MODULE 7 Whether the contracts of transportation between Purita
and Carmina Mapa, on the one hand, and TWA, on the
Aviation Law
Definition of Intl Carriage or Intl’ Transportation
Mapa, et al. v. CA, et al.,
G.R. No.122308 | Date: July 8,1997
Facts:
Plaintiffs Mapa entered into contract of air transportation
with defendant TWA. On August 10, 1990, plaintiffs
Carmina and Purita left Manila on board PAL flight No. 104
for Los Angeles. Upon arriving in Boston, plaintiffs Purita
and Carmina proceeded to the carousel to claim their
baggages and found only three out of the seven they
checked in.
After unfruitful searches, TWA offered to amicably settle
the case by giving plaintiffs-appellants two options: (a)
transportation credit for future TWA travel or (b) cash
settlement. Five months lapsed without any result on
TWA's intensive search. The plaintiffs chose the first option
but this was disregarded by TWA and they paid them the
partial amount.
Despite demands by plaintiffs, TWA failed and refused
without just cause to indemnify and redress plaintiffs for
the grave injury and damages they have suffered.
Petitioner’s Argument/s:
Petitioners argued that the court has jurisdiction over the
case and that the Warsaw Convention is inapplicable
because the subject matter of the case is not included
within the coverage of the said convention.
Respondent’s Arguments:
Respondents argued that the Philippine Courts lacks
jurisdiction over the action for damages pursuant to Article
28(1) of the Warsaw Convention, the action could only be
brought either in Bangkok where the contract was entered
into, or in Boston which was the place of destination, or in
Kansas City which is the carrier's domicile and principal
place of business.
Ruling of the lower court:
The appellate court disagreed with the petitioners and
affirmed the order of the trial court. It held that the
Warsaw Convention is the law which governs the dispute
between the petitioners and TWA because what is involved
is international transportation defined by said Convention
in Article I(2). This holding is founded on its determination
that the two TWA tickets for Los Angeles-New York-
Boston-St. Louis-Chicago purchased in Bangkok, Thailand,
were issued in conjunction with, and therefore formed part
of, the contract of transportation performed from Manila,
Philippines, to the United States.
Issue:
TRANSPORTATION LAWS | ATTY. CAPANAS | MODULE 7 CASE DIGEST COMPILATION | EH405 2020-2021 | PAGE | 1
other, were contracts of "international transportation"
under the Warsaw Convention.
Rule:
Article I (2) of the Warsaw Convention:
a contract is one of international transportation only if
according to the contract made by the parties, the place of
departure and the place of destination, whether or not
there be a break in the transportation or a transshipment,
are situated either within the territories of two High
Contracting Parties, or within the territory of a single High
Contracting Party, if there is an agreed stopping place
within a territory subject to the sovereignty, mandate or
authority of another power, even though that power is not
a party to this convention.
There are then two categories of international
transportation, viz., (1) that where the place of departure
and the place of destination are situated within the
territories of two High Contracting Parties regardless of
whether or not there be a break in the transportation or a
transshipment; and (2) that where the place of departure
and the place of destination are within the territory of a
single High Contracting Party if there is an agreed stopping
place within a territory subject to the sovereignty,
mandate, or authority of another power, even though the
power is not a party of the Convention.
Application:
No. The contracts of transportation in this case are
evidenced by the two TWA tickets, No. 015:9475:153:304
and No. 015:9475:153:305, both purchased and issued in
Bangkok, Thailand. On the basis alone of the provisions
therein, it is obvious that the place of departure and the
place of destination are all in the territory of the United
States, or of a single High Contracting Party. The
contracts, therefore, cannot come within the purview of
the first category of international transportation. Neither
can it be under the second category since there was NO
agreed stopping place within a territory subject to the
sovereignty, mandate, or authority of another power.
The only way to bring the contracts between Purita and
Carmina Mapa, on the one hand, and TWA, on the other,
within the first category of "international transportation" is
to link them with, or to make them an integral part of, the
Manila-Los Angeles travel of Purita and Carmina through
PAL aircraft.
Notice of Liability; Contract of adhesion
Pan American World Airways, Inc. v. Rapadas
G.R. NO. 60673 | MAY 19, 1992
FACTS:
Rapadas was to take a flight with PanAm from Guam to
Manila. While standing in line to board the flight at the
Guam airport. Rapadas was ordered by PanAm’s hand-
carry control agent to check-in his Samsonite attache
case. Rapadas protested pointing to the fact that other
co-passengers were permitted to handcarry bulkier
baggages and tried to get around but for fear that he
would miss the plane if he insisted and argued on
personally taking the valise with him, he acceded to
checking it in. He then gave his attache case to his
brother who happened to be around and who checked it
in for him, but without declaring its contents or the value
of its contents. He was given a Baggage Claim Tag P-749-
713.
Upon arriving in Manila on the same date, Rapadas
claimed he was given all his checked-in baggages except
the attache case.
PanAm exerted efforts to locate the luggage through the
Pan American World Airways-Manila International Airport
(PAN AM-MIA) Baggage Service. On 30 January 1975,
PanAm required the Rapadas to put the request in
writing. Rapadas filled in a Baggage Claim Blank Form.
But the company did not respond even after multiple
multiple calls and demands by Rapadas.
Rapadas received a letter from PanAm’s counsel dated 2
August 1975 offering to settle the claim for the sum of
$160.00 representing
Refusing to accept this kind of settlement, Rapadas filed
the instant action for damages on 1 October 1975.
PETITIONERS CONTENTION ( WON)
Rapadas alleged that PanAm discriminated or singled him
out in ordering that his luggage be checked in.
He also alleged that PanAm neglected its duty in the
handling and safekeeping of his attache case from the
point of embarkation in Guam to his destination in Manila.
He placed the value of the lost attache case and its
contents at US$42,403.90.
RESPONDENTS CONTENTION (LOSS)
PAN AM acknowledged responsibility for the loss of the
attache case but asserted that the claim was subject to
the "Notice of Baggage Liability Limitations" allegedly
attached to and forming part of the passenger ticket
RULING OF THE LOWER COURTS:
The lower court ruled in favor of complainant Rapadas
after finding no stipulation giving notice to the baggage
liability limitation and ordered PanAm to pay Rapadas by
way of actual damages the equivalent peso value of the
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amount of $5,228.90 and 100 paengs (Tongan money),
nominal damages in the amount of P20,000.00 and
attorney’s fees of
P5,000.00, and the costs of the suit. The trial court also
dismissed PanAm’s counterclaim. On appeal, the Court of
Appealsv affirmed the trial court decision.
Hence, the petition for review. The Supreme Court
granted the petition, and reversed and set aside the
decision of the Court of Appeals.
ISSUE :
What is the extent of PanAm’s liability to Rapadas, if any?
Was there sufficient notice of liability found in the airline
ticket?
What are contracts of adhesion?
RULE :
The Warsaw Convention, as amended, specifically provides
that it is applicable to international carriage which it
defines in Article 1, par. 2 as follows: "(2) For the purposes
of this Convention, the expression 'international carriage'
means any carriage in which, according to the agreement
between the parties, the place of departure and the place
of destination, whether or not there be a breach in the
carriage or a transhipment, are situated either within the
territories of two High Contracting Parties or within the
territory of a single High Contracting Party if there is an
agreed stopping place within the territory of another State,
even if that State is not a High Contracting Party. Carriage
between two points within the territory of a single High
Contracting Party without an agreed stopping place within
the territory of another State is not international carriage
for the purposes of this Convention." ("High Contracting
Party" refers to a state which has ratified or adhered to the
Convention, or which has not effectively denounced the
Convention [Article 40A(1)]).
Pan American World Airways v. Intermediate Appellate
Court (164 SCRA 268 [1988]) that: "It (plane ticket) is
what is known as a contract of 'adhesion', in regards which
it has been said that contracts of adhesion wherein one
party imposes a ready made form of contract on the other,
as the plane ticket in the case at bar, are contracts not
entirely prohibited. The one who adheres to the contract is
in reality free to reject it entirely; if he adheres, he gives
his consent
APPLICATION:
Since PANAM lost the luggage of Rapadas They have to
pay him form the loss. The petitioner is ordered to pay
the private respondent damages in the amount of
US$400.00 or its equivalent in Philippine Currency at the
time of actual payment, P10,000.00 in attorney's fees,
and costs of the suit
Herein, there was such a Notice appearing on page two
(2) of the airline ticket stating that the Warsaw
 Convention governs in case of death or injury to a
passenger or of loss, damage or destruction to a
passenger’s luggage. The Notice states that “If the
passenger’s journey involves an ultimate destination or
stop in a country other than the country of departure the
Warsaw Convention may be applicable and the
Convention governs and in most cases limits the liability
of carriers for death or personal injury and in respect of
loss of or damage to baggage. Furthermore, paragraph 2
of the “Conditions of Contracts” also appearing on page 2
of the ticket states that “(2) Carriage hereunder is subject
to the rules and limitations relating to liability established
by the Warsaw Convention unless such carriage is not
‘international carriage’ as defined by that Convention.”
Carriage to be performed by successive carriers
KLM Royal Dutch Airlines v. The Honorable Court of
Appeals,
G.R. No. | Date
Facts:
Spouses Mendoza approached Mr. Reyes, the branch
manager of Philippine Travel Bureau, for consultation
about a world tour which they were intending to make with
their daughter and niece. Three segments of the trip, the
longest, was via KLM. Respondents decided that one of the
routes they will take was a Barcelona-Lourdes route with
knowledge that only one airline, Aer Lingus, served it.
Reyes made the necessary reservations. To this, KLM
secured seat reservations for the Mendoza’s and their
companions from the carriers which would ferry them
throughout their trip, which the exception of Aer Lingus.
When the Mendoza’s left the Philippines, they were issued
KLM tickets for the entire trip. However, their coupon for
Aer Lingus was marked “on request”.
When they were in Germany, they went to the KLM office
and obtained a confirmation from Aer Lingus. At the airport
in Barcelona, the Mendozas and their companions checked
in for their flight to Lourdes. However, although their
daughter and niece were allowed to take the flight, the
spouses Mendozas were off loaded on orders of the Aer
Lingus manager, who brusquely shoved them aside and
shouted at them. So the spouses Mendozas took a train
ride to Lourdes instead.
Petitioner’s Argument/s:
KLM should not be held accountable for the tortious
conduct of Aer Lingus because of the provision printed on
the respondents' tickets expressly limiting the KLM's
liability for damages only to occurrences on its own line.
(LOST)
Respondent’s Arguments:
Thus, they filed a complaint with the Court of First
Instance of Manila for damages against KLM for breach of
contract of carriage. , and for the humiliating treatment
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received by them at the hands of the Aer Lingus manager
in Barcelona.(WON)
Ruling of the lower court:
The trial court decided in favor of the Mendozas. On
appeal, the CA affirmed the decision. Hence, KLM brings
this petition to the Supreme Court. KLM cites Art 30 of the
Warsaw Convention, which states: the passenger or his
representatives can take action only against the carrier
who performed the transportation during which the
accident or delay occurred. Also, KLM avers that the front
cover of each ticket reads: that liability of the carrier for
damages shall be limited to occurrences on its own line.
