All the enemies are dead except the boss who says he surrenders, what do you do?

[Arkhios]

I abhor the idea of purposefully mocking the group's paladin just because the rules say paladins must act in a certain way. It's that player's choice to play a paladin, just as much it's other players' choice to play some other class. Individual choices do not justify being an ass towards the paladin or their player, nor vice versa. Learn to adapt to your circumstances.

That said, what to do to a surrendering BBEG would largely depend on their nature. Even if you are the paladin. And even then, killing is not the only solution to achieve your goals and meet your Code.