Unilaterally Setting a Closing Date Can Be Costly: The Italian Supreme Court’s View on Breach of Contract

In the world of real estate transactions, honoring contractual agreements is not optional—it’s essential. Anyone who believes they can summon the other party to the closing without even agreeing on a date is taking a serious risk. This was made clear by Italy’s Supreme Court in a significant ruling (no. 9399/2025), which offers important guidance for all professionals involved in property sales.

The Context: A Deal That Never Closed and a One-Sided Invitation

In the case under review, a buyer who had signed a preliminary agreement to purchase multiple properties brought legal action to compel the transfer of ownership and to seek a price reduction. The seller, in turn, sought termination of the contract, citing the buyer’s alleged breach.

However, the conduct attributed to the seller—deemed decisive by the Court of Appeal—involved summoning the buyer to finalize the sale without first agreeing on a date. This act was considered contrary to both contractual good faith and the terms of the preliminary agreement.

But How Much Does Breach Really Matter?

The Supreme Court overturned the decision. It clarified that merely identifying improper behavior—such as unilaterally setting a closing date—is not enough to justify termination. What’s required is an assessment of how seriously the breach affected the contractual balance.

According to Article 1455 of the Italian Civil Code, termination is allowed only when the breach is not of minor importance, assessed in light of the other party’s interests. This evaluation must be specific and reasoned—the judge cannot rely on assumptions or generic statements. They must explain why the breach is considered serious, also taking into account any shared responsibilities or broader conduct by the parties involved.

A Clear Principle for Contract Drafters and Managers

This ruling reaffirms a core principle for anyone drafting or managing contracts: performance must be evaluated not only formally, but also substantively, considering whether the contractual interest was genuinely impaired.

In Summary

Unilaterally summoning a party to the closing without agreeing on a date may be improper, but it is not automatically grounds for terminating the contract. It becomes so only if it significantly disrupts the contractual balance and undermines the deal’s economic purpose.

Conclusion

For lawyers, notaries, real estate agents, and industry professionals, this decision serves as both a warning and a compass: in reciprocal obligation contracts, assessing breach of contract requires solid legal and factual grounding.

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