Issue:
WON KLM should be held liable for damage? (YES)
Rule:
ART. 30 of the Warsaw Convention:
(1) In the case of transportation to be performed by
various successive carriers and failing
within the definition set out in the third paragraph of
Article I, each carrier who accepts
passengers, baggage, or goods shall be subject to the
rules set out in the convention,
and shall be deemed to be one of the contracting parties
to the contract of
transportation insofar as the contract deals with that part
of transportation which is
performed under his supervision.
(2) In the case of transportation of this nature, the
passenger or his representative can take action only
against the carrier who performed the transportation
during which the
accident or the delay occured, save in the case where, by
express agreement, the first carrier has assumed liability
for the whole journey.
As maintained by the respondents and the Court of
Appeals, the passage tickets of the respondents provide
that the carriage to be performed thereunder by several
successive carriers "is to be regarded as a single
operation," which is diametrically incompatible with the
theory of the KLM that the respondents entered into a
series of independent contracts with the carriers which
took them on the various segments of their trip. This
position of KLM we reject. The respondents dealt
exclusively with the KLM which issued them tickets for
their entire trip and which in effect guaranteed to them
that they would have sure space in Aer Lingus flight 861.
The respondents, under that assurance of the
internationally prestigious KLM, naturally had the right to
expect that their tickets would be honored by Aer Lingus
to which, in the legal sense, the KLM had indorsed and in
effect guaranteed the performance of its principal
engagement to carry out the respondents' scheduled
itinerary previously and mutually agreed upon between
the parties
Application:
The argument that the KLM should not be held accountable
for the tortious conduct of Aer Lingus because of the
provision printed on the respondents' tickets expressly
limiting the KLM's liability for damages only to occurrences
on its own lines is unacceptable. As noted by the Court of
Appeals that condition was printed in letters so small that
one would have to use a magnifying glass to read the
words.
Under the circumstances, it would be unfair and
inequitable to charge the respondents with automatic
knowledge or notice of the said condition so as to preclude
any doubt that it was fairly and freely agreed upon by the
respondents when they accepted the passage tickets
issued to them by the KLM.
Lufthansa German Airlines v. Court of Appeals
G.R. No. 83612 | November 24, 1994
FACTS:
Tirso V. Antiporda, Sr. was, contracted by Sycip, Gorres,
Velayo & Co. (SGV) to be the institutional financial
specialist for the agricultural credit institution project of
the Investment and Development Bank of Malawi in Africa.
For the engagement, Antiporda would be provided one
round-trip economy ticket from Manila to Blantyre and
back with a maximum travel time of four days per round-
trip. On September 17, 1984, Lufthansa, through SGV,
issued the ticket for Antiporda's confirmed flights to
Malawi, Africa. The ticket particularized his itinerary:
Manila-Bombay-Nairobi-Lilongwe- Blantyre.
Thus, on September 25, 1984, Antiporda took the
Lufthansa flight to Singapore from where he proceeded to
Bombay on board the same airline. He arrived in Bombay
as scheduled and waited at the transit area of the airport
for his connecting flight to Nairobi which was, per schedule
given him by Lufthansa, to leave Bombay. Lufthansa,
informed Antiporda that his seat in Air Kenya Flight 203 to
Nairobi had been given to a very important person of
Bombay who was attending a religious function in Nairobi.
Antiporda protested but Air Kenya Flight 203 left for
Nairobi without him on board. Stranded in Bombay,
Antiporda was booked for Nairobi via Addis Ababa only on
September 27, 1984. He finally arrived in Blantyre at 9:00
o'clock in the evening of September 28, 1984, more than
a couple of days late for his appointment with people from
the institution he was to work with in Malawi.
Consequently, Antiporda's counsel wrote the general
manager of Lufthansa in Manila demanding P1,000,000 in
damages for the airline's "malicious, wanton, disregard of
the contract of carriage." Apparently getting no positive
action from Lufthansa, on January 21, 1985, Antiporda
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filed with the RTC of Quezon City a complaint against
Lufthansa.
Petitioner’s Contention: (LOST)
Lufthansa argued that it cannot be held liable for the acts
committed by Air Kenya on the basis of the following: (a)
it merely acted as a ticket-issuing agent in behalf of Air
Kenya; consequently the contract of carriage entered into
is between respondent Antiporda and Air Kenya, to the
exclusion of petitioner Lufthansa; (b) under sections (1)
and (2) Article 30 of the Warsaw Convention, an airline
carrier is liable only to untoward occurrences on its own
line; (c) the award of moral and exemplary damages in
addition to attorney's fees by the trial court is without basis
in fact and in law.
Respondent’s Contention:
Antiporda insists that he entered with Lufthansa an
exclusive contract of carriage, the nature of which is a
continuous carriage by air from Manila to Blantyre Malawi;
that it did not enter into a series of independent contracts
with the carriers that transported him for the remaining
leg of his trip.
ISSUE: whether or not petitioner should be held liable for
damages occasioned by the "bumping-off" of private
respondent by one of the airlines contracted to carry him
to a particular destination of the five-leg trip. YES
RULE:
This case is one of a contract of carriage. And the ticket
issued by the defendant to the plaintiff is the written
agreement between the parties herein. From the ticket,
therefore, it is indubitably clear that it was the duty and
responsibility of the defendant Lufthansa to transport the
plaintiff from Manila to Blantyre, on a trip of five legs.
SC rejected Lufthansa's theory that from the time another
carrier was engaged to transport Antiporda on another
segment of his trip, it merely acted as a ticket-issuing
agent in behalf of said carrier. Although the contract of
carriage was to be performed by several air carriers, the
same is to be treated as a single operation conducted by
Lufthansa because Antiporda dealt exclusively with it
which issued him a Lufthansa ticket for the entire trip. By
issuing a confirmed ticket, Lufthansa in effect guaranteed
Antiporda a sure seat with Air Kenya. Private respondent
Antiporda, maintained the Court of Appeals, had the right
to expect that his ticket would be honored by Air Kenya
which, in the legal sense, Lufthansa had endorsed and, in
effect, guaranteed the performance of its principal
engagement to carry out his five-leg trip. Lufthansa cannot
claim that its liability thereon ceased at Bombay Airport
and thence, shifted to the various carriers that assumed
the actual task of transporting said private respondent.
The appellate court also ruled that Lufthansa cannot rely
on Sections (1) and (2), Article 30 of the Warsaw
Convention because the provisions thereof are not
applicable under the circumstances of the case. Sections
(1) and (2), Article 30 of the Warsaw Convention provide:
(1) In the case of transportation to be performed by
various successive carriers and falling within the definition
set out in the third paragraph of Article I, each carrier who
accepts passengers, baggage, or goods shall be subject to
the rules set out in the convention, and shall be deemed
to be one of the contracting parties to the contract of
transportation insofar as the contract deals with that part
of the transportation which is performed under his
supervision. (2) In the case of transportation of this
nature, the passenger or his representative can take action
only against the carrier who performed the transportation
during which the accident or the delay occurred, save in
the case where, by express agreement, the first carrier has
assumed liability for the whole journey.
Antiporda's cause of action is not premised on the
occurrence of an accident or delay as contemplated under
Section 2 of said Article but on Air Kenya's refusal to
transport him in order to accommodate another. The
provision does not contemplate the instance of "bumping-
off" but merely of simple delay,it cannot provide a handy
excuse for Lufthansa as to exculpate it from any liability to
Antiporda.
In justifying its award of moral and exemplary damages,
the lower court emphasized that the breach of contract
was "aggravated by the discourteous and highly arbitrary
conduct of an official of petitioner Lufthansa in Bombay."
. . . . Bumped off from his connecting flight to Nairobi and
stranded in the Bombay Airport for 32 hours, not even
Lufthansa office in Bombay, after learning plaintiff's being
stranded in Bombay and his accommodation problem,
provided any relief to plaintiff's sordid situation. It was a
pathetic sight that he, tasked to perform consultancy work
in a World Bank found himself stranded in a foreign land
where nobody was expected to help him in his predicament
except the defendant, who displayed utter lack of concern
of its obligation to the plaintiff and left plaintiff alone in his
misery at the Bombay airport.
APPLICATION: Although the contract of carriage was to
be performed by several air carriers, the same is to be
treated as a single operation conducted by Lufthansa
because Antiporda dealt exclusively with it which issued
him a Lufthansa ticket for the entire trip. By issuing a
confirmed ticket, Lufthansa in effect guaranteed Antiporda
a sure seat with Air Kenya.
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American Airlines (AA) v. Court of Appeals,
G.R. No. 184513 | Date: 9, 2016
Facts: Long story short, Mendoza purchased conjunction
tickets, with several interconnecting flights, from SA. He
decides to skip the second to the last leg of his trip and so
he exchanges his tickets for the last two legs of his trip for
a one-way ticket from Geneva to NY.
AA accepts the tickets, claimed the value thereof
from the International Air Transport Association (IATA)
clearing house, and issues a new ticket to Mendoza.
AA’s security treats Mendoza like shit so he sues
their ass for damages in Cebu. AA then claims Philippines
has no jurisdiction since their transaction with Mendoza
was made in Geneva and is separate and distinct from
Mendoza’s transaction with SA.
● Mendoza purchased from Singapore Airlines (SA)
conjunction tickets for Manila - Singapore -
Athens - Larnaca - Rome- Turin - Zurich - Geneva
- Copenhagen - New York. American Airlines (AA)
was not a participating airline in any of the
segments in the itinerary under the said
conjunction tickets.
● In Geneva, Mendoza decided to go straight to NY
and exchanged the unused portion of the
conjunction ticket for a one-way ticket from
Geneva to NY from AA which issued its own ticket
to Mendoza in Geneva. AA then claimed the value
of the unused portion of the conjunction ticket
from the International Air Transport Association
clearing house in Geneva.
● Thereafter, Mendoza filed an action for damages
before the Cebu RTC for the alleged
embarrassment and mental anguish he suffered
at the Geneva Airport when AA's security officers
prevented him from boarding the plane, detained
him for about an hour and allowed him to board
the plane only after all the other passengers have
boarded.
● AA filed a MTD for lack of jurisdiction of Philippine
courts to entertain the said proceedings under
Art. 28 (1) of the Warsaw Convention (the
Convention).
Petitioner’s Argument/s (LOST):
● AA asserts that local courts have no jurisdiction
over the case since Philippines is not its domicile,
its principal place of business, the place of
destination or even the place where the contract
of carriage was made between the parties.
● AA's issuance of its own ticket in Geneva in
exchange for the conjunction ticket issued by SA
for the final leg of the Mendoza's trip gave rise to
a separate and distinct contract of carriage from
that entered into by Mendoza with SA in Manila.
