diff --git a/dtc-parser.y b/dtc-parser.y
index b2fd4d1..ca3f500 100644
--- a/dtc-parser.y
+++ b/dtc-parser.y
@@ -171,10 +171,10 @@ devicetree:
 		{
 			struct node *target = get_node_by_ref($1, $3);
 
-			add_label(&target->labels, $2);
-			if (target)
+			if (target) {
+				add_label(&target->labels, $2);
 				merge_nodes(target, $4);
-			else
+			} else
 				ERROR(&@3, "Label or path %s not found", $3);
 			$$ = $1;
 		}
diff --git a/tests/run_tests.sh b/tests/run_tests.sh
index 157dbae..ed489db 100755
--- a/tests/run_tests.sh
+++ b/tests/run_tests.sh
@@ -511,6 +511,7 @@ dtc_tests () {
     run_test dtbs_equal_ordered multilabel.test.dtb multilabel_merge.test.dtb
     run_dtc_test -I dts -O dtb -o dtc_tree1_merge_path.test.dtb test_tree1_merge_path.dts
     tree1_tests dtc_tree1_merge_path.test.dtb test_tree1.dtb
+    run_wrap_error_test $DTC -I dts -O dtb -o /dev/null test_label_ref.dts
 
     # Check prop/node delete functionality
     run_dtc_test -I dts -O dtb -o dtc_tree1_delete.test.dtb test_tree1_delete.dts
diff --git a/tests/test_label_ref.dts b/tests/test_label_ref.dts
new file mode 100644
index 0000000..7009c79
--- /dev/null
+++ b/tests/test_label_ref.dts
@@ -0,0 +1,9 @@
+/dts-v1/;
+
+/ {
+
+};
+
+label: &handle {
+
+};