Real Estate Forfeiture Clause Moderation

A lower court judgment was appealed regarding a dispute over an obligation arising from a real estate transaction where a contractual clause stipulated forfeiture of payments upon non-performance by the purchaser. The highest court upheld the lower court's decision, reasoning that while the clause stipulated forfeiture, the lower court correctly applied the principle that a penalty clause must be evaluated by the judge, who retains the power to moderate or suppress it, even ex officio, if the stipulated penalty is manifestly excessive in relation to the prejudice suffered, thus justifying the refusal to enforce the automatic forfeiture provided for in the contract.