Scribd
Upload
121 views1 page

Luzon Lumber vs. Quiambao

1) The plaintiff lumber company provided building materials worth around 7,000 pesos to Manuel Quiambao and Virginia Santiago for the construction of two buildings on their mortgaged property. However, they failed to pay for the materials. 2) The issues are whether the plaintiff's credit enjoys preference over the mortgage credit of RFC, and whether providing lumber and materials for new construction qualifies as a refection credit. 3) The court held that the plaintiff's credit does not have preference, as it was not a new right established by the new civil code. It also held that refection credit primarily refers to repair or reconstruction, not entirely new works, so providing materials for new construction does not qualify.

Uploaded by

Francisca Paredes
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
121 views1 page

Luzon Lumber vs. Quiambao

1) The plaintiff lumber company provided building materials worth around 7,000 pesos to Manuel Quiambao and Virginia Santiago for the construction of two buildings on their mortgaged property. However, they failed to pay for the materials. 2) The issues are whether the plaintiff's credit enjoys preference over the mortgage credit of RFC, and whether providing lumber and materials for new construction qualifies as a refection credit. 3) The court held that the plaintiff's credit does not have preference, as it was not a new right established by the new civil code. It also held that refection credit primarily refers to repair or reconstruction, not entirely new works, so providing materials for new construction does not qualify.

Uploaded by

Francisca Paredes
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 1

179. LUZON LUMBER and HARDWARE COMPANY, INC vs.

MANUEL
QUIAMBAO, VIRGINIA SANTIAGO, AND REHABILITATION FINANCE
CORPORATION
G.R. No. L-5638 March 30, 1954

FACTS:
Manuel Quiambao and his wife Virginia Santiago, mortgaged their 3
lots in favor of the Rehabilitation Finance Corporation (RFC) to secure the
payment of a loan which sum was to be spent for the construction of two
buildings, — one for a hotel and the other for residence. The mortgage was
registered. Upon violation of the terms of the mortgage the RFC foreclosed
the same and in the auction sale, said RFC as highest bidder was awarded
the mortgaged properties. In the edification of the two buildings the spouses
bought on credit construction materials valued at about P7,000 from the
plaintiff Luzon Lumber & Hardware Co. Said building materials were
furnished by the lumber company, and again failed to pay the same. Hence,
petitioner filed instant petition.

ISSUES: 1) WON the plaintiff’s credit enjoyed preference over that of the
mortgage credit of the rfc under articles 2242 and 2253 of the new civil
code.
2) WON the furnishing oflumber and building materials by the plaintiff
for the construction of the two buildings of the spouses falls under refection
credit mentioned in paragraphs 3 and 5 article 1923.

HELD:
1. NO. The two articles in the new Civil Code above reproduced may
not be applied in the instant case for the reason that the credit of the
plaintiff is not a new right or one declared for the first time, a condition
required by Article 2253 of the new Civil Code for its enforcement and
application, because said right was already provided for by article 1923 of
the old Civil Code particularly paragraphs 3 and 5 which provides that:
“3. Mortgage and refection credits entered and recorded in the Registry of
Deeds, with respect to the property mortgaged, or which has been the
subject-matter of the refection;
5. Refection credits not entered or recorded, with respect to the real estate
upon which the refection was made, and only with respect to other credits
different from those mentioned in the four next preceding paragraphs.”
2) YES. Refectionary credit is primarily an indebtedness incurred in the
repair or reconstruction of something and does not ordinarily include an
entirely new work. It implies the idea of reconstruction or repair for reason of
destruction or deterioration.

You might also like