A customer is not paying: how to collect a debt through the Execution Office or a lawsuit

Service page: Debts and enforcement proceedings: what to do, and in what order — for debtors and businesses.

A customer is not paying: three tracks, and what decides which one fits

The first question is what you hold:

You file the cheque or the claim for a fixed sum without waiting for a judgment. If the customer objects, the file moves to the court; and if the court accepted the objection, you pay the balance of the court fee, less what was paid at the Execution Office.

A bounced cheque or a promissory note: direct execution at the Execution Office

A cheque, a promissory note and a bill of exchange can be enforced like a judgment. You file a request to execute the instrument with the Execution Office, and the Execution Office serves an official warning on the customer. The customer has 30 days from service of the warning to file an objection, instead of the usual 20 days.

Two things to check before filing:

• A cheque that the bank may not honor under the Reduction of the Use of Cash Law, 5778-2018 (חוק לצמצום השימוש במזומן, התשע״ח-2018) — a cheque without the name of the payee, or an endorsed cheque for more than NIS 10,000, if it does not state the names of the endorser and the endorsee and the endorser’s ID number, or if it was endorsed more than once (subject to the exceptions in the Law) — cannot be filed as a negotiable instrument, only under the warning conditions of a claim for a fixed sum.
• Limitation period: a claim on a cheque becomes time-barred after 7 years against the drawer, and after two years against an endorser.

A cheque bounced — what do you do now?.

A fixed-sum debt of up to NIS 75,000: a warning, then a claim for a fixed sum

A claim for a fixed sum fits a debt of a known amount that comes from an express contract or undertaking and is supported by written evidence, or a debt whose amount is set expressly by law, up to NIS 75,000 on the day of filing. The order:

1. You send the customer a warning that you intend to file the claim with the Execution Office, by registered mail with confirmation of delivery. The warning follows the wording of Form 19A, and sets out the amount of the claim, the main facts, the details of the contract or undertaking and the date on which the debt arose, and the supporting documents.
2. You wait 30 days. You file the request when 30 days have passed from service, and no later than one year; after one year a new warning is needed.
3. You file with the Execution Office the statement of claim, the documents, the warning and the confirmation of delivery, and the customer’s reply if they replied.
4. The Execution Office serves an official warning. The customer has 30 days to object, including on the ground that the debt is not a “fixed sum”. The Execution Registrar transfers to the court a claim that does not meet the conditions.

An ordinary warning letter before a claim in court is not a general requirement, and it does not stop the limitation period. The warning before a claim for a fixed sum is something else: without it, there is no proceeding. A warning letter before a claim.

“Summary procedure was abolished”: what remains

The Civil Procedure Regulations, 5779-2018 (תקנות סדר הדין האזרחי, התשע״ט-2018), apply to proceedings opened from 1 January 2021, and they have no chapter on “summary procedure”. Two things remain and serve the same purpose:

• Leave to defend. A customer who objected at the Execution Office to a cheque or to a claim for a fixed sum may defend in court only if the court gave them “leave to defend”. The decision is made on the basis of the objection and the cross-examination of the affiant, and it can be made conditional on security being given.
• Expedited proceeding (formerly: “fast-track procedure”). A claim in the Magistrates’ Court of up to NIS 75,000 is heard in an expedited proceeding: a statement of defense within 45 days, a pre-trial hearing within 90 days, a hearing within six months of the last statement of defense, and a judgment within 14 days of the end of the hearing.

And if the customer did not file a statement of defense on time, the court may give judgment on the basis of the statement of claim alone.

A claim in court: the Magistrates’ Court, the expedited proceeding, and why small claims do not fit a company

• The Magistrates’ Court hears monetary claims of up to NIS 2,500,000 on the day of filing. The fee is 2.5% of the amount and no less than NIS 893 in 2026, and it is paid in two halves: half on filing and half up to 20 days before the first hearing. In a judgment in default of defense, the second half is not paid.
• Small claims are open only to an individual, up to NIS 39,900 in 2026, and not under a right that was assigned. A company cannot sue there; a business owner who is a private person and not a company sues there as an individual. The court may transfer to the Magistrates’ Court a claim by someone who has already filed more than five claims in the same court in the same year (section 60(b)). The Small Claims Court: a practical guide.

After the judgment: opening a file at the Execution Office

A judgment that was not paid is filed for execution after the date set in it, and if no date was set, after 30 days from the day it was given. It is better not to wait: a request filed more than one year after it could have been filed limits what is added to the debt for the gap period to shekel interest only, although linkage agreed in the contract is kept. A debt of up to NIS 25,000 can be collected on the Execution Office’s abbreviated track, as long as the customer’s total debts in files do not exceed NIS 100,000.

Interest on the debt

On an amount awarded, the court may award shekel interest or linkage differentials; and if it was not paid on time, shekel interest is added by law, and from the end of three months after the payment date also late charges (sections 2, 5, 5A of the Adjudication of Interest and Linkage Law, 5721-1961 (חוק פסיקת ריבית והצמדה, התשכ״א-1961)). In a cheque file or a claim for a fixed sum, shekel interest is added to the amount from the payment date, and if the customer did not object, late charges as well; the request for interest is filed together with the request for execution, and interest agreed in the contract that is not contrary to law applies instead of them. A supplier whose business customer pays late is entitled, under certain conditions, to shekel interest and late charges under the Payments to Suppliers Law, 5777-2017 (חוק מוסר תשלומים לספקים, התשע״ז-2017). Interest and linkage on an unpaid debt: what the law allows you to demand.

The limitation period: do not delay acting on a debt

A monetary debt generally becomes time-barred after 7 years from the day the cause of action arose, usually the payment date, and a cheque after 7 years against the drawer and two years against an endorser. A partial payment or a written admission by the customer starts the count again. Prescription Law: the sections discussed on this site.

Frequently asked questions

Can you open a file at the Execution Office without a judgment?

Yes, in two cases: a cheque or a promissory note, and a claim for a fixed sum of up to NIS 75,000 based on a contract or an undertaking in writing, after a warning by registered mail (sections 81A, 81A1 of the Execution Law).

What counts as a “fixed sum”?

A known amount that comes from an express contract or undertaking and is supported by written evidence, or an amount that a law sets expressly. If the customer argues that the debt is not a fixed sum, they can object on that ground, and a claim that does not meet the conditions is transferred to the court.

How long do you have to wait after the warning?

30 days from service of the warning, and no more than one year. After one year you need to send a new warning.

The customer filed an objection. What now?

Execution is stayed and the file moves to the court. The customer will defend only if they receive leave to defend, and the court may make it conditional on security being given. If the court accepted the objection, you pay the balance of the court fee, less what was paid at the Execution Office.

Can a company file a small claim against a customer?

No. Only an individual may sue in the Small Claims Court, up to NIS 39,900 in 2026 (section 60 of the Courts Law). A company files in the Magistrates’ Court, and up to NIS 75,000 the claim is heard in an expedited proceeding.

Does “summary procedure” still exist?

No, in proceedings opened from 1 January 2021. What remains: leave to defend after an objection at the Execution Office (regulation 20), and an expedited proceeding for claims of up to NIS 75,000 (regulations 78–82).