● AA stressed that the plane ticket for a direct fight
from Geneva to NY was purchased by Mendoza by
 "exchange and cash", signifying that his contract
of carriage with SA was terminated and a 2nd
contract was perfected. Moreover, the said
contract of carriage cannot be deemed to have
been an extension of the 1st as AA is not a
participating airline in any of the destinations
under the 1st contract. As such, it did not act as
SA’s agent.
Respondent’s Argument/s (WON):
● Assuming the Convention applies, his trips under
the conjunction tickets issued by SA is regarded
as a single transaction. As such the final leg of his
trip from Geneva to New York with AA is part and
parcel of the original contract of carriage
perfected in Manila.
● Thus, the third option of the plaintiff under Art.
28 (1) e.g., where the carrier has a place of
business through which the contract of carriage
was made, applies herein and the case was
properly filed in the Philippines.
● AA acted as SA’s agent under the IATA Rules and
as an agent of the principal carrier, AA may be
held liable under the contract of carriage
perfected in Manila, citing AA’s judicial admission
that it claimed the value of the unused portion of
Mendoza's conjunction tickets from the IATA
Clearing House in Geneva where the accounts of
both airlines are respectively credited and
debited.
Ruling of the lower court:
● RTC denied the MTD, with CA affirming, both
courts ruling that the suit may be brought in the
Philippines.
Issue: WON AA and Mendoza’s contract of transportation
would be considered as a single operation and part of SA
and Mendoza’s contract of transportation which was
executed in Manila (YAAAAAAAS.)
Rule:
● Art. 28 (1) of the Convention states: “An action
for damages must be brought at the option of the
plaintiff, in the territory of one of the High
Contracting Parties, either before the court of the
domicile of the carrier or of his principal place of
business or where he has a place of business
through which the contract has been made, or
before the court at the place of destination.”
● Art 1(3) of the Convention states:
"Transportation to be performed by several
successive carriers shall be deemed, for the
purposes of this convention, to be one undivided
transportation, if it has been regarded by the
parties as a single operation, whether it has been
agreed upon under the form of a single contract
or a series of contracts, and it shall not lose its
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international character merely because one
contract or series of contracts is to be performed
entirely within the territory subject of the
sovereignty, suzerainty, mandate or authority of
the same High Contracting Party."
● Members of the IATA are under a general pool
partnership agreement wherein they act as agent
of each other in the issuance of tickets to
contracted passengers to boost ticket sales
worldwide and at the same time provide
passengers easy access to airlines which are
otherwise inaccessible in some parts of the world
Application:
APPLICABILITY OF THE WARSAW CONVENTION
● The Philippines is a party to the Convention and
as such, it has the force and effect of law in this
country and applies to all international
transportation of persons, baggage or goods
performed by an aircraft gratuitously or for hire.
● The contract of carriage entered into by Mendoza
with SA, and subsequently with AA, is a contract
of international transportation and the provisions
of the Convention automatically apply and
exclusively govern the rights and liabilities of the
airline and its passengers, including Sec. 28 (1)
which enumerates the 4 places where an action
for damages may be brought.
GENEVA TRANSACTION PART OF THE MANILA
TRANSACTION
● The contract of carriage between Mendoza and
SA, although performed by different carriers
under a series of airline tickets, including that
issued by AA, constitutes a single operation. Art.
1(3) clearly states that a contract of air
transportation is taken as a single operation
whether it is founded on a single contract or a
series of contracts.
● The number of tickets issued does not detract
from the oneness of the contract of carriage as
long as the parties regard the contract as a single
operation. AA's acquiescence to take the place of
the original designated carrier binds it under the
contract of carriage entered into by Mendoza and
SA in Manila.
AMERICAN AIRLINES ACTED AS AN AGENT OF
SINGAPORE AIRLINES
● When AA accepted the unused portion of the
conjunction tickets, entered it in the IATA clearing
house pursuant to the required process of
interline settlement of accounts, and undertook
to transport the private respondent over the
route covered by the unused portion of the
conjunction tickets, i.e., Geneva to NY, AA tacitly
recognized its commitment under the IATA pool
arrangement to act as agent of the principal
 contracting airline, SA, as to the segment of the
trip Mendoza agreed to undertake. As such, AA
thereby assumed the obligation to take the place
of the carrier originally designated in the original
conjunction ticket.
● Consequently, the new ticket was simply a
replacement for the unused portion of the
conjunction ticket, both tickets being for the
same amount and having the same points of
departure and destination.
● By constituting itself as an agent of the principal
carrier, AA's undertaking should be taken as part
of a single operation under the contract of
carriage executed by the private respondent and
SA in Manila.
PHILIPPINE COURTS HAVE JURISDICTION
● Since the Geneva transaction is considered part
of the Manila transaction, the 3rd option of the
plaintiff under Art. 28 (1) of the Convention, i.e.
to sue in the place of business of the carrier
wherein the contract was made, is therefore,
validly exercised by Mendoza.
● We note that while this case was filed in Cebu and
not in Manila the issue of venue is no longer an
issue as the petitioner is deemed to have waived
it when it presented evidence before the trial
court.
China Airlines v. Chiok,
G.R. No. 152122 | July 30, 2003
Facts:
Petitioner China Airlines (CAL) issued tickets to
respondent, Daniel Chiok, for his Manila-Taipei-Hongkong-
Manila tour which was exclusively endorseable to
Philippine Airlines, Ltd. (PAL).
In Hongkong, the PAL office likewise confirmed
respondent's return trip to Manila on board Flight No. PR
311.
On November 24, the day of his departure, PAL was unable
to transport respondent on Flight PR 311 due to typhoon
which was automatically booked to the next available
flight, PR 307, on the following day.
However, on November 25, respondent was harangued
and prevented from boarding PR 307 because his name did
not appear from the computerized passenger list despite
his confirmed flight tickets.
Thereafter, Chiok proceeded to PAL’s Hongkong office and
confronted PAL’s reservation officer, Carie Chao, who
previously confirmed his flight back to Manila. Chiok was
not able to return to Manila on time. Consequently, Chiok
filed a complaint for damages against PAL and CAL.
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Petitioner’s Argument/s (LOST):
CAL argued that it is not liable since it merely acted as an
issuing agent for the ticket covering the Hong Kong-Manila
leg of respondent's journey.
Respondent’s Arguments (WON):
Chiok argued that defendants are solidarily liable for the
damages he suffered despite several confirmations of his
flight, since one is the agent of the other.
Ruling of the lower court:
RTC – held CAL and PAL jointly and severally liable to
respondent.
CA – affirmed RTC’s decision and debunked petitioner’s
claim that it had merely acted as an issuing agent for the
ticket covering the Hong Kong-Manila leg of respondent's
journey.
It ruled that under the contract of transportation,
petitioner, as the ticket-issuing carrier, was liable
regardless of the fact that PAL was to perform or had
performed the actual carriage, citing KLM v. CA.
Issue:
Considering the fact that CAL was only the ticket issuer,
may it be held jointly and severally liable with PAL to
respondent? YES.
Rule:
Article 1, Section 3 of the Warsaw Convention:
"Transportation to be performed by several successive air
carriers shall be deemed, for the purposes of this
Convention, to be one undivided transportation, if it has
been regarded by the parties as a single operation,
whether it has been agreed upon under the form of a single
contract or of a series of contracts, and it shall not lose its
international character merely because one contract or a
series of contracts is to be performed entirely within a
territory subject to the sovereignty, suzerainty, mandate,
or authority of the same High Contracting Party.”
Article 15 of IATA-Recommended Practice:
"Carriage to be performed by several successive carriers
under one ticket, or under a ticket and any conjunction
ticket issued therewith, is regarded as a single operation.”
American Airlines v. CA:
Under a general pool partnership agreement, the ticket-
issuing airline is the principal in a contract of carriage,
while the endorsee-airline is the agent.
British Airways v. CA:
The petitioner was held liable, even when the breach of
contract had occurred, not on its own flight, but on that of
another airline.
Lufthansa German Airlines v. CA:
The obligation of the ticket-issuing airline remained and
did not cease, regardless of the fact that another airline
had undertaken to carry the passengers to one of their
destinations.
Application:
It is significant to note that the contract of air
transportation was between petitioner and respondent,
with the former endorsing to PAL the Hong Kong-to-Manila
segment of the journey.
Such contract of carriage has always been treated in this
jurisdiction as a single operation. This jurisprudential
rule is supported by the Warsaw Convention, to which the
Philippines is a party, and by the existing practices of the
International Air Transport Association (IATA).
therein specified are present. Neither said provisions nor
others in the aforementioned Convention regulate or
exclude liability for other breaches of contract by the
carrier. Under petitioner's theory, an air carrier would be
exempt from any liability for damages in the event of its
absolute refusal, in bad faith, to comply with a contract of
carriage, which is absurd.
Respondent’s Arguments: (LOST)
Ruling of the lower court:
Cuenca brought suit in the CFI in Manila which held
Northwest liable for damages; this was affirmed by the CA.
Issue:

Following the jurisprudence above, PAL acted as the
carrying agent of CAL. Thus, CAL cannot evade liability to
respondent, even though it may have been only a ticket
issuer for the Hong Kong-Manila sector.
1. WON Cuenca have a cause of action against Northwest.
(YES)
2. WON the award of nominal damages proper. (YES)

Articles 17, 18, 19

Rule and Application:

Northwest Airlines, Inc. v. Cuenca, et al.,

1. Petitioner argues that pursuant to those provisions, an
G.R. No. L-22425| Date: August 31, 1965
air "carrier is liable only" in the event of death of a
passenger or injury suffered by him, or of destruction or
Facts:
loss of, or damage to any checked baggage or any goods,
or of delay in the transportation by air of passengers,
Respondent Nicolas L. Cuenca (Cuenca) was the
baggage or goods. This pretense is not borne out by the
Commissioner of Public Highways; he was the official
language of said Articles. The instances specified in Arts.
delegate of the Philippines to a conference in Tokyo and,
17-19 of the Warsaw Convention merely declare the
thus, he purchased a first-class ticket from petitioner
carrier liable for damages in the enumerated cases, if the
Northwest Airlines, Inc. (Northwest). His ticket was
conditions therein specified are present.
marked “W/L” meaning he was waitlisted but his attention
was never called thereto and he wasn’t advised what it
· Neither said provisions nor others in the
meant. Cuenca was given first class accommodation upon
aforementioned Convention regulate or exclude
boarding the plane in Manila but, upon arrival at Okinawa,
liability for other breaches of contract by the
he was transferred to the tourist class. Although he
carrier. Otherwise, an air carrier would be exempt
revealed that he was traveling in his official capacity, an
from any liability for damages in the event of its
agent of Northwest rudely compelled him in the presence
absolute refusal, in bad faith, to comply with a
of other passengers to move, over his objection, to the
contract of carriage.
tourist class, under threat of otherwise leaving him in
· Thus, Cuenca has a cause of action for breach of
Japan. Cuenca brought suit in the CFI in Manila which held
contract against Northwest.
Northwest liable for damages; this was affirmed by the CA.

