An Israeli court has ruled against an insurance agency that attempted to settle a legal debt using thousands of low-denomination coins—without clear documentation. The unusual payment method, while technically legal, was deemed insufficient after the plaintiff claimed he had not received the full amount.
The case began with a ruling by a small claims court last year ordering the agency to pay NIS 600 (approximately $160) to a private individual. Instead of transferring the funds electronically, the agency delivered the sum in coins and bills—specifically, thousands of 10-agorot coins (each worth roughly 3 cents USD). The plaintiff said the payment was incomplete and filed for enforcement with the national debt collection agency.
Last week, a registrar with the Law Enforcement and Collection Authority sided with the plaintiff, stating the agency failed to prove it had paid the full amount. The court ordered the company to forfeit a NIS 700 deposit and pay an additional NIS 3,000 in legal fees.
The agency claimed it had delivered the funds directly to the plaintiff’s home, counted the money at least three times and provided video evidence of the coins being counted by a machine and left in cloth bags outside the plaintiff’s door. The plaintiff, an attorney known for filing lawsuits over spam messages, argued the move was retaliatory and humiliating.
Initially rejecting the payment as improper, the plaintiff later spent hours sorting and counting the coins. He claimed the bags contained only NIS 543.70, far short of the NIS 600 judgment, and included some worthless foreign currency. A bank deposit later confirmed just 4,000 valid coins. He also paid a NIS 102.50 fee to process the bulk coin deposit.
The agency cited Israel’s penal code, which states that refusing to accept legal tender is a criminal offense. It insisted it had paid in full and denied any intention to deceive or harass the plaintiff. It offered to pay the missing balance and cover the deposit fee as a compromise, but the plaintiff refused.
The court ultimately found the agency’s documentation insufficient and upheld the enforcement claim, warning others that even legal tender must be clearly documented when settling debts.
Legal but petty
A Tel Aviv registrar with the Enforcement and Collection Authority ruled that a debtor’s decision to repay a court-ordered debt using bags of small coins—rather than a bank transfer—was legal, but unnecessarily provocative and poorly documented.
The ruling noted that the creditor had promptly provided the debtor with his bank details and suggested the payment be made via wire transfer. The debtor, however, opted to deliver the amount in coins along with two NIS 20 bills. “While this method of payment is not prohibited by law,” the registrar wrote, “the debtor was obligated to thoroughly document the counting process and the amount left in the bags.” The debtor admitted it did not fully document the procedure.
Video footage submitted by the debtor merely showed coins being counted with a machine and later delivered to the creditor’s doorstep. The registrar concluded that the evidence was insufficient to confirm that the full court-ordered amount—NIS 600—was actually provided.
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The registrar also dismissed the debtor’s claim that the creditor, acting in bad faith and out of spite, had deliberately undercounted the money. “This accusation is unsupported by evidence,” the ruling stated. “The debtor had the burden to properly document the entire sum. Having failed to do so, it has only itself to blame.” The registrar added that the debtor’s behavior appeared petty and intentionally provocative.
The court ordered the release of a NIS 700 deposit to the creditor and awarded him an additional NIS 3,000 in legal costs.
Attorney Ilan Hazani, a debt collection expert not involved in the proceedings, said the case underscored the importance of fair conduct by debtors. “Paying with small coins isn’t new—and courts have previously criticized such tactics,” Hazani noted. “Even if technically lawful, it’s seen as abusing a formal right to inconvenience the other party. In this case, the debtor ended up paying five times the original debt—this should serve as a warning to others considering such strategies.”