Signing a contract without reading or understanding it – is it possible to cancel?

A contract is a document (or Oral commitment which can be proven) that includes the rights and obligations of two or more people, one in relation to the other. Signing a contract means that the parties to the contract assume those rights and obligations and undertake to act in accordance with the provisions of the contract. A person who signs the contract and does not fulfill its provisions exposes himself to legal proceedings in which he may pay financial compensation to the other party.

What is the legal meaning of signing a contract?

חתימה על חוזה משמעותה שהצדדים לחוזה קראו את החוזה, הבינו את החוזה והסכימו לתנאים. טענות כגון "לא הבנתי על מה חתמתי" מתקבלות לעיתים נדירות בבתי המשפט.

חתימה על חוזה בלי לקרוא או להבין אותו
Contract lawyer Eddie Blitstein explains signing a contract

Signature issue contract can be found in many judgments. For example, in the context of Class action lawsuit (ת"צ 43231-02-17 יש-אל מפס בע"מ נ' שלמה כ.א.ל בע"מ, החלטה מיום 1.12.2019) נקבע, בין היתר, כך:

The applicant also attached to her response the agreement Selling the leased Kia vehicle For the sum of 55,000 NIS. The applicant's manager admitted that he signed the document. The rule is that a person who signs an agreement (not under duress or improper circumstances) will not generally be heard on the grounds that he signed without understanding the content of the document or that his signature is not sufficient to express his agreement to its terms.

"The rule is that a person who signs a document is presumed to have read it and understood its contents and to have signed it as a sign of his consent, especially when it is a material document in relation to his assets... It was further ruled that the person seeking to rebut this presumption must prove his version with positive evidence as a close possibility.." (השופטת א' חיות בע"א 6799/02 יולזרי נ' בנק המזרחי המאוחד בע"מ, פ"ד נח(2) 145, 149 (2003), תוך הפניה לע"א 1513/99 דטיאשוילי נ' בנק לאומי לישראל בע"מ, פ"ד נד(3) 591 (2000); ע"א 6645/00 עו"ד ערד נ' אבן, פ"ד נו(5) 365 (2002)). (ר' גם ע"א 1598/96 Union Bank v. Lupo פד"י נד (2) 559; ע"א 9136/02 מיסטר מאני ישראל נ' רייס, פד"י נח (3) 934).

באופן דומה נקבע בבית הדין לעבודה בת"צ 13586-09-13 נדרה עובדיה נ' רשת חנויות רמי לוי שיווק השיקמה 2006 בע"מ (החלטה מיום 10.6.2019), בין היתר, כך:

In accordance with the ruling – "אדם מוחזק כמי שיודע את תוכנו של מסמך עליו הוא חותם, ומי אשר לא טרח לקרוא הסכם עליו חתם, אין לו להלין אלא על עצמו בלבד" (ר': ע"א 467/64 שוויץ נ' סנדור, פ"ד יט(2) 113 (1965); ע"א 1513/99 דטיאשוילי נ' בנק לאומי לישראל בע"מ, פ"ד נד(3) 591 (1999)). דברים אלו מקבלים משנה תוקף, שעה שמדובר במסמך קצר אשר מנוסח בעברית פשוטה.

As you can easily see, the position of the courts is that signing a contract binds the person who signed it, certainly when it is a short document. The burden of proving, after signing the contract, that the signer did not understand its contents is on the person making the claim. The likelihood that the claimant will be able to meet the burden of proof and prove that he did not actually understand what he signed is very low (and will not necessarily help), and the higher the education of the claimant, the greater the difficulty.

Filing a lawsuit after signing the contract and claiming that the signer did not understand its contents can also indicate Bad faith on the part of the plaintiff. This may affect the amount of legal costs that will be awarded to the plaintiff if the court decides To dismiss the claim.

חתימה על חוזה
Signing an agreement

In what cases can it be claimed after signing a contract that the signer did not understand its contents?

Signing a contract in a language the signer does not understand can be a good reason to file a lawsuit. Civil lawsuit and demand Cancel the contract On the grounds that the signer did not understand its contents. However, signing a contract in this case may raise the question of why someone would sign a contract in a language they do not know and in a situation where they do not understand all the terms of the agreement. Even if after signing a contract in this case the court orders its cancellation, there is a likelihood that the court will require the signer to pay some amount of compensation for his failure (signing a contract in a language he is not familiar with).

Another situation in which the court may consider the plaintiff after signing a contract is when it is a very elderly person. Even if there is no strong legal argument, in these cases the courts show great empathy for elderly people. It is important to understand that not every situation in which an elderly person is involved in the signing of a contract will result in the court ordering the cancellation of the contract. It all depends on the circumstances of the case.

Signing a contract by an uneducated or ignorant person (such as someone who cannot read or write at all) can lead to a situation in which that person can claim that they did not understand the contents of the contract.

Signing a contract that constitutes oppression (a contract with unreasonable terms compared to what is customary in the market) can also lead to the cancellation of the contract on the grounds that the signer did not understand the content of the contract. It is important to be familiar with the provisions of Section 18 of the Contracts Law, which states:

A person who entered into a contract due to the exploitation by the other party or someone else on his behalf of the contracting party's distress, mental or physical weakness, or inexperience, and the terms of the contract are unreasonably worse than what is customary, may cancel the contract.

עורך דין חוזים
Need legal advice on signing a contract? Contact Attorney Eddie Blitstein

In conclusion

חתימה על חוזה מחייבת את החותם. לא ניתן לטעון בשלב מאוחר יותר "לא ידעתי על מה חתמתי" – טענות מסוג זה אינן מתקבלות בבית המשפט.

There are exceptional cases in which it is possible to demand the cancellation of an agreement after it has been signed. These exceptional cases mainly deal with the failure of the signatory (for example, a demand to sign a contract in an incomprehensible language) or the exploitation of the signatory's distress (for example: if the contract is not signed now, something very bad will happen) or the exploitation of the signatory's inexperience with the contract.

In these exceptional cases, it is advisable to consult with Contract lawyer.

Frequently asked questions about signing a contract

  • Can signing a contract always be canceled?

    Not always. The starting point of the legal world is that contracts must be fulfilled.
    You should examine the provisions of the contract and the cancellation conditions set forth therein. If the contract does not contain a provision that allows its cancellation, you should check whether there is any legal provision or ruling relevant to the type of contract you signed that allows its cancellation, in the circumstances relevant to you.

  • Should signing a contract always be done in the presence of the parties?

    לא. ניתן לחתום על חוזה גם לא בנוכחות הצדדים. דוגמה נפוצה היא ביצוע רכישה כלשהי דרך האינטרנט. הסכמה לרכוש את המוצר מהווה "חוזה" בו צד אחד מתחייב לרכוש את המוצר ולשלם את שוויו, והצד שכנגד מתחייב למכור את המוצר ולספק אותו בפועל ללקוח תוך פרק זמן מסוים.

  • Can a contract be cancelled within 14 days?

    Not always. You need to examine the type of transaction and how it was carried out. In these cases, it is worth reviewing the provisions of the Consumer Protection Law and the provisions of the Consumer Protection Regulations (Cancellation of a Transaction).

  • What do you do if you are required to sign a contract that only some of its clauses are unclear?

    If there is even one clause that is unclear to you, it is recommended not to sign a contract. Signing a contract that has even one clause that is unclear may lead to legal complications. Consult with your attorney first. lawyer Let him explain to you what the clause means and only then sign the contract.

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