2. The award of nominal damages is proper considering

that the CA has adjudicated no compensatory, moral, and
Petitioner’s Argument/s: (WON)
exemplary damages to Cuenca.

Petitioner argues that pursuant to those provisions, an air

· Also, it is proper considering the following
"carrier is liable only" in the event of death of a passenger
circumstances:
or injury suffered by him, or of destruction or loss of, or
o Cuenca was never advised that he was merely
damage to any checked baggage or any goods, or of delay
waitlisted;
in the transportation by air of passengers, baggage or
o After having been given first class
goods. This pretense is not borne out by the language of
accommodation in Manila, Cuenca was
said Articles. The same merely declare the carrier liable for
entitled to believe that his first class
damages in the enumerated cases, if the conditions
reservation was confirmed and would

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 continue until his ultimate destination,
Tokyo;
o Notwithstanding this, Northwest rudely
breached the contract, even with full
knowledge of the fact that Cuenca was an
official representative of the Philippines;
Northwest never explained that the person to
whom Cuenca’s first class seat was given had
a better right thereto.
· At any rate, considering the Northwest’s agent
had acted in a wanton, reckless, and oppressive
manner, said award may also be considered as
one for exemplary damages.
Arts. 17-19 of the Warsaw Convention
ART. 17. The carrier shall be liable for damages sustained
in the event of the death or wounding of a passenger or
any other bodily injury suffered by a passenger, if the
accident which caused the damage so sustained took place
on board the aircraft or in the course of any of the
operations of embarking or disembarking.
ART. 18. (1) The carrier shall be liable for damage
sustained in the event of the destruction or loss of, or of
damage to, any checked baggage, or any goods, if the
occurrence which caused the damage so sustained took
place during the transportation by air.
(2) The transportation by air within the meaning of the
preceding paragraph shall comprise the period during
which the baggage or goods are in charge of the carrier,
whether in an airport or on board an aircraft, or, in the
case of a landing outside an airport, in any place
whatsoever.
(3) The period of the transportation by air shall not extend
to any transportation by land, by sea, or by river
performed outside an airport. If, however, such
transportation takes place in the performance of a contract
for transportation by air, for the purpose of loading,
delivery, or transhipment, any damage is presumed,
subject to proof to the contrary, to have been the result of
an event which took place during the transportation by air.
ART. 19. The carrier shall be liable for damage occasioned
by delay in the transportation by air of passengers,
baggage, or goods.
Philippine Airlines, Inc. v. IAC, et al.,
G.R. No.70481 | December 11, 1992
Facts:
Respondents Sps. Lorenzana sued the Petitioner for breach
of contract. The respondents checked in two pieces of
baggage for their Manila to Honolulu flight via Tokyo on
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8/4/1974 with the Petitioner. On the Tokyo-Honolulu leg,
they changed planes from PAL to Pan Am. Upon arrival in
Honolulu, only one baggage was located and the other
baggage went missing. The couple proceeded with their
trip to Mainland US and Canada and returned to the
Manila.
The missing luggage was found April 1975 and was
eventually delivered back to the couple on December
1975.
Petitioner’s Argument/s: (Lost) The Respondents
omitted to retrieve the bag after they were informed of its
discovery and that the carrier’s liability under the Warsaw
Convention is limited in the absence of a declaration from
the passenger of a higher value
Respondent’s Arguments: (Won) Breach of Contract
on the part of the petitioner’s failure to deliver the luggage.
Petitioner is liable for the cost of the whole trip and loss of
income among others since the missing luggage contained
samples of goods to be presented to potential buyers in
US and Canada.
Ruling of the lower court: The Trial court found the
petitioner accountable for the non-delivery mainly due to
the petitioner’s frank representation that it breached the
contract with the respondents. The Appellate court in
affirming the trial court relied more on the presumption of
culpa which Petitioner PAL was not able to overcome.
Further the caveat under the Warsaw Convention was held
inapplicable since the luggage was not delivered to the
respondents during the whole trip
Issue:
Whether the limited liability clause for loss, damage or
delay of luggage under Art. 22 and 2nd par. Art. 26 of the
Warsaw Convention applies considering that the bag was
neither lost nor damaged and delivery was merely
delayed.
Rule:
Petition is dismissed and decision of the respondent court
is affirmed. There is no occasion to speak of delay since
the baggage was not delivered at all to the passenger for
the purposes of the trip in contravention of the carrier’s
undertaking to transport the goods from the place of
embarkation to the ultimate point of destination. The
missing luggage was not turned over by the employees of
the Petitioner to the Pan Am office in Tokyo and was
returned to Manila. Worse, said luggage was not promptly
returned to the repondents upon their return to Manila and
it was until over a year after when the luggage was finally
delivered to the respondents.
Application:
The limited liability clause under the Warsaw Convention
cannot warrant the exemption from liability of petitioner
PAL since the said clause contemplates a mere delay in the
delivery of the baggage. Based on the proven facts, there
was non-delivery since the said baggage was returned long
after the end of the respondents’ trip.
Articles 22
Philippine Air Lines v. Hon. Court of Appeals
G.R. No. L- 44936 | September 25, 1992
Facts:
Private respondent (PR) boarded herein petitioner's Flight
PR 301 from Hongkong to Manila and checked in four (4)
pieces of baggage.
When the plane landed in Manila, PR was not able to locate
the two pieces of baggage containing cinematographic
films despite diligent search therefor.
PR made the claim for such loss to petitioner which
admitted the loss and offered to compensate PR.
Instead of accepting the offer, PR opted to file the case
below to principally recover the value of the lost items
which he estimated to be worth P20,000.00.
Petitioner’s Argument - LOST
On the merits of private respondent's plea for relief,
petitioner invoked provisions of the Warsaw Convention
which limit the liability of petitioner as an air carrier to 250
francs per kilogram.
It further argued that the ticket under which PR was a
passenger on petitioner's plane was a passenger ticket and
baggage check at the same time. This is to establish the
conclusion that petitioner could not have produced the
same since the ticket is usually retained by the passenger.
Respondent’s Argument – WON (this is also the lower
court’s decision)
Lower court ruled that the petitioner did not introduce a
single piece of document and merely adopted private
respondent's exhibits, it may not invoke the limitation of
its liability with respect to 'checked baggage' under the
provisions of the Warsaw Convention.
Issue: WON Petitioner-PAL can avail of the limitations on
liability under the Warsaw Convention? NO
Rule and Application
It may be recalled that petitioner made a categorical
distinction between a passenger ticket and a baggage
check when the petitioner responded to the complaint for
a sum of money.
And then, petitioner had a sudden change of heart by
asserting that the passenger ticket and the baggage check
are one and the same thing.
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On a later occasion, it stressed that the 'baggage tags'
were erroneously labeled as 'baggage checks'.
But the question of semantics on whether the
passenger ticket, the baggage check, and the tag
refer to the same object is undoubtedly without
legal significance and will not obliterate the fact that
the baggage check was not presented by petitioner
in the trial court inasmuch as it merely relied on, and
adopted private respondent's exhibits, none of which
was offered for the purpose of proving the missing link, so
to speak.
To rectify these lapses, petitioner argued that it is not in a
position to introduce the baggage check in evidence since
PR as passenger, is the one who retains possession
thereof. Yet, such pretense does not sit well with what is
expected of petitioner as an air carrier under Article 4 (2),
Section II of the Warsaw Convention that: "The baggage
check shall be made out in duplicate, one part for the
passenger and the other part for the carrier."
Consequently, petitioner cannot capitalize on the limited
liability clause under Article 22 (2) of the Warsaw
Convention because of the unequivocal condition set forth
under the second sentence of Article 4, paragraph 4 that:
" The absence, irregularity, or loss of the baggage checks
shall not affect the existence or the validity of the contract
of transportation which shall nonetheless be subject to the
rules of this convention. Nevertheless, if the carrier
accepts baggage without a baggage check having been
delivered, or if the baggage check does not contain the
particulars set out at (d), (f), and (h) above, the carrier
shall not be entitled to avail himself of those provisions of
the Convention which exclude or limit his liability."
Petitioner contends that it is covered by the first and not
by the second sentence of Article 4, paragraph 4. But the
argument as preferred, requires us to read something
which is not so stated between the lines for the first
sentence speaks only of the "existence" or the "validity" of
the contract of transportation while the query on "liability"
is particularly and directly resolved by the second
sentence.
To be sure, and even assuming in gratia argumenti that an
inconsistency exists, the first sentence must be construed
as the general proposition governing the existence or
validity of the contract of transportation which must yield
to the particular rule under the second sentence regarding
liability.
Furthermore, even if we consider the two sentences as
particular in nature, the rule has been laid down that the
clause which comes later shall be given effect upon the
presumption that it expresses the dominant purpose of the
instrument.
 Pan American World Airways, Inc. v. IAC,
G.R. No. G.R. No. 70462 | August 11,1988
Facts:
● Private respondent Pangan undertook to provide
the necessary promotional and advertising
materials for several films abroad. Likewise, in
preparation for his trip, Pangan purchased
fourteen clutch bags, four capiz lamps and four
barong tagalog.
● Two hours before departure time, Pangan
presented his ticket at the ticket counter at Manila
International Airport and checked in his two
luggages, for which he was given baggage claim
ticket numbers.
● Pangan was subsequently informed that his name
was not in the manifest and so he could not take
the said flight in the economy class. To comply
with his commitment, He took the first class and
paid an additional sum.
● When Pangan arrived in Guam, his two luggages
did not arrive with his flight, as a consequence of
which his agreements with Slutvhnick and
Quesada for the exhibition of the films in Guam
and in the United States were cancelled. He then
filed a written claim for his luggage.
● Upon arrival in the Philippines, Pangan, with his
lawyer, made the necessary protest in relation to
the loss of luggages.
Petitioner’s Argument/s (WON):
On the basis of the Notice of Baggage Liability
Limitations its liability for the lost baggage of private
respondent Pangan is limited to $600.00 ($20.00 x 30
kilos) as the latter did not declare a higher value for
his baggage and pay the corresponding additional
charges.
Respondent’s Arguments (LOST):
As a result of the loss of his luggages while on board
the petitioner’s carrier, his agreements for the
exhibition of the films in Guam and the US were
cancelled. Thus, the carrier is liable for the loss of his
luggages and actual damages as a result of the
cancellation of the contracts he entered abroad.
Ruling of the lower court:
● CFI: It ordered Petitioner liable to pay ALL to
Pangan the sum for actual damages, with interest
at the rate of 14% per annum plus further sum
for attorney’s fees, and an additional amount for
actual damages.
● IAC: Affirmed CFI’s decision
Issue:
● WON respondent court erred in affirming the trial
court’s award of actual damages beyond the
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limitation of liability set forth in the Warsaw
Convention and the contract of carriage. (YES)
● WON respondent court erred in affirming the trial
court's award of actual damages consisting of
alleged lost profits as set forth in Mendoza v. PAL.
