Property Gifted Before the Wedding – Who Gets the Apartments After the Divorce?

A woman received two plots of agricultural land from her father just weeks before her wedding. Over 23 years of marriage, her husband worked to get one plot rezoned for housing, managed the apartments built on it, and ran the sale proceeds and rental income through the couple’s joint accounts. After their divorce, the Supreme Court ruled that he is entitled to half of the five remaining apartments, including the value of the original land, because the couple’s conduct over the years showed a clear intention to share the property.

By Adv. Eden Bariel Stoklov, with the assistance of legal intern Yasmin Pailiev

In this case summary, we review a Supreme Court decision on what is known as the “specific partnership rule.” This is a legal principle that, depending on the circumstances, allows a spouse to be recognized as having rights in an asset that belonged to the other spouse before the marriage, or that the other spouse received as a gift or inheritance. However, this kind of partnership is not created automatically. It must be proven that the couple’s conduct shows an intention to share that particular asset. In this ruling, the Supreme Court reviewed the decisions of the lower courts, examined how the couple treated the property throughout their marriage, and considered whether, in the circumstances of this case, an intention to share had been proven regarding property built on land the wife had received as a gift from her father before the marriage.

The Facts of the Case:

The couple married in 1996, had three children, and separated in 2019 after about 23 years of marriage. A few weeks before the wedding, the wife received two plots of agricultural land in the city of Ness Ziona as a gift from her father, and they were registered in her name alone. In 2002, the planning authorities rezoned one of the plots from agricultural use to residential use. Following the rezoning, the wife entered into a combination deal with a developer – an arrangement in which a landowner gives part of the land to a builder and receives finished apartments in return. Under the deal, she sold part of the land to the developer and, in exchange, received 7 apartments in the building that was to be built on it. She later sold 2 of those 7 apartments, and the proceeds were deposited into the couple’s joint account, leaving 5 apartments in her ownership.

Over the years, the husband worked to get the land rezoned from agricultural to residential, managed all the activity relating to the 5 remaining apartments, handled all the tax matters, managed the rentals, and stayed involved in running the apartments after construction was completed. In addition, both the proceeds from the sale of the 2 apartments and the rent from the remaining 5 passed through the couple’s joint accounts.

After the couple separated, the husband sued for about half of the rights in the Ness Ziona apartments. He argued that the way they had managed things together over the years showed that the wife intended to share the apartments with him. Alternatively, he claimed about half of the increase in the land’s value as part of the division of assets under the Spousal Property Relations Law.

The wife, on the other hand, argued that the land was an “external” asset she had received as a gift before the marriage, and therefore should not be shared. She claimed that even if there was an intention to share the apartments, a distinction must be made between the land itself and the apartments, and between “active” appreciation (an increase in value resulting from the couple’s efforts) and “passive” appreciation (an increase resulting from a general rise in value). She further argued that the specific partnership rule should not apply to assets other than the family home, or at the very least, that applying it to such assets requires explicit proof, either in writing or in front of witnesses.

The Legal Question:

Is the husband’s involvement in the combination deal – including getting the land rezoned, managing the apartments, and handling the tax and rental matters – enough to prove a specific intention to share the apartments?

The Court’s Decision:

The case was first heard in the Family Court, which ruled that the husband had proven an intention to share the five apartments, and that the apartments therefore belong to both spouses in equal shares. However, the court also ruled that the land itself, in its original state as agricultural land given to the wife before the marriage, was not shared. Accordingly, it ruled that the husband must pay the wife the value of the land as agricultural land. The husband appealed, and the District Court left that ruling in place.

When the husband appealed the District Court’s decision to the Supreme Court (a “third-round” appeal, which can only be heard with the court’s permission), the Supreme Court explained the legal position on the partnership rule. The general rule is that an asset owned by one spouse before the marriage, or received as a gift or inheritance, is not included in the division of assets and is therefore not split between the spouses. The exception is that, even for such an asset, the other spouse’s rights can be recognized under general law where a specific intention to share that asset has been proven. In other words, the specific partnership rule allows a spouse to prove that the couple agreed to share a particular asset. That agreement does not have to be explicit or in writing. It can be inferred from the couple’s behavior, from how they presented things, from how they handled their finances, from their investments, and from the way the asset was managed.

Ruling on the husband’s appeal, the Supreme Court held that the fact that the land was given to the wife as a gift before the marriage does not, on its own, prove that the couple intended to keep it out of the partnership. After all, a person can receive an asset as a gift and later decide to share it with their spouse. The court added that under Section 12 of the Land Law, ownership of land also covers whatever is built on it or permanently attached to it, and under Section 13 of the Land Law, a land transaction applies to the land together with everything attached to it. Therefore, without a clear indication that the couple agreed otherwise, it is difficult to separate ownership of the apartments from ownership of the land they are built on.

The Supreme Court accepted the husband’s claim and rejected the wife’s position. It ruled that the husband is entitled to half of the rights in the 5 apartments in Ness Ziona, without deducting or excluding the value of the agricultural land that the wife owned before the marriage. The wife was ordered to pay the husband’s legal costs of NIS 5,000.

[Family Leave to Appeal 5620/24, 17735-09-24, Anonymous v. Anonymous (June 30, 2025)].