidushei, Makot, 13Google Scholar, 1. While Rambam appears to suggest that the commission of any offence was sufficient to disqualify the offender from serving in the Sanhedrin, it seems to have remained an open question whether such disqualification should not be limited to the commission of serious transgressions such as homicide. In any case, it should be noted in this context that the Law does not, for example, prohibit the delivery of information pertaining to a conviction, even after the extinction of the conviction, to certain specified bodies whose task it is to appoint high office-holders, such as the President of the State, the State Comptroller and judges, (sec. 16(a) of the Law and First Schedule, supra n. 25).

39 See infra n. 43.

40 34 L.S.I. 181.

41 Sec. 14 of the Law establishes a number of different periods of prescription (depending on the severity of the penalty imposed) and states that no information from the register shall be delivered under secs. 6 to 9 of the Law where the relevant period of prescription has elapsed since the date of the sentence. Secs. 6-9 deal with the delivery of information from the registry for certain defined purposes, such as the granting, renewing or cancelling of licences under enactments, the holding of publicoffice and participation in a tender competition arranged by a public body.

42 Sec. 16(a) of the Law provides: “When ten years have passed since the expiration of the period of prescription … (such ten years hereinafter referred to as ‘the period of extinction’), the conviction shall be deemed extinguished and no information on it shall be delivered save to the bodies specified in items (b) to (e) of the First Schedule” (35 L.S.I. 402).

43 Neither of these arrangements offers the individual offender complete protection of his interests. Indeed, the Law as a whole constitutes a complex attempt to strike a delicate balance between the needs of the offender, on the one hand, and the protection of society, on the other. In this sense, even the determination of a ten year period of extinction, rather than some shorter or longer period, reflects the legislator's attempt at compromise. In general, however, the arrangement concerning the extinction of convictions offers the offender greater protection than the arrangement concerning the prescription of offences. Hence, where the period of prescription, but not the period of extinction, has expired, information on it may still be delivered to the courts. A further example of how the effects of extinction are wider than those of prescription is provided by the appellant's final claim: see text above and comparison of secs. 19(c) and 20(a) of the Law.

44 Sec. 19(a) of the Law provides: “No information on a conviction which has prescribed shall be taken into account by a person who, but for the prescription, would have been entitled to receive the information” (35 L.S.I. 404).

45 The disciplinary offence of which the appellant was convicted pursuant to sec. 75 of the Law was constituted by the appellant's criminal conviction, together with the finding concerning the Ignominy” of the criminal offence. Hence, in the absence of information pertaining to the criminal conviction, no foundation would remain upon which to base the disciplinary conviction.

46 Sec. 14 of the Law. See supra n. 41.

47 Sec. 5(a) of the Law provides: “The Police shall deliver information from the Register to the Authorities and office-holders specified in the First Schedule” (35 L.S.I. 399). Among the authorities listed in the First Schedule are courts and tribunals, “if … die disclosure is relevant to the subject-matter of the hearing…” (35 L.S.I. 408).

48 Sec. 19(c) of the Law provides: “A disqualification imposed on a person, for a period determined by enactment, in consequence of a conviction shall cease when the period determined by this Law for the prescription of the conviction has expired” (35 L.S.I. 404).

49 Sec. 20(a) of the Law provides: “A person whose conviction has been extinguished shall, for the purposes of any law, be deemed not to have been convicted, and every disqualification imposed on him by reason of the conviction, whether by enactment or by judgment, including a judgment in a disciplinary proceeding, shall be void from the date of the extinction; but the extinction shall not affect what has been done in consequence of the conviction” (35 L.S.I. 404).

50 The term “prescription” is the translation of the Hebrew term adopted by the L.S.I., which might otherwise be translated as “limitation”.

51 Joachimson v. Swiss Bank Corporation [1921] 3 K.B. 110 (C.A.).

52 Sec. 6 of the Law provides: “The period of prescription shall begin on the day on which the cause of action accrued” (12 L.S.I. 129).

53 In other words, the law in force before both the Contracts (General Part) Law, 1973 (27 L.S.I. 117) and the Foundations of Law, 1980 (34 L.S.I. 181) had been passed. The latter, by repealing Article 46 of the Palestine Order-in-Council, 1922/1947, severed the link between English law and Israeli law. Article 46 required Israeli courts to fill lacunas in Israeli law by reference to English law. However, Barak J. held that in any case, in view of the existence of fundamental principles (such as the principle of good faith and the principle according to which the purpose of a contract was to realize the reasonable expectations of the parties) from which a specific solution could be derived, no such lacuna existed with respect to the legal question raised in the further hearing. In deriving such a specific solution, however, inspiration could also be gained from other legal systems, including the English legal system.