(YES)
Rule:
● Art. 1750 of the NCC states that a contract fixing
the sum that may be recovered by the owner or
shipper for the loss, destruction, or deterioration
of the goods is valid, if it is reasonable and just
under the circumstances, and has been fairly and
freely agreed upon.
● Warsaw Convention provides that "[i]n the
transportation of checked baggage and of goods,
the liability of the carrier shall be limited to a sum
of 250 francs per kilogram, unless the consignor
has made, at the time when the package was
handed over to the carrier, a special declaration
of the value of delivery and has paid a
supplementary sum if the case so requires. In
that case, the carrier will be liable to pay a sum
not exceeding the declared sum, unless he proves
that the sum is greater than the actual value to
the consignor at delivery.. The sums mentioned
above shall be deemed to refer to the French
franc consisting of 65-1/2 milligrams of gold at
the standard of fineness of nine hundred
thousandths. These sums may be converted into
any national currency in round figures."
● Art. 1107 of the Civil Code, a debtor in good faith,
may be held liable only for damages that were
foreseen or might have been foreseen at the time
the contract of transportation was entered into.
Application:
The Court finds the ruling in Ong Yiu v. CA applicable
where the Court sustained the validity of a printed stipulation at
the back of an airline ticket limiting the liability of the carrier for
lost baggage to a specified amount and ruled that the carrier's
liability was limited to said amount since the passenger did not
declare a higher value, much less pay additional charges. In
view thereof petitioner's liability for the lost baggage is
limited to $20.00 per kilo or $600.00, as stipulated at
the back of the ticket.
Moreover, the Court held that CA’s reliance in the case
of Northwest Airlines, Inc. v. Cuenca [G.R. No. L-22425,
August 31, 1965, 14 SCRA 1063] to sustain the view
that "to apply the Warsaw Convention which limits a
carrier's liability to US$9.07 per pound or US$20.00 per
kilo in cases of contractual breach of carriage is against
public policy" is utterly misplaced. Hence, Warsaw
convention is applicable in this case.
As to the issue on actual damages, the Court ruled that
in the absence of showing that petitioner's attention was
 called to the special circumstances requiring prompt
delivery of private respondent Pangan's luggages,
petitioner cannot be held liable for the cancellation of
private respondents' contracts as it could not have
foreseen such an eventuality when it accepted the
luggages for transit. This is consistent with the Court’s
ruling in the case of Mendoza vs. PAL, Inc. [90 Phil. 836
(1952)]. In the present case, it was further established
by evidence that the proximate cause of cancellation of
Pangan’s contracts abroad was due to the latter’s failure
to deliver the materials on the dates agreed upon.
Thus, pursuant to Art. 1107 of the Civil Code, herein
petitioner acted in good faith and cannot be held liable
for the unforeseen damages which is the cancellation of
Pangan’s contract abroad.
Application of NCC/Other laws/Not an exclusive
enumeration
Philippine Air Lines v. Court of Appeals & Co
G.R. No. 92501| March 6, 1992
Facts:
Co and his family arrived at the Manila International
Airport aboard PAL Flight from San Francisco, California.
Upon arrival, he proceeded to the baggage retrieval area
to claim his checked-in luggage with the corresponding
claim checks in his possession. Co found eight of his
luggage, but despite diligent search, he failed to locate the
ninth luggage.
Despite the demand letter, PAL through its Central
Baggage Services never found Co's missing luggage or
paid its corresponding value. Consequently, Co filed his
present complaint against PAL for damages.
Petitioner’s Argument/s: (LOST)
PAL contends that under the Warsaw Convention, its
liability, if any, cannot exceed US $20.00 based on weight
as private respondent Co did not declare the contents of
his baggage nor pay additional charges before the flight.
Respondent’s Arguments:
Ruling of the lower court:
RTC held PAL liable for actual and exemplary damages,
attorney’s fees and other cost of suit. On appeal, the Court
of Appeals affirmed in toto the trial court's award.
Issue:
WON Court of Appeal erred in not applying the limits of
liability under the Warsaw Convention which limits the
liability of an air carrier for loss, delay or damage to
checked-in baggage to US $20.00 based on weight.
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Rule:
No. The Court of Appeals did not err in disregarding the
limits of liability under the Warsaw Convention because
Philippine law governs the liability of the carrier for the loss
of the passenger's luggage.
In Samar Mining Company, Inc. vs. Nordeutscher Lloyd
(132 SCRA 529), this Court ruled: "The liability of the
common carrier for the loss, destruction or deterioration
of goods transported from a foreign country to the
Philippines is governed primarily by the New Civil
Code. In all matters not regulated by said Code, the
rights and obligations of common carriers shall be
governed by the Code of Commerce and by Special Laws."
The provisions of the New Civil Code on common carriers
are Articles 1733, 1735 and 1753.
Since the passenger's destination in this case was the
Philippines, Philippine law governs the liability of the
carrier for the loss of the passenger's luggage.
Application:
In this case, the petitioner failed to overcome, not only the
presumption, but more importantly, the private
respondent's evidence, proving that the carrier's
negligence was the proximate cause of the loss of his
baggage. Furthermore, the petitioner acted in bad faith in
faking a retrieval receipt to bail itself out of having to pay
Co's claim.
Luna, et al. v. Hon. Court of Appeals, et al.
G.R. No. 100374-75 | Date: Nov. 27, 1992
Facts:
On 19 May 1989, petitioners Luna, Alonso, and Rodriguez
boarded flight 020 of private respondent Northwest
Airlines bound for Seoul, South Korea to attend a 4 day
Rotary International Convention from May 21-24, 1989.
They checked in 1 luggage each. However, they had to
transfer to Korean Airlines due to respondent’s engine
trouble. They were assured that their baggage would be
with them in the same flight.
When petitioners arrived in Seoul, they learned that their
belongings were nowhere to be found; instead, their
belongings were flown to Seattle, USA. They were able to
retrieve their bags 4 days later, after repeated demands.
By then, the convention they were supposed to attend was
almost over.
Petitioners Luna & Alonso jointly filed a complaint for
breach of contract with damages before the RTC of Pasig
while Rodriguez filed in RTC Valenzuela.
Petitioner’s Argument/s (WON):
● Petitioners Luna & Alonso assert that they sent a
written claim to the airlines on 6 June 1989, 13
 days after they recovered their luggage.
Petitioner Rodriguez, on the other hand, claimed
to have filed his claim on 13 June 1989, 20 days
later.
● The respondent appellate court disregarded SC’s
ruling in Alitalia v. CA where it was ruled that
"[t]he Convention does not thus operate as an
exclusive enumeration of the instances of an
airline's liability, or as an absolute limit of the
extent of that liability."
● The petitions to revoke orders and decisions may
be entertained even after the time to appeal had
elapsed, in cases wherein the jurisdiction of the
court had been exceeded.
● Art. 26 of the Warsaw Convention which
prescribes the reglementary period within which
to file a claim cannot be invoked if damage is
caused by the carrier's willful misconduct, as
provided by Art. 25 of the same Warsaw
Convention.
Respondent’s Arguments (LOST):
● Private respondent disowned liability for the delay
and averred that it exerted “its best efforts to
carry the passenger and baggage with reasonable
dispatch.”
● They also had the complaints of petitioners
dismissed on the ground for lack of cause of
action due to petitioner’s failure to state in their
respective complaints that they filed a prior claim
within the prescribed period.
● They argue that the dismissal orders of
respondent courts had already become final after
petitioners failed to either move for
reconsideration or appeal from the orders within
the reglementary period, hence, certiorari is no
substitute for a lost appeal.
● It did not receive any demand letter from
petitioners within the 21-day reglementary
period, as provided in par. 7 of the Conditions of
Contract appearing in the plane ticket.
● Art. 26, par. (4), of the Warsaw Convention
provides that "[f]ailing complaint within the times
aforesaid, no action shall lie against the carrier,
save in the case of fraud on his part," the carrier
consequently cannot be held liable for the delay
in the delivery of the baggage. In other words,
non-observance of the prescribed period to file a
claim bars claimant's action in court for recovery.
● They likewise submit that Art. 25, par. (1), of the
Warsaw Convention which excludes or limits
liability of common carriers if the damage is
caused by its willful misconduct, refers only to the
monetary ceiling on damages found in Art. 22.
Ruling of the lower court: RTC & CA dismissed the
petitions.
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RTC dismissed the petitions for lack of cause of action due
to petitioners’ failure to state in their respective complaints
that they filed a prior claim within the prescribed period.
Because of this, petitioners Luna & Alonso filed a petition
for certiorari before the CA to set aside the order granting
respondent’s motion to dismiss. While Petitioner Rodriguez
proceeded directly to the SC to file a certiorari for the same
purpose. SC on that matter, referred the certiorari of
Rodriguez back to SC.
On 26 March 1991, CA applied the provisions of the
Warsaw Convention and ruled that certiorari was
not a substitute for a lost appeal. Hence, it dismissed
the petition filed by Luna & Alonso as well as Rodriguez’s
petition.
Issue:
1. W/N the Convention operates as an exclusive
enumeration of the instances of an airline’s
liability. (NO)
2. W/N Art. 26 of the Warsaw Convention which
prescribes the reglementary period within which
to file a claim cannot be invoked if damage is
caused by the carrier’s willful misconduct. (NO)
Rule: The application of the Warsaw Convention must not
be construed to preclude the operation of the Civil Code
and other pertinent laws.
Application:
The Warsaw Convention does not operate as an exclusive
enumeration of the instances for declaring an airline liable
for breach of contract of carriage or as an absolute limit of
the extent of that liability. The Convention merely declares
the carrier liable for damages in the enumerated cases, if
the conditions therein specified are present. It does not
regulate the liability, much less exempt, the carrier for
violating the rights of others which must simply be
respected in accordance with their contracts of carriage.
The application of the Convention must not therefore be
construed to preclude the operation of the Civil Code and
other pertinent laws.
Hence, petitioners' failure to file a claim with the
common carrier as mandated by the provisions of
the Warsaw Convention should not be a ground for
the summary dismissal of their complaints since
private respondent may still be held liable for breach of
other relevant laws which may provide a different period
or procedure for filing a claim
As to the second issue, SC held that Art. 25 of the
Convention operates to exclude the other provisions of the
Convention operates to exclude the other provisions of the
Convention if damage is caused by the common carrier's
willful misconduct. Art. 25 refers only to the monetary
ceiling on damages found in Art. 22 should damage be
caused by the carrier's willful misconduct. Hence, only the
provisions of Art. 22 limiting the carrier's liability and
imposing a monetary ceiling in case of willful misconduct
on its part that the carrier cannot invoke. SC likewise
disagreed with the petitioners when it claimed that the
respondent’s failure to deliver their luggage at the
designated time and place amounted ipso facto to willful
misconduct. For willful misconduct to exist, there must be
a showing that the acts complained of were impelled by an
intention to violate the law, or were in persistent disregard
of one's rights. It must be evidenced by a flagrantly or
shamefully wrong or improper conduct.
