Short answer. Yes, but only over later creditors. Article 2242 of the Civil Code gives preferred status to credits annotated in the Registry of Property through judicial order by attachment or execution — but the preference is specifically limited to credits that arose after the annotation, not over earlier ones.
What the law says
Credits annotated in the Registry of Property, in virtue of a judicial order, by attachments or executions, upon the property affected, and only as to later credits
Civil Code, Article 2242 — Preferred Credits on Specific Immovables. Read the full provision →
How attachment annotation creates preference
Article 2242 lists the credits that enjoy preferred status over specific immovable property when a debtor is insolvent. Item 7 on that list covers credits annotated in the Registry of Property under a judicial order of attachment or execution. The annotation gives notice to the world that the property is encumbered, and that notice translates into priority: a creditor who annotates an attachment before others do gets to be paid first from the property. Annotation in the Registry is therefore the mechanism that converts a court order into an enforceable property preference.
The critical limitation: only as to later credits
The preference granted by an annotated attachment is limited. Article 2242 expressly states that the preference operates only as to later credits. This means your annotated attachment gives you priority over creditors who registered their claims or annotated their liens after your annotation — but it does not automatically override creditors who came before you. A registered mortgage annotated before your attachment, or taxes due on the land, will typically outrank your credit regardless of when you annotated.
The order of preference among competing creditors
Article 2242 ranks preferred creditors on the same immovable in the order they are listed. Taxes on the land or building come first. Then the unpaid purchase price of the property, laborers and contractors, material suppliers, and registered mortgage holders — all of these are ranked above a judicial attachment annotated later. The judicial attachment claim in item 7 comes after all of these. If you are competing with a registered mortgagee, the mortgage holder is generally ahead of you even if your attachment came first in time, because registered mortgages carry a higher statutory rank.
What to do to protect your annotated attachment
An attachment annotation in the Registry is a meaningful legal tool, but its value depends entirely on your position in the creditor queue. If there are existing mortgages or other higher-ranked encumbrances on the property, the value of the property after paying those superior claims may leave little or nothing for you. Before relying heavily on an annotated attachment, check the Registry of Property for all existing liens and encumbrances on the land. A lawyer can help you assess the realistic collection prospects and advise on whether pursuing execution on this property or exploring other assets is the better strategy.
Cases citing this provision
These Supreme Court decisions cite the provision above. We list them so you can read them yourself; the summaries of what each decided are not ours to give.
- Atlantic Erectors, Inc. vs. Herbal Cove Realty Corporation, G.R. No. 148568, March 20, 2003 — read the decision on LawPhil →
- Jan-Dec Construction Corporation vs. Court of Appeals, et al, G.R. No. 146818, February 6, 2006 — read the decision on LawPhil →
- J.L. Bernardo Construction, et al. vs. Court of Appeals, et al, G.R. No. 105827, January 31, 2000 — read the decision on LawPhil →
- Strategic Alliance Development Corporation vs. Radstock Securities Limited and Philippine National Construction corporation, G.R. No. 178158 / G.R. No. 180428, December 4, 2009 — read the decision on LawPhil →