54 As supportive of this view Barak J. referred, inter alia, to the positions presented in Thomas, S. and Megrah, M., Banker and Customer (London, 5th ed., 1947) 140Google Scholar and Michie, A., On Banks and Banking (Chariots Ville, 1983) vol. 5B, p. 126Google Scholar.

55 Joachimson, see supra n. 51.

56 As supportive of this view Barak J. referred, inter alia, to Lloyds Bank Ltd. v. Margolis [1954] 1 All E.R. 734 (Ch.) and Reeday, T.G., The Law Relating to Banking (London, 5th ed., 1985) 48Google Scholar.

57 As supportive of the middle-of-the-road view Barak J. referred, inter alia, to Gossard v. Gossard 149F. 2d 111 (1945) and In re Fallon's Estate 124 N.W. 994 (1928).

58 Barak J. said that in a number of English cases the courts had treated contracts which said nothing at all as to the time of repayment as cases where repayment was to be on demand. In addition, Barak J. criticized English cases (e.g., Bradford Old Bank v. Sutcliffe [1918] 2 K.B. 833 (C.A.)) in which, despite the parties' express use of the term “on demand”, the court had treated the debt as repayable immediately without the need for any prior demand.

59 In this context, Barak J. referred to two general principles or sets of principles: firstly, the principle requiring good faith in the performance of legal acts; secondly, general principles which lay at the foundation of the rules and policy concerning prescription, and which justify the giving of notice within a reasonable time in order to safeguard the interests of both the debtor and the public. Within this broad latter category Barak J. referred to three considerations related to the litigants: (i) An evidentiary consideration concerning the difficulty of ensuring, over an extended period, the means of proof. Fairness towards the debtor required that a time arrive when he could release himself from the danger of a suit; (ii) the pace of modern life which requires that each individual know what his rights and obligations are; (iii) the passage of time from which a waiver or forebearance might be inferred. In addition, Barak J. referred to considerations related to the public interest, namely, that the courts' limited time be devoted to conflicts pertaining to the present rather than the distant past.

60 12 L.S.I. 66, as amended in the Criminal Procedure Law, 1965, sec. 225 (19 L.S.I. 158, at 187). Sec. 19 defines the term “interested person”, appearing therein, as “a spouse, parent, grandparent, descendant, brother or sister of the deceased person” (12 L.S.I. 69).

61 Ibid.

62 Sec. 30 of the Law provides: “An investigating judge may decide — (1) that the evidence produced to him is sufficient to prove the cause of death, and what are the results of the investigation; (2) that the evidence produced to him is not sufficient to prove the cause of death. The investigating judge shall forward a copy of the decision to the police and to the District Health Office” (12 L.S.I. 70).

63 Ibid.

64 12 L.S.I. 107.

65 Sec. 62 of the Criminal Procedure Law (Consolidated Version), 1982, provides: “Where it appears to the prosecutor to whom the investigation material has beentransmitted that there is sufficient evidence to charge a particular person, he shall prosecute him unless he is of the opinion that no public interest is involved …” (36 L.S.I. 48).

66 The respondent emphasized that as a result of the findings of the Bejski Commission, internal sanctions had been imposed on those involved resulting in dismissals from work and exclusion from the banking profession.

67 In addition to the respondent's decision concerning the banks and bankers, the petition also dealt with the respondent's decision concerning the accountants who had been responsible for the preparation of the banks' financial reports. After having first decided that there was no public interest in the prosecution of the accountants, the respondent referred the allegations made against them to the auditors' council. Barak J. held that a proper balancing of competing considerations required that the respondent first receive the findings of the auditors' council, and only then decide whether the accountants should be prosecuted.

68 All three approaches are analyzed in Major (Reserves) Yehuda Ressler, Attorney & others v. Minister of Defence (1988) 42(ii) P.D. 441, a digest of which appears in (1990) 24 Is.L.R. 133Google Scholar.

69 Sec. 58 of the CPL provides: “Any person may complain to the police that an offence has been committed” (36 L.S.I. 47); sec. 64 provides: “In the case of a decision not to investigate or not to prosecute, whether for lack of public interest or for lack of evidence, the complainant may lodge objection with the Attorney-General …” (36 L.S.I. 48).

70 Barak J. describes the Attorney-General as the “first and foremost” of the prosecutors, a description supported by sec. 12(a)(1) of the CPL which opens its list of prosecutors by referring to the Attorney-General and his representatives.

71 With respect to this analysis of the concept of “reasonableness”, Barak J. refers, inter alia, to Stone, J., Legal System and Lawyer's Reasoning (Stanford, 1964) 263Google Scholar (Stone refers to the concept as a “legal category of indeterminate reference”), and to Mansfield, G. and Peay, J., The Director of Public Prosecutions (1987)Google Scholar, from which he quotes the following extract: “Decision making on grounds of public interest recognizes that competing values within any complex society must be reconciled. Thus the prosecutor's extra legal considerations involve the balancing of different types of harm: the harm done, or avoided as a result of prosecutorial action or inaction. The balance striven for may be characterized as pursuit of a society's ‘net interest’ in whatever issue is under consideration” (p. 27).