Cathay Pacific Airways, Ltd. v. Court of Appeals
G.R. No. 60501| Date March 5, 1993
Facts:
● Tomas Alcantara, a first class passenger of
Cathay Pacific Airways, Ltd. flying from Manila to
Hongkong and to Jakarta for a conference, lost
his luggage. The luggage contained his clothing,
articles for personal use and papers and
documents he needed for the conference to meet
the Director General of Trade of Indonesia.
● In Jakarta, upon discovery that the luggage was
missing, he inquired from Cathay’s representative
and was offered $20.00 as “inconvenience”
money to buy his immediate personal needs until
the luggage could be delivered to him.
● The luggage finally reaching Jakarta more than
24 hours after his arrival, was not delivered to
him at his hotel but was required by Cathay to be
picked up by an official of the Philippine Embassy.
● Alcantara filed a complaint asking for damages.
Petitioner’s Argument/s:
· Cathay should not be held liable to Alcantara for
damages and fees
o Although it failed to transport the
luggage on time, the 1day delay was not
made in bad faith so as to justify the
payment of damages
· The CA should have applied the Warsaw
Convention on the liability of a carrier to its
passengers
Respondent’s Arguments:
· Damages are in order because Alcantara was
treated rudely and arrogantly when he sought
assistance from the employees
Ruling of the lower court:
Cathay Pacific is ordered to pay Alcantara moral,
temperate, and exemplary damages. CA affirmed but
increased the amount of damages.
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Issue:
Whether or not the CA should have adhered to the
principles in the Warsaw Convention
-NO, the Warsaw Conventionis not an exclusive
enumeration of instances for the liability of the
carrier. It does not preclude the Civil Code and other
pertinent laws.
Rule:
The Warsaw Convention itself provides in Art. 25 that —
"(1) The carrier shall not be entitled to avail himself of the
provisions of this convention which exclude or limit his
liability, if the damage is caused by his willful misconduct
or by such default on his part as, in accordance with the
law of the court to which the case is submitted, is
considered to be equivalent to wilfull misconduct."
(2) Similarly the carrier shall not be entitled to avail
himself of the said provisions, if the damage is caused
under the same circumstances by any agent of the carrier
acting within the scope of his employment."
Application:
Cathay breached its contract of carriage with private
respondent when it failed to deliver his luggage at the
designated place and time, it being the obligation of a
common carrier to carry its passengers and their luggage
safely to their destination, which includes the duty not to
delay their transportation, and the evidence shows that
petitioner acted fraudulently or in bad faith.
o Cathay was not even aware that it left
behind Alcantara's luggage until its
attention was called by the Hongkong
Customs authorities.
o The duty officer answered back to Mr.
Alcantara saying 'What can we do, the
baggage is missing. I cannot do
anything.' something like it. 'Anyhow
you can buy anything you need, charged
to Cathay Pacific.'
• As We have repeatedly held, although the Warsaw
Convention has the force and effect of law in this country,
being a treaty commitment assumed by the Philippine
government, said convention does not operate as an
exclusive enumeration of the instances for declaring
a carrier liable for breach of contract of carriage or
as an absolute limit of the extent of that liability. The
Warsaw Convention declares the carrier liable for damages
in the enumerated cases and under certain limitations.
However, it must not be construed to preclude the
operation of the Civil Code and other pertinent laws.
It does not regulate, much less exempt, the carrier from
liability for damages for violating the rights of its
passengers under the contract of carriage, especially if
wilful misconduct on the part of the carrier's employees is
found or established, which is clearly the case before Us.
• Alcantara is entitled to moral and exemplary damages
and attorney’s fees. Temperate damages was deleted.
Philippine Airlines, Inc. v. Court of Appeals
G.R. No. 119706 | March 14, 1996
Facts:
On January 27, 1990, plaintiff Gilda C. Mejia shipped thru
defendant, Philippine Airlines, one (1) unit microwave
oven, with a gross weight of 33 kilograms from San
Francisco, U.S.A. to Manila, Philippines. Upon arrival,
however, of said article in Manila, Philippines, plaintiff
discovered that its front glass door was broken and the
damage rendered it unserviceable. Demands both oral and
written were made by plaintiff against the defendant for
the reimbursement of the value of the damaged
microwave oven, and transportation charges paid by
plaintiff to defendant company. But these demands fell on
deaf ears.
Plaintiff Gilda Mejia testified that sometime on January 27,
1990, she took defendants plane from San Francisco,
U.S.A. for Manila, Philippines. Amongst her baggage was a
slightly used microwave oven with the brand name Sharp
under PAL Air Waybill No. 0-79-1013008-3. When shipped,
defendant's office at San Francisco inspected it. It was in
good condition with its front glass intact. She did not
declare its value upon the advice of defendant's personnel
at San Francisco.
When she arrived in Manila, she gave her sister
Concepcion C. Dio authority to claim her baggage and took
a connecting flight for Bacolod City. When Concepcion C.
Dino claimed the baggage with defendant, then with the
Bureau of Customs, the front glass of the microwave oven
was already broken and cannot be repaired because of the
danger of radiation. They demanded from defendant thru
Atty. Paco P30,000.00 for the damages although a brand
new one costs P40,000.0, but defendant refused to pay.
Petitioner’s Argument/s (LOST):
● that both respondent court and the trial court
erred in finding that petitioner's liability, if
any, is not limited by the provisions of the air
waybill, for, as evidence of the contract of
carriage between petitioner and private
respondent, it substantially states that the
shipper certifies to the correctness of the
entries contained therein and accepts that
the carrier's liability is limited to US$20 per
kilogram of goods lost, damaged or
destroyed unless a value is declared and a
supplementary charge paid.
● that since private respondent was merely
advised, not ordered, that she need not
declare a higher value for her cargo, the final
decision of refraining from making such a
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declaration fell on private respondent and
should not put the petitioner in estoppel from
invoking its limited liability.
Respondent’s Arguments (WON - CA & Mejia):
● that the reason for the absence of a
declaration of a higher value was precisely
because petitioner’s personnel in San
Francisco, U.S.A. advised her not to declare
the value of her cargo
● that it was clearly not Mejia’s fault that the
letter of demand for damages could only be
filed, after months of exasperating follow-up
of the claim, on August 13, 1990.
Ruling of the lower court:
Declared PAL liable for the damage of the microwave oven
and ordered PAL to pay private respondent actual, moral
and exemplary damages, attorney’s fees and costs of the
suit.
Issue: Whether the limitations on liability under the
Warsaw Convention are applicable in this case (NO)
Rule:
● Under our jurisprudence, the Air Waybill is a
contract of adhesion considering that all the
provisions thereof are prepared and drafted only
by the carrier (Sweet Lines vs. Teves, 83 SCRA
361). The only participation left of the other party
is to affix his signature thereto. In the earlier case
of Angeles v. Calasanz, 135 SCRA 323, the
Supreme Court ruled that 'the terms of a contract
(of adhesion) must be interpreted against the
party who drafted the same.'
● Recognition of the Warsaw Convention does not
preclude the operation of the Civil Code and other
pertinent laws in the determination of the extent
of liability of the common carrier.
Application:
The Court finds no merit to defendant’s contention that
under the Warsaw Convention, its liability if any, cannot
exceed U.S. $20.00 based on weight as plaintiff did not
declare the contents of her baggage nor pay additional
charges before the flight.
The appellate court declared correct the non-application by
the trial court of the limited liability of therein defendant-
appellant under the Conditions of the Contract contained
in the air waybill, based on the ruling in Cathay Pacific
Airways, Ltd. vs. Court of Appeals, et al., which
substantially enunciates the rule that while the Warsaw
Convention has the force and effect of law in the
Philippines, being a treaty commitment by the government
and as a signatory thereto, the same does not operate as
an exclusive enumeration of the instances when a carrier
shall be liable for breach of contract or as an absolute limit
of the extent of liability, nor does it preclude the operation
of the Civil Code or other pertinent laws.
Petitioner is estopped from faulting private respondent for
her failure to declare the value of the microwave oven. It
will be noted that private respondent signified an intention
to declare the value of the microwave oven prior to
shipment, but was explicitly advised against doing so by
PALs personnel in San Francisco, U.S.A.
It cannot be denied that the attention of PAL through its
personnel in San Francisco was sufficiently called to the
fact that private respondent’s cargo was highly susceptible
to breakage as would necessitate the declaration of its
actual value. Petitioner had all the opportunity to check
the condition and manner of packing prior to acceptance
for shipment, as well as during the preparation of the air
waybill by PAL's Acceptance Personnel based on
information supplied by the shipper, and to reject the
cargo if the contents or the packing did not meet the
company’s required specifications. Certainly, PAL could not
have been otherwise prevailed upon to merely accept the
cargo.
Northwest Airlines, Inc. v. Court of Appeals and
Torres v. Court of Appeals
G.R. No. 120334, 120337 | Date January 20, 1998
Facts:
Torres allegedly on a special mission to purchase firearms
for the Philippine Senate, purchased a round trip ticket
from Northwest for his travel to Chicago and back to
Manila. Via Northwest’s flight, Torres left for United States.
After purchasing firearms and on the way back to Manila,
Torres checked-in and presented before Northwest's
representative his two identical baggage, one of which
contained firearms. Northwest's representative required
the baggage to be opened and the supporting evidence to
be presented. Torres showed them his authorization from
the Philippine government and the purchase receipts.
Torres thereafter sealed the baggage and defendant's
representative placed a red tag on the baggage with
firearms with the marking "CONTAINS FIREARMS".
Upon arrival in Manila on June 22, 1988 plaintiff was not
able to claim one of his baggages. Plaintiff was informed
by defendant's representative that his baggage containing
firearms was recalled back to Chicago by defendant for US
Customs verification. A telex to this effect was shown to
plaintiff.
On June 28, 1988, after being advised of the arrival of his
other baggage, plaintiff claimed and opened the baggage
in the presence of defendant's representative and found
out that the fire-arms were missing. A Personal Property
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Missing Damage Report was issued by defendant to
plaintiff.
Torres filed a complaint against Northwest.
The court ordered Northwest to pay US$9,009.32
representing the value of the goods plus other damages.
Petitioner’s Argument/s: (LOST)
Northwest alleged: a) that it was the agents from the US
Customs who ordered for the return of the weapons which
plaintiff checked-in; b) that when opened in the presence
of US Customs agents the box contained no firearms; and
c) that since the baggage which was returned back to
Chicago did not contain any firearms, then the baggage
which plaintiff received upon arrival in Manila must have
contained the firearms.
Northwest argued in its motion for summary judgment
that the Warsaw Convention and the contract of carriage
limited its liability to US$640 and that the evidence
presented by TORRES did not entitle him to moral,
exemplary, and temperate damages and attorney's fees
Respondent’s Arguments: (WON)
(Note: No specific arguments but only argued that it is
entitled to damages)
Ruling of the lower court:
In its Decision of 14 September 1994, the Court of Appeals
sustained the trial court's judgment that TORRES was
entitled to actual damages, since NORTHWEST had, in
effect, admitted the loss of the firearms when it insisted
that its liability was limited to
$9.07 per pound or $20 per kilo. The appellate court then
concluded that NORTHWEST's guessing of which luggage
contained the rearms amounted to willful misconduct
under Section 25(1) of the Warsaw Convention which
entitled TORRES to claim actual damages in excess of the
limitation provided for under Section 22(2) of said
Convention.
