(Bloomberg) -- Israel’s Supreme Court overturned a highly contested law aimed at weakening the justices’ own power in a loss to Prime Minister Benjamin Netanyahu’s right-wing coalition.

The court, sitting with all 15 justices for the first time ever, struck down by a vote of 8 to 7 a law passed by Parliament in July that would have barred judges from voiding government decisions as “unreasonable.”

“This is a historic day — a tremendous public victory for those who seek democracy,” the liberal Movement for Quality Government in Israel said in a statement. “A government and ministers who sought to exempt themselves from the rule of law have been told that there are judges in Jerusalem. That there is democracy. That there is a separation of powers.”

The closeness of the vote is an indication of the divisions within Israeli society over the court’s authority.

‘Unprecedented Harm’ 

The court held that “the amendment causes severe and unprecedented harm to the core characteristics of Israel as a democratic state.”  

The decision will be effective immediately, said Barak Medina, law professor at Hebrew University. Eight judges voted to overturn the law, seven to keep it.  

The law was approved as an amendment to a Basic Law and was the first in a number of judicial changes the government promised when it took office in late December 2022, a populist overhaul that split the nation, battered markets and drew criticism from the White House. Hundreds of thousands of people took to the streets to protest the planned changes or support them. 

The war ended those protests and shifted the nation’s attention to external threats. But the internal divisions are still there. 

Reasonableness is a broad — critics say blunt — instrument that the court has used to block cronyism, protect human rights and encourage what it says is rational decision-making. The court has other tools but this is seen as the most significant.

“The decision will block the attempt to carry out the judicial overhaul and is important to insure that the government acts according to public interest, and not just their own,” Professor Medina said.

The court also held, 12 to 3, that it has the authority “to carry out judicial review of Basic Laws, and to intervene in those rare and exceptional cases wherein the Knesset exceeds its constitutive authority,” the ruling, sent by the court, said. 

Likud Responds

The justices, two of whom will retire later this month, ruled as Israel’s nearly-three-month-old war with Hamas rages on. Netanyahu’s Likud party assailed the court, saying it threatened national consensus at a time of war. “The court’s decision is against the will of the people for unity, especially during wartime,” the party said. 

The rulings underline tensions that have long existed in Israeli society that stem from how a state that defines itself as Jewish manifests that identity and what its obligations are to non-Jews. While the nation’s political leadership has become more religious and nationalistic, the legal establishment has remained more liberal. The court’s protection of human and minority rights frustrates those on the right who think their votes should enable a shift in policy. 

The Israel Democracy Institute said in a statement that the court’s ruling was “precedent setting” and highlighted the need for the country to adopt a constitutional framework. 

“Now, more than ever, while our sons and daughters are on the front lines fighting for our country, it is critical that they know that Israeli democracy is strong and unassailable.”

Israel has no constitution and no law defining judicial reviews. It has a set of “basic laws” that, increasingly over the past three decades, the high court has relied upon to measure constitutionality. 

“Tonight the court ruled that there are unwritten principles, core values of democracy that limit the powers of the parliament,” said Medina.

(An earlier version of this article was corrected to fix a typo in the vote)

(Updates with IDI comment in paragraphs 14 and 15)

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