The Supreme Court analyses the differences between early maturity and termination due to default on mortgage loans

Judgment of the Civil Chamber of the Supreme Court No. 1335/2025, of 30 September 2025.

A property developer sued a financial institution, claiming that the early maturity and subsequent foreclosure proceedings initiated by the bank were inadmissible, on the grounds that the bank could not enforce the early maturity clause as it had previously failed to fulfil its own obligations to provide capital to finance a construction project.

The Supreme Court dismissed the appeal, clarifying the autonomy of early maturity clauses vis-à-vis the general regime for contract termination. The key points are:

• Early maturity is a lawful and autonomous agreement, distinct from the termination power conferred under Article 1124 of the Civil Code. Whilst the latter is based on the reciprocity of obligations, early maturity is governed primarily by the autonomy of will (Article 1255 of the Civil Code).
• The Supreme Court establishes that the borrower’s failure to pay instalments entitles the financial institution to request early termination, regardless of whether the bank has committed other breaches (such as capital delivery deadlines), provided that these do not substantially impede the fulfilment of the purpose of the contract.
• Whilst Article 1124 of the Civil Code requires a modulated analysis of the seriousness of the breach and the existence of a causal link, the early maturity clause operates automatically in accordance with the agreement, provided that its conditions (non-payment) are met.

The Supreme Court thus upheld the ruling of the Provincial Court of Barcelona, rejecting the claim that the financial institution’s declaration of early termination was improper or contrary to law.