Issue: WON Northwest’s liability is limited to that
prescribed in Section 22(2) of the Warsaw Convention
Rule/Application:
In this case, Northwest denied in its Answer the material
allegations in the complaint and asserted, in fact, that it
was not liable for actual damages because the box
containing the alleged lost firearms was the one received
by Torres when he arrived in Manila. It likewise contended
that, even granting that the firearms were lost, its liability
was limited by the Warsaw Convention and the contract of
transportation to $9.07 per pound or a total of $640 as the
box weighed 70 pounds. 12 It also denied having acted
fraudulently or in bad faith.
In thus submitting for summary judgment the matter of
its liability only to the maximum allowed in Section 22(2)
of the Warsaw Convention, Northwest was deemed to have
hypothetically admitted arguendo that the firearms were
lost. It did not waive the presentation of evidence that it
was not in fact liable for the alleged loss of firearms. And
even if it were so liable, Northwest could still prove at the
appropriate time that it was not liable beyond the
maximum provided in said Section 22(2). Notably, Torres
prayed for actual damages in the amounts of(1) $9,009.32
representing the value of the lost firearms; and (2)
P39,065 14 representing the cost of his plane tickets.
Concretely then, there remained a genuine issue on the
fact and amount of actual damages. The motion for
summary judgment was not therefore in order.
The SC agreed with the lower courts in ruling that
Northwests’s liability for actual damages may not be
limited to that prescribed in Section 22(2) of the Warsaw
Convention. In Alitalia v. Intermediate Appellate Court, the
Court ruled that: “The [Warsaw] Convention does not
operate as an exclusive enumeration of the instances of an
airline's liability, or as an absolute limit of the extent of
that liability. Such a proposition is not borne out by the
language of the Convention, as this Court has now, and at
an earlier time, pointed out. Moreover, slight reflection
readily leads to the conclusion that it should be deemed a
limit of liability only in those cases where the cause of the
death or injury to a person, or destruction, loss or damage
to property or delay in its transport is not attributable to
or attended by any willful misconduct, bad faith,
recklessness, or otherwise improper conduct on the part
of any official or employee for which the carrier is
responsible, and there is otherwise no special or
extraordinary form of resulting injury. The Convention's
provision, in short, do not "regulate or exclude liability for
other breaches of contract by the carrier" or misconduct of
its officers and employees, or for some particular or
exceptional type of damage.
United Airlines v. Uy
G.R. No.127768 | November 19, 1999
Facts:
On October 13, 1989, respondent, a passenger of United
Airlines, checked in together with his luggage one piece of
which was found to be overweight at the airline counter.
To his utter humiliation, an employee of petitioner rebuked
him saying that he should have known the maximum
weight allowance per bag and that he should have packed
his things accordingly. Then, in a loud voice in front of the
milling crowd, she told respondent to repair his things and
transfer some of them to the light ones. Respondent
acceded but his luggage was still overweight. Petitioner
billed him overweight charges but its employee reused to
honor the miscellaneous charges under MCD which he
offered to pay with. Not wanting to leave without his
luggage, he paid with his credit card. Upon arrival in
manila, he discovered that one of his bags had been
slashed and its contents stolen. In a letter dated October
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16, 1989, he notified petitioner of his loss and requested
reimbursement. Petitioner paid for his loss based on the
maximum liability per pound. Respondent considered the
amount grossly inadequate. He sent two more letters to
petition but to no avail. On June 9, 1992, respondent filed
a complaint for damages against petitioner Airline.
Petitioner’s Argument/s:
Petitioner moved to dismiss the complaint invoking the
provisions of Article 29 of the Warsaw Convention. (LOST)
Respondent’s Arguments:
Respondent countered that according to par. 2 of Article
29, “the method of calculating the period of limitation shall
be determined by the law of the court to which the case is
submitted.” (WON)
Ruling of the lower court:
The trial court ordered the dismissal of the action holding
that the language of Art. 29 is clear that the action must
be brought within two (2) years from the date of arrival at
the destination. It held that although the second
paragraph of Art. 29 speaks of deference to the law of the
local court in "calculating the period of limitation," the
same does not refer to the local forum's rules in
interrupting the prescriptive period but only to the rules of
determining the time in which the action may be deemed
commenced, and within our jurisdiction the action shall be
deemed "brought" or commenced by the filing of a
complaint. Hence, the trial court concluded that Art. 29
excludes the application of our interruption rules.
Issue:
1. Does the Warsaw Convention preclude the operation of
the Civil Code and other pertinent laws? NO
2. Has the respondent’s cause of action prescribed? NO
Rule:
Article 29 of Warsaw Convention.
1. The right to damages shall be extinguished if an
action is not brought within two years, reckoned
from the date of arrival at the destination, or from
the date on which the aircraft ought to have arrived,
or from the date on which the carriage stopped.
2. The method of calculating the period of limitation shall
be determined by the law of the Court seized of the case
Application:
1. Within our jurisdiction we have held that the
Warsaw Convention can be applied, or ignored,
depending on the peculiar facts presented by
each case. Convention provisions do not regulate
or exclude liabilities for other breaches of contract
by the carrier or misconduct of its officers and
 employees, or for some particular or exceptional
type of damage. Neither may the Convention be
invoked to justify the disregard of some
extraordinary type of damage. Neither may the
Convention be invoked to justify the disregard of
some extraordinary sort of damage resulting to a
passenger and preclude recovery therefore3
beyond the limits set by said convention.
Likewise, we have held that the Convention does
not preclude the operation of the Civil Code and
other pertinent laws. It does not regulate, much
less exempt, the carrier from liability for damages
for violating the rights of its passengers under the
contract of carriage, especially if willful
misconduct on the part of the carrier's employees
is found or established.
2. While his 2nd cause of action (an action for
damages arising from theft or damage to
property or goods) is well within the bounds of
the Warsaw convention, his 1st cause of action
(an action for damages arising from the
misconduct of the airline employees and the
violation of respondent’s rights as passengers)
clearly is not.
The 2-yr limitation incorporated in Art. 29 of the
Warsaw Convention as an absolute bar to suit and
not to be made subject to the various tolling
provisions of the laws of the forum, forecloses the
application of our own rules on interruption of
prescriptive periods. (Art. 29, par. 2 was intended
only to let local laws determine whether an action
shall be deemed commenced upon the filing of a
complaint.) Since, it is indisputable that
respondent filed the present action beyond the 2-
yr time frame his 2nd cause of action must be
barred.
However, it is obvious that respondent was
forestalled from immediately filing an action
because petitioner gave him the runaround,
answering his letters but not giving in to his
demands. True, respondent should have already
filed an action at the first instance when petitioner
denied his claims but the same could only be due
to his desire to make an out-of-court settlement
for which he cannot be faulted. Hence, despite
the express mandate of Article 29 of the Warsaw
Convention that an action for damages should be
filed within 2 years from the arrival at the place
of destination, such rule shall not be applied in
the instant case because of the delaying tactics
employed by petitioner airlines itself. Thus,
respondent’s 2nd cause of action cannot be
considered as time barred.
Gross Negligence/Discourtesy
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Sabena Belgian World Airlines v. Hon. Court of
Appeals
G.R. No. | Date
Facts:
● Private respondent Ma. Paula San Agustin was a
passenger on board Flight SN 284 the airline
originating from Casablanca to Brussels, Belgium
on her way back to Manila. She checked in her
luggage which contained her valuables all
amounting to $4,265.00, for which she was
issued Tag No. 71423. She stayed overnight in
Brussels and her luggage was left on board Flight
SN 284. Upon Arrival in Manila, she learned that
her luggage was missing and was advised to
accomplish and submit a property Irregularity
Report which she submitted and filed on the same
day.
● Upon follow up, it remained missing; thus, she
filed her formal complaint with the office of Ferge
Massed, petitioner’s Local Manager, demanding
immediate attention.
● Two weeks later she was notified that her luggage
was found. But unfortunately, she was informed
that the luggage was lost for the second time. She
demanded payment but the airline refused to
settle the claim.
Petitioner’s Argument/s:
● Private respondent was negligent and should be
considered the primary cause for the loss of her
luggage. Despite her awareness that the flight
ticket had been confirmed only for Casablanca
and Brussels, and that her flight from Brussels to
Manila had yet to be confirmed, she did not
retrieve the luggage upon arrival in Brussels.
● Being a seasoned international traveler,
respondent must have likewise been familiar with
the standard provisions contained in her flight
ticket that items of value are required to be hand-
carried by the passenger and that the liability of
the airline or loss, delay or damage to baggage
would be limited, in any event, to only US$20.00
per kilo unless a higher value is declared in
advance and corresponding additional charges
are paid thereon.
● At the Casablanca International Airport, private
respondent, in checking in her luggage, evidently
did not declare its contents or value. Petitioner
cites Section 5(c), Article IX, of the General
Conditions of Carriage, signed at Warsaw, Poland,
on 02 October 1929, as amended by the Hague
Protocol of 1955, generally observed by
International carriers, stating, among other
things, that:
“Passengers shall not include in his checked baggage, and
the carrier may refuse to carry as checked baggage, fragile
or perishable articles, money, jewelry, precious metals,
negotiable papers, securities or other valuables.”
Respondent’s Arguments:
Case did not discuss private respondent’s arguments
Ruling of the lower court:
● The trial court ruled in favor of Ma. Paula San
Agustin.
● The appellate court affirmed in toto the trial
court’s judgment.
Issue: WON loss of baggage twice shows gross negligence
Rule:
● Fault or negligence consists in the omission of
that diligence which is demanded by the nature
of an obligation and corresponds with the
circumstances of the person, of the time, and of
the place. When the source of an obligation is
derived from a contract, the mere breach or non-
fulfillment of the prestation gives rise to the
presumption of fault on the part of the obligor.
This rule is not different in the case of common
carriers in the carriage of goods which, indeed,
are bound to observe not just the due diligence
of a good father of a family but that of
“extraordinary” care in the vigilance over the
goods.
● The Warsaw Convention denies to the carrier
availment ‘of the provisions which exclude or limit
his liability, if the damage is caused by his willful
misconduct or by such default on his part as, in
accordance with the law of the court seized of the
case, is considered to be equivalent to willful
misconduct,’ or ‘if the damage is (similarly)
caused x x x by any agent of the carrier acting
within the scope of his employment.
Application:
● It remained undisputed that San Agustin’s
luggage was lost while it was in the custody of
Sabena Belgian World Airlines. It was supposed
to arrive on the same flight that San Agustin took
in returning to Manila on 2 September 1987. On
23 October 1987, she was advised that her
luggage had finally been found, with its contents
intact; only to be told later that her luggage had
been lost for the second time. Thus, Sabena
Belgian World Airlines is ultimately guilty of
“gross negligence” in the handling of San
Agustin’s luggage, for the “loss of said baggage
not only once by twice underscore the wanton
negligence and lack of care “ on the part of the
carrier.
