Lopez v.

Orosa
G.R. Nos. L-10817-18, 103 SCRA 98

DOCTRINE: 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 in the enumeration of what may constitute real properties could only mean one thing—that a
building is by itself an immovable property

FACTS:
Lopez was engaged in business under the name Lopez-Castelo Sawmill. Orosa, who lived in the same province as Lopez, one day
approached Lopez and invited the latter to make an investment in the theatre business. Orosa, his family and close friends
apparently were forming a corporation named Plaza Theatre. Lopez expressed his unwillingness to invest. Nonetheless, there
was an oral agreement between Lopez and Orosa that Lopez would be supplying the lumber for the construction of the theatre.
The terms were the following: one, Orosa would be personally liable for any account that the said construction would incur;
two, payment would be by demand and not by cash on delivery.

Pursuant to the agreement, Lopez delivered the lumber for the construction. Lopez was only paid one-third of the total cost.
The land on which the building has been erected was previously owned by Orosa, which was later on purchased by the
corporation. Due to the incessant demands of Lopez, the corporation mortgaged its properties. On an earlier relevant date, the
corporation obtained a loan with Luzon Surety Company as surety and in turn, the corporation executed a mortgage over the
land and building. In the registration of the land under Act 496, such mortgage wasn’t revealed. Also due to the demands of
Lopez, Orosa issued a deed of assignment over his shares of stock in the corporation. As there was still an unpaid balance,
Lopez filed a case against Orosa and Plaza theatre. He asked that Orosa and Plaza theatre be held liable solidarily for the unpaid
balance; and in case defendants failed to pay, the land and building should be sold in public auction with the proceeds to be
applied to the balance; or that the shares of stock be sold in public auction. Lopez also had lis pendens be annotated in the OCT.
The trial court decided that there was joint liability between defendants and that the material man’s lien was only confined to
the building.

ISSUE:
W/N the material men’s lien for the value of the materials used in the construction of the building attaches to said structure
alone and doesn’t extend to the land on which the building is adhered to?

HELD:
The contention that the lien executed in favor of the furnisher of materials used for the construction and repair of a building is
also extended to land on which the building was constructed is without merit. 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 in the enumeration of
what may constitute real properties could only mean one thing—that a building is by itself an immovable property. Moreover,
in the absence of any specific provision 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.
Appellant invoked Article 1923 of the Spanish Civil Code, which provides—“With respect to determinate real property and real
rights of the debtor, the following are preferred: xxx Credits for reflection, not entered or recorded, and only with respect to
other credits different from those mentioned in four next preceding paragraphs.” Close examination of the abovementioned
provision reveals that the law gives preference to unregistered refectionary credits only with respect to the real estate upon
which the refectionary 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. 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.