Ranking of creditors: mortgage vs. criminal seizure
Under Italian law, the ranking of creditors depends not only on contractual security arrangements but also, in certain circumstances, on statutory liens (privilegi) granted by law based solely on the nature of the underlying claim.
One such statutory lien arises whenever a seizure over real estate is ordered in the context of criminal proceedings (sequestro conservativo) for the purpose of securing damages and expenses (Section 316 of the Code of Criminal Procedure, “CCP”).
Where the real estate subject to the lien is already encumbered by a duly registered mortgage, it has long been debated whether the statutory lien takes priority over the mortgage, or vice versa.
With judgment No. 34681 of 29 December 2025, the Supreme Court held that the mortgage prevails.
