Supreme Court rules for Jewish group in battle over Old City church leases

Supreme Court rules for Jewish group in battle over Old City church leases

Ruling ends 14-year legal battle by Greek Orthodox Church to overturn lease of 3 properties near Jaffa Gate to settler group; archbishop calls decision ‘illegal and illegitimate’

Sue Surkes is The Times of Israel's environment reporter.

Petra Hotel in Jerusalem. (DiggerDina, Wikipedia)
Petra Hotel in Jerusalem. (DiggerDina, Wikipedia)

In a major blow to the Greek Orthodox Church, the Supreme Court on Tuesday ruled that there was no reason to intervene in a lower court’s decision of 2017 that ruled in favor of a Jewish settler organization’s right to lease three church properties in a prime location in Jerusalem’s Old City.

Ateret Cohanim’s purchase of 99-year leases, renewable for an additional 99 years, through three front companies, had been challenged by the church, which claimed that the deals had been signed by a corrupt church official who had not been authorized to do so.

The court ruled that the church had failed to provide sufficient evidence that the agreements were made fraudulently.

In a statement, Palestinian Greek Orthodox Archbishop Atallah Hanna described the Supreme Court’s decision as “illegal and illegitimate.”

“The seizure of the historic Jaffa Gate properties by extremist settler organizations is a new catastrophe to the misfortunes suffered by the Christians in this Holy City,” he said, calling for the deal to be canceled in a lawful manner.

The Greek Orthodox Church is the largest and wealthiest church in the Holy Land.

According to court documents, front companies called Berisford Investments Limited, Richards Marketing Corporation, and Gallow Global Limited signed agreements with the church in 2004 to pay $1.25 million for the lease to the Hotel Imperial, $500,000 for the lease to the Petra Hotel, and $55,000 to lease a third property called Muzamiya House, also in the Old City.

Imperial Hotel, Jaffa Gate, Jerusalem. (DiggerDina/Wikimedia commons)

The two hotels — the New Imperial and the Petra — are located prominently between the Jaffa Gate and the start of the Arab souk.

Once regal properties, they today primarily serve tour groups and backpackers.

Ateret Cohanim works to populate the Old City and other East Jerusalem neighborhoods with Jewish residents by purchasing properties from non-Jewish owners, often through holding companies.

The sale of long-term leases to these properties — first revealed by the Maariv newspaper in 2005 — caused an uproar in the Palestinian community, which hopes that the Old City and Jerusalem’s Arab neighborhoods will form their capital under any future peace agreement.

The sale also led to the 2005 ouster and demotion to the status of monk of Patriarch Iranaios, who was in office when the deals were signed, and to his replacement, in 2007, by the current patriarch, Theophilus lll, who claims that the agreements were fraudulent.

Iranaios had always denied involvement in the agreement with Ateret Cohanim and was later cleared by the Palestinian Authority of the accusations against him.

Iranaios blamed his former finance director, Nikolas Papadimos, for using a power of attorney issued for other matters to sign the lease agreements without the patriarch’s knowledge.

Papadimos is no longer in Israel.

Screen capture from video of Greek Orthodox Patriarch Theophilus III during a press conference about the sale of church lands, November 2, 2017. (Screencapture/YouTube/)

In his ruling, Supreme Court Justice Yitzhak Amit said that despite church claims that the deal was like “a kind of Hollywood film in the center of which are intrigues, bribery and doubtful deals,” the patriarchate had failed to provide sufficient evidence that the agreements were made fraudulently.

However, he also denied a demand by the front companies for compensation to be paid to them because of the church’s refusal to let them take over the leases for the buildings.

The judges criticized the patriarchate for changing its story as the case dragged on over 14 years, noting that it had first claimed that the deals were void because they had not been approved by the Holy Synod.

Only later, in 2014, did it allege that Iranaios had signed the papers in exchange for a promise by Ateret Cohanim to secure him some kind of Israeli government recognition — a claim they had also failed to substantiate.

Matityahu (Mati) Dan, chairman of the Ateret Cohanim organization, seen during a tour in the Old City of Jerusalem on December 2, 2018. (Yonatan Sindel/Flash90)

While Papadimos, in Amit’s words, “probably wasn’t among the 36 righteous men” (a reference to Isaiah 30:18), the church had failed to prove that he had been paid $1 million “under the table” by Ateret Cohanim, as it had charged, the judge said. A draft affidavit from Papadimos and part of an edited recorded conversation between Papadimos and Ateret Cohanim chief Mati Dan were not admissible pieces of evidence. The church had failed to prove that Papadimos was corrupt, Amit said.

Furthermore, the church had claimed that Papadimos had stolen and used patriarchate checks to the tune of tens of thousands of shekels but had not, curiously, filed any complaints with police.

The church’s claim that the leases were priced far below market value was not upheld by surveyors, the ruling went on.

And the patriarchate had not renounced other agreements signed by Iranaios and Papadimos — just the three concluded with Ateret Cohanim.

The court also said it found no faults with the ruling of the lower court, which examined the issue in great depth over the nine years the case was before it.

Shortly after publication of the judgement, a senior church official told The Times of Israel that after a three-hour hearing on June 3, at which the church presented 20,000 pages of testimony, it was surprising that the Supreme Court had reached its decision so quickly, especially as a Jewish religious holiday — Shavuot — had fallen in the interim, shortening the working week.

Former Greek Orthodox Patriarch Iranaios seen in the apartment he holed himself up in in the Old City of Jerusalem after being deposed and demoted to the status of monk. He has since left the apartment. (YouTube screenshot)

The official said that the church was studying the ruling and also looking at new material to assess whether there was potential for further legal action.

The ruling symbolizes a huge victory for Ateret Cohanim.

However, the practical significance remains unclear, because the families that run the two hotels – the Dajanis at the New Imperial and the Kiresh family at the Petra — have protected tenant status rooted in an Ottoman-era law that caps rents and is supposed to prevent arbitrary evictions. The status of people living in the private home is not known.

Protected tenant status – which passes through three generations, down the male line — was abolished after Israel conquered East Jerusalem during the 1967 Six Day War. But it still technically applies if the status began before 1968.

Protected tenants can be evicted after three generations have died, or beforehand if the Israeli courts can be persuaded that the status was erased by activities such as subletting.

Organizations including Ateret Cohanim have tried and continue to try to evict protected tenants in a number of cases in East Jerusalem, including in the Old City.

AFP contributed to this report

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