I supplied all the cement and steel for a building project and was never paid — do I have a preferred claim on that building against the owner's other creditors?

Your claim as a material supplier is expressly listed

Article 2242 is not a general rule about all debts — it lists specific claims that become preferred against a specific piece of immovable property. Your situation falls squarely within it: the article preferrs "claims of furnishers of materials used in the construction, reconstruction, or repair of buildings, canals or other works, upon said buildings, canals or other works." Supplying cement and steel that were actually used in building the structure places your unpaid claim in this category, attached specifically to that building.

The preference attaches to the property itself

This is not simply a right to be paid before other creditors out of the owner's general assets. The opening clause of the article makes clear that these preferred claims "shall constitute an encumbrance on the immovable or real right" in question. That means your claim is tied to the building where your materials were used, giving you a specific interest in that property rather than an unsecured claim against the owner generally.

You are not necessarily first in line

Article 2242 lists ten categories of preferred claims on the same immovable, including unpaid land or building taxes, the unpaid price of the property itself, claims of laborers and contractors who worked on the construction, and recorded mortgage credits, among others. Your claim as a material supplier ranks alongside — not automatically above — these other listed preferences. Where several preferred creditors compete over the same building, their relative priority among each other depends on rules beyond simply being named in this article, so being listed here secures a preference, not necessarily first place.

What this means if the owner has other debts

If the owner of the building you supplied is now facing claims from multiple creditors, your status as a preferred creditor under Article 2242 gives you a real advantage over ordinary, unsecured creditors who have no claim on that specific property at all. But because the article groups you together with laborers, contractors, tax authorities, and mortgagees who may also have preferred claims on the same building, establishing exactly how much of the property's value is available to satisfy your claim after those other preferences are honored is a fact-specific exercise that depends on the full picture of who else is owed what.

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 →

Related provisions

• Civil Code, Article 2242 — Preferred Credits on Specific Immovables