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Spain’s Supreme Court Orders Case-by-Case Review of IRPH Mortgages, Hands Banks Procedural Win

Trial judges will decide transparency for the average consumer using 2024 EU criteria that can still void clauses.

Overview

  • The Civil Chamber upheld Kutxabank’s cassation appeal, overturning a 2017 judgment tied to an IRPH mortgage.
  • A separate appeal brought by borrowers in Girona in 2021 was dismissed.
  • The court declined to set a single nationwide remedy and instructed judges to examine each contract based on the facts proved.
  • Lower courts must apply the “average consumer” transparency test informed by 2024 European Court of Justice guidance, which allows annulment in some cases.
  • The decisions are portrayed as a notable lift for banks, particularly Kutxabank, while leaving thousands of IRPH disputes to be resolved individually.