72 In addition, Barak J. noted, with regard to the question of discrimination, that although for lack of evidence concerning similar cases the Court could not conclusively determine that the respondent's decision had been discriminatory, persons suspected of having committed far less serious offences, leading to less severe damage than those committed by the suspects in the present case, were prosecuted daily as a matter of course.

73 The summary of the present case has not referred to the opinion delivered by Shamgar P. It should be noted, however, that Shamgar P. concurred both with Barak J.'s conclusions, as well as with the criteria applied by him, and the case was decided in accordance with the latter's judgment. Shamgar P. did emphasize that the Court would not intervene in a decision reached by a statutory authority merely because the Court itself, placed in the position of the authority, would have decided differently. However, the Court would not hesitate to intervene where the decision involved a material deviation from the “path” of reasonableness.

74 The regulations in question were: regulation 18 of the National Insurance Regulations (Disability Insurance) (Determination of Medical Disability Percentages, Appointment of Appeals Committee and Miscellaneous Provisions), 1984, and regulation 25 of the National Insurance Regulations (Determination of Disability Level of Persons Injured at Work), 1956. Both regulations grant patients a general right to have the relevant medical information delivered to them personally upon request. This general right, however, is subject to exceptions which result from the exercise of discretion given to national insurance medical officials allowing them to decide, in certain cases, that the information in question should be conveyed only to patients' representatives.

75 The doctrine of res judicata applicable under Israeli law was taken over from the English law doctrine and consists of two main rules: estoppel relating to the cause of action and estoppel relating to a certain issue. The present case involved the latter. The rule is that if, in the course of the first proceedings, a certain question of fact, the determination of which was essential to the outcome of the case, was in fact determined, impliedly or expressly, then the same litigants will be estopped, in the course of subsequent proceedings, from raising the question again, even if the cause of action in the second proceedings is different from that in the first. (See Kedmi, , On Evidence: The Civil Face (Dyonon, Tel-Aviv University, 1989) 187–188)Google Scholar. As the present case makes clear, however, this kind of estoppel will also apply where the question determined was one of law, rather than a purely factual question.

76 Reference was made to Arbiv & others v. State of Israel (1973) 27(ii) P.D. 513, and Bachar v. Attorney General (1952) 6 P.D. 415.

77 S. Levine J. referred explicitly to the Doctrine's role in preventing inconsistent judgments, in preventing the abuse inherent in repeated and unjustified prosecution of an accused, and in encouraging the litigants to gather all of their evidence, and to raise all of their claims, during the course of the first proceedings.

78 S. Levine J. referred essentially to circumstances similar to those of the present case. He cited the example of a person acquitted of the offence of importation of goods without a licence where the acquittal rested on the classification of the goods as exempt from customs payments. If, following the acquittal, the said classification of such goods is reversed by a new ruling, it would be unjust, according to S. Levine J., to grant the importer “immunity”, on the basis of the decision reached in the first proceedings, from all future prosecutions relating to the subsequent importation by him of the same goods.

79 Bokovza v. D. Shiri & others (1983) 37(iii) P.D. 622.

80 Tel-Aviv-Jaffo Municipality v. Cohen (1964) 18(iii) P.D. 302.

81 These three considerations were first formulated in the case referred to supra n. 80.

82 S. Levine J. illustrated this consideration by referring to a hypothetical case where the appellants had been convicted in the first proceedings, and thereafter, in other proceedings based on the same facts, a new ruling had been given concerning the interpretation of the building permit which resulted in the acquittal of the accused. S. Levine J.'s point is that, in these circumstances, the application of the Doctrine against the appellants, and in favour of the State, would be unjust.

83 Equality in the sense of arriving at the same (correct) decisions in subsequent similar proceedings between different litigants. Hence, inequality would arise if the Doctrine were applied despite the fact that between the first and second proceedings a number of decisions were given in similar cases between different litigants which all reversed the decision given in the first proceedings.

84 In this context S. Levine J. referred to the following extract: “The ultimate question in determining the application of res judicata must be whether the prevention of redundant litigation of an issue justifies foreclosing a showing of the truth … it would seem to be an unnecessary hardship to apply a rule of law now determined by an authoritative court to be erroneous, and which would not now be followed in actions between other parties” (from Note, , “Application of Res Judicata to Questions of Law in Different Causes of Action” (1941–1942) 55 Harv. L. R. 120Google Scholar.