We are having the same problem with our application and this bug prevent us from migrating to the current 5.2.x version.

A short rundown what happens:

query.setParameter(String name, Date value, TemporalType temporalType) calls after some steps setBindValue(T value, TemporalType clarifiedTemporalType) from QueryParameterBindingImpl.java

hibernate-core/src/main/java/org/hibernate/query/internal/QueryParameterBindingImpl.java

public void setBindValue(T value, TemporalType clarifiedTemporalType)
with
value = java.util.Date() object
clarifiedTemporalType = TemporalType.DATE

1. calls private void bindValue(T value)
2. sets this.bindType = org.hibernate.type.TimestampType
3. calls BindingTypeHelper.INSTANCE.determineTypeForTemporalType( clarifiedTemporalType, bindType, value )

hibernate-core/src/main/java/org/hibernate/query/internal/BindingTypeHelper.java

public BasicType determineTypeForTemporalType(TemporalType temporalType, Type baseType, Object bindValue)
with
temporalType = TemporalType.DATE
baseType = org.hibernate.type.TimestampType
bindValue = java.util.Date() object

1. sets javaType = java.util.Date.class
2. switch for temporalType jumps to case DATE
3. calls resolveDateTemporalTypeVariant( javaType, baseType )

public BasicType resolveDateTemporalTypeVariant(Class javaType, Type baseType)
with
javaType = java.util.Date.class
baseType = org.hibernate.type.TimestampType

lines 122-124 just return the baseType (org.hibernate.type.TimestampType) derived from the value, completely ignoring the temporalType (TemporalType.DATE)

Result (in our case): for a DATE column on the DB, the set date representation for the parameter causes an Exception because of the wrong format.