The controversy sparked by the sale of three buildings in Jerusalem, owned by the Greek Orthodox Church Patriarchate, to a Jewish group intensified on Thursday.

A Jerusalem District Court judge granted the Patriarchate's request to vacate the ruling that the three properties, strategically located in East Jerusalem, had been legally sold to Ateret Cohanim – a Jewish organization which seeks to increase Jewish presence in the Old City.

Judge Tamar Bar-Asher ordered that the case be reheard, but her ruling was not made on the merits of the case. Instead it was made by default after three foreign shell companies affiliated with Ateret Cohanim failed to file a response to the church’s motion by the required deadline. Bar-Asher also ordered the companies to pay the Patriarchate 50,000 shekels ($14,400) in legal expenses and court costs.

The law office of Zeev Scharf, which represents the companies affiliated with Ateret Cohanim, said in response that the latest court ruling was the product of “an underhanded move by the Patriarchate” that took advantage of major health problems that the lawyer for the companies affiliated with Ateret Cohanim is facing. “The Patriarchate and its lawyer were aware of the circumstances but chose to ignore them and even conceal them from the court.”

The statement from the law firm expressed confidence that Thursday’s ruling would be reversed.

The contested sale 14 years ago included two large hotels, the New Imperial and the Petra, which overlook the Jaffa Gate. A third building that was sold is located in the Christian Quarter. The sale caused an uproar in Jerusalem’s Greek Orthodox Patriarchate and led to the unprecedented ouster of the patriarch at the time, Irenaeus I.

A year and a half ago, after a long legal battle, Jerusalem District Court Judge Gila Canfy Steinitz ruled that, although she had found problems with the sale of the property, the church had not proven that the transactions were the product of bribery or corruption and the sale was valid.

In June, on appeal by the Patriarchate, the ruling was confirmed by the Israeli Supreme Court. That paved the way for Ateret Cohanim to ultimately take over the buildings and evict their residents in the future.

The Supreme Court’s decision prompted additional uproar in the Christian world and a joint protest by Jerusalem church leaders from a large number of denominations. Christian and Palestinian groups have claimed that allowing Jews to move into the buildings would change the character of the Christian Quarter and the Jaffa Gate plaza in the Old City.

Newly discovered evidence?

In August, the Patriarchate filed a motion to vacate Canfy Steinitz’s ruling, based on newly discovered evidence provided to the Greek Orthodox Patriarchate by Ted Bloomfield, who in the 1990s managed two Jerusalem hotels including the Petra Hotel. He purportedly said that he had accepted money from Ateret Cohanim to persuade Palestinian protected tenants at the Petra to sell their rights to the Jewish non-profit organization.

In its motion, the church claims that Bloomfield’s testimony reflects actions on Ateret Cohanim’s part that are “extraordinary in their severity” and include fraud, forgery of documents presented in court and bribery, including alleged attempted sexual bribery.

The church also alleges that Ateret Cohanim obstructed justice through perjury and the concealment of documents. Most of the assertions have been reported in recent years by Haaretz.

Sources with knowledge of the case said it is too early to ascertain the impact of the latest ruling, but said it could delay Ateret Cohanim’s plans to take control of the buildings and evict its current tenants.