Lopez vs.

Orosa; Property
8/15/2013
0 Comments
G.R.

Nos.

L-10817-18

February

28,

1958

Facts: Petitioner Lopes was doing business under

the
name
Castelo
Sawmill
.
The case started when respondent Orosa invited
petitioner to join his venture of putting up a
corporation which will be named as Plaza Theater
Corporation. Petitioner declined the offer but he
offered to produce with pay, lumbers which will be
needed
in
construction
of
the
theater.
Despite demands of payment from petitioner,
respondents defaulted in their obligation and to calm
the former's feeling they promised to obtain a loan
inorder to pay their obligation to petitioner.
However, unknown to petitioner, respondent had
already obtained a loan and made Luzon Surety
Company as surety. The lot where the theater stands
was
used
as
a
security.
Petitioner remained unpaid, thus he file a case
against
respondents
and
Plaza
Theater
Inc. Moreover, petitioner cause the annotation of lis
pendens on the lot and the bulinding of respondent
corporation.

The surety company, in the meantime, upon

discovery that the land was already registered under
the Torrens System and that there was a notice of lis
pendensthereon, filed a petition for review of the
decree of the land registration court in order to
annotate the rights and interests of the surety
company over said properties . Opposition thereto
was offered by petitioner Lopez, asserting that the
amount demanded by him constituted a preferred
lien over the properties of the obligors; that the
surety company was guilty of negligence when it
failed to present an opposition to the application for
registration of the property; and that if any violation
of the rights and interest of said surety would ever
be made, same must be subject to the lien in his
favor.
The RTC ruled that the lien of petitioner extends only
to
the
building.
however,
on
appeal
petitioner contends that the lien created in favor of
the furnisher of the materials used for the
construction, repair or refection of a building, is also
extended to the land which the construction was
made, and in support thereof he relies on Article
1923 of the Spanish Civil Code, pertinent law on the
matter,
which
reads
as
follows:
ART. 1923. With respect to determinate real property
and real rights of the debtor, the following are
preferred:

5. Credits for refection, not entered or recorded, with

respect to the estate upon which the refection was
made, and only with respect to other credits
different from those mentioned in four preceding
paragraphs. The CA affirmed the court a qou.
Issue: Whether the lien of petitioner extends not
only to the building but also to the respondent's lot.
Held: No
In affirming the decisions of the courts a quo,
explained the SC- "we cannot subscribe to this view,
for while it is true that generally, real estate
connotes the land and the building constructed
thereon, it is obvious that the inclusion of the
building, separate and distinct from the land, in the
enumeration of what may constitute real properties
could mean only one thing that a building is by
itself an immovable property, a doctrine already
pronounced by this Court in the case ofLeung Yee
vs. Strong Machinery Co., 37 Phil., 644. Moreover,
and in view of the absence of any specific provision
of law to the contrary, a building is an immovable
property, irrespective of whether or not said
structure and the land on which it is adhered to
belong
to
the
same
owner.
A close examination of the provision of the Civil

Code [Art. 1923] invoked by appellant [Lopez]

reveals that the law gives preference to unregistered
refectionary credits only with respect to the real
estate upon which the refection or work was made.
This being so, the inevitable conclusion must be that
the lien so created attaches merely to the
immovable property for the construction or repair of
which the obligation was incurred. Evidently,
therefore, the lien in favor of appellant for the
unpaid value of the lumber used in the construction
of the building attaches only to said structure and to
no
other
property
of
the
obligors.
Considering the conclusion thus arrived at, i.e., that
the materialman's lien could be charged only to the
building for which the credit was made or which
received the benefit of refection, the lower court was
right in, holding at the interest of the mortgagee
over the land is superior and cannot be made
subject to the said materialman's lien.