● The airline cannot invoke the tort doctrine of
proximate cause because the private
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respondent’s luggage was lost while it was in the
custody of petitioner. The “loss of said baggage
not only once but twice,” said the appellate court,
“underscores the wanton negligence and lack of
care” on the part of the carrier. The above
findings foreclose whatever rights petitioner
might have had to the possible limitation of
liabilities enjoyed by international air carriers
under the Warsaw Convention.
● The Warsaw Convention does not operate as an
exclusive enumeration of the instances of an
airline’s liability, or as an absolute limit of the
extent of that liability. It should be deemed a limit
of liability only in those cases where the cause of
the death or injury to person, or destruction, loss
or damage to property or delay in its transport is
not attributable to or attended by any willful
misconduct, bad faith, recklessness or otherwise
improper conduct on the part of any official or
employee for which the carrier is responsible, and
there is otherwise no special or extraordinary
form of resulting injury.
Philippine Airlines, Inc. v. Court of Appeals
G.R. No. 119641 | May 17, 1996
Facts:
● This is an appeal by certiorari filed by PAL
assailing the decision of the CA and RTC holding
them liable to private respondents Dr. Josefino
and Luisa Miranda (Mirandas) for moral damages
(100,000), Exemplary damages (P30,000) and
Attorney’s Fees (P10,000).
● The Mirandas, who were residents of Surigao
City, went to the US on a regular flight of PAL.
After a month’s stay, they obtained confirmed
bookings from PAL’s San Francisco office for PAL
Flight PR101 from San Francisco to Manila via
Honolulu on June 21, 1988, PAL Flight PR851
from Manila to Cebu on June 24, 1988 and PAL
Flight PR 905 from Cebu to Surigao on the same
date.
● When they boarded the flight in San Francisco
along with their five (5) pieces of luggage, and
upon arrival in Manila, they were told by the PAL
personnel that their baggage consisting of two
balikbayan boxes, two pieces of luggage and one
fishing rod case were off-loaded at Honolulu due
to weight limitations. This caused the Mirandas to
miss their flight from Manila to Cebu and Cebu to
Surigao since they had to wait for their baggage,
which arrived on June 24, 1988 after their pre-
scheduled flight had left.
● They departed for Cebu the following day and on
their way to Surigao, the pilot announced that
they had to return to Mactan Airport due to some
mechanical problem.
 ● While at the airport, the passengers were
provided by PAL with lunch and were booked for
the afternoon flight to Surigao City, but that flight
was also cancelled.
● Since there were no other flights that day, the
Mirandas asked to be billeted at the Cebu Plaza
Hotel (Now Marco Polo) where they usually stay
whenever they happen to be in Cebu. However,
the PAL employees said that it was not possible
as it was fully booked. This was contrary to what
the Mirandas claimed when the said hotel told
them that they can be accommodated. PAL
eventually agreed for an overnight stay at the
hotel.
● PAL Duty Manager (Oscar Jereza) approved the
hotel authority with standard meals after the
Mirandas insistence that their meals be ordered a
la carte provided they sign for the orders.
● PAL gave them P150.00 as fare for the return trip
to the airport. The Mirandas asked for P150.00
more as it would take two taxis to accommodate
them and their luggage and for hotel tips. This
was refused by PAL. Dr. Miranda then declared
that he would forego the amenities offered by PAL
which later caused for the P150 voucher and hotel
accommodation’s cancellation because of Dr.
Miranda’s decision.
● When the Mirandas tried to retrieve their
baggage, they were told this time that the same
were loaded on another earlier PAL flight to
Surigao City. The Mirandas proceeded to the hotel
without their baggage until their flight on June 26,
1988.
● Thereafter, they instituted an action for damages
which the RTC and CA granted in their favor.
Petitioner’s Arguments: PAL (LOST)
● They should not be held liable for violation of Art.
2220, 2232 and 2208 of the Civil Code on the
award for moral and exemplary damages and
attorney’s fees since there was absence of bad
faith on its part.
● Petitioner enumerates the following incidents as
indicative of its good faith in dealing with private
respondents:
○ The cancellation of the flight to Surigao
City due to mechanical/engine trouble
was to ensure the safety of passengers
and cargo;
○ PAL offered to shoulder private
respondents' preferred
accommodations, meals and
transportation while in Cebu City with
more than the usual amenities given in
cases of flight disruption, and gave
them priority in the following day's flight
to Surigao City;
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○ PAL employees did not act rudely
towards private respondents and its
managerial personnel even gave them
special attention;
○ It was reasonable for PAL to limit the
transportation expense to P150.00,
considering that the fare between the
airport and the hotel was only P75.00,
and they would be picked up by the
shuttle bus from the hotel to the airport,
while the request for money for tips
could not be justified; and
○ The inadvertent loading of private
respondents' baggage on the
replacement flight to Surigao City was at
most simple and excusable negligence
due to the numerous flight disruptions
and large number of baggages on that
day.
● They further alleged that the contract of carriage
of the Warsaw Convention only limits their
liability to USD20 per kilo of baggage but the
courts failed to apply these.
Respondent’s Arguments: CA, SPS MIRANDA (WON)
● It cannot be denied that the Mirandas had to
undergo some personal inconveniences in Manila
for lack of their baggage. It is also highly probable
that their scheduled return to Surigao City was
upset because of their having to wait for one day
for their missing things. Consequently, it was
quite evident that the off-loading of their baggage
in Honolulu was the proximate cause of their
subsequent inconveniences for which they
claimed to have suffered social humiliation,
wounded feelings, frustration and mental
anguish.
● There was a breach of contract committed in bad
faith by PAL. As previously noted, plaintiffs had a
confirmed booking on PAL Flight PR 101 from San
Francisco to Manila. Therefore they were entitled
to an assured passage not only for themselves
but for their baggage as well. They had a legal
right to rely on this.
● The evidence showed that their baggages were
properly loaded and stowed in the plane when it
left San Francisco for Honolulu. The off-loading or
bumping off by PAL of their baggage to give way
to other passengers or cargo was an arbitrary and
oppressive act which clearly amounted to a
breach of contract committed in bad faith and
with malice. This was affirmed by Edgar
Mondejar, PAL’s baggage service representative.
Ruling of the lower court:
● RTC Findings: There was poor treatment of the
Mirandas by the PAL employees during the
stopover at Mactan Airport; the cavalier and
 dubious response of petitioner's personnel to the
Miranda spouses' request to be billeted at the
Cebu Plaza Hotel by denying the same allegedly
because it was fully booked, which claim was
belied by the fact that Dr. Miranda was easily able
to arrange for accommodations thereat; and, the
PAL employees' negligent, almost malicious, act
of sending off the baggage of private respondents
to Surigao City, while they were still in Cebu,
without any explanation for this gross oversight.
● CA affirmed the RTC decision.
Issue:
● WON the factual findings of the lower court and
CA provide sufficient proof that PAL acted with
malice and in bad faith thereby making them
liable for the claim of damages by the
respondents. YES.
Rule:
● A contract of air carriage generates a relation
attended with a public duty and any discourteous
conduct on the part of a carrier's employee
toward a passenger gives the latter an action for
damages and, more so, where there is bad faith.
● Although the Warsaw Convention has the force
and effect of law in this country, being a treaty
commitment assumed by the Philippine
government, said convention does not operate as
an exclusive enumeration of the instances for
declaring a carrier liable for breach of contract of
carriage or as an absolute limit of the extent of
that liability. The Warsaw Convention declares
the carrier liable in the enumerated cases and
under certain limitations. However, it must not be
construed to preclude the operation of the Civil
Code and pertinent laws. It does not regulate,
much less exempt, the carrier from liability for
damages for violating the rights of its passengers
under the contract of carriage, especially if willful
misconduct on the part of the carrier's employees
is found or established.
● It is now firmly settled that moral damages are
recoverable in suits predicated on breach of a
contract of carriage where it is proved that the
carrier was guilty of fraud or bad faith.
● It must, of course, be borne in mind that moral
damages are not awarded to penalize the
defendant but to compensate the plaintiff for the
injuries he may have suffered. 18 In a contractual
or quasi-contractual relationship, exemplary
damages, on the other hand, may be awarded
only if the defendant had acted in a wanton,
fraudulent, reckless, oppressive or malevolent
manner. Attorney's fees in the concept of
damages may be awarded where there is a
finding of bad faith.
Application:
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● The testimony of Mondejar constituted a clear
admission in PAL's evidence of facts amounting to
a breach of contract in bad faith when preference
was given to cargoes newly loaded at Honolulu
instead of the cargoes already from mainland
USA. This being so, PAL must be held liable in
damages for the consequences of its action.
● The off-loading of the spouses’' baggage was
done in bad faith because it was not really for the
purpose of complying with weight limitations but
to give undue preference to newly-loaded
baggage in Honolulu. This was followed by
another mishandling of said baggage in the twice-
cancelled connecting flight from Cebu to Surigao.
The Mirandas’ sad experience was further
aggravated by the misconduct of PAL's personnel
in Cebu, who lied to appellees in denying their
request to be billeted at Cebu Plaza Hotel.
● Inattention to and lack of care for the interests of
its passengers who are entitled to its utmost
consideration, particularly as to their
convenience, amount to bad faith which entitles
the passenger to an award of moral damages.
What the law considers as bad faith which may
furnish the ground for an award of moral
damages would be bad faith in securing the
contract and in the execution thereof, as well as
in the enforcement of its terms, or any other kind
of deceit. 16 Such unprofessional and proscribed
conduct is attributable to petitioner airline in the
case at bar and the adverse doctrinal rule is
accordingly applicable to it.
● The evidence on record amply sustains that the
awards assessed against PAL on the aforestated
items of damages are justified and reasonable.
● At this juncture, it may also be pointed out that it
is PAL's duty to provide assistance to private
respondents and, for that matter, any other
passenger similarly inconvenienced due to delay
in the completion of the transport and the receipt
of their baggage. Therefore, its unilateral and
voluntary act of providing cash assistance is
deemed part of its obligation as an air carrier, and
is hardly anything to rave about. Likewise,
arrangements for and verification of requested
hotel accommodations for the Mirandas could and
should have been done by PAL employees
themselves, and not by Dr. Mranda.
● While it may be true that there was no direct
evidence on record of blatant rudeness on the
part of PAL employees towards the Mirandas, the
fact that private respondents were practically
compelled to haggle for accommodations, a
situation unbefitting persons of their stature, is
rather demeaning and it partakes of discourtesy
magnified by PAL's condescending attitude.
Moreover, it cannot be denied that the PAL
employees herein concerned were definitely less
 than candid, to put it mildly, when they withheld
information from private respondents that they
could actually be accommodated in a hotel of
their choice.
● The request of private respondents for monetary
assistance of P300.00 for taxi fare was indeed
justified, considering that there were two of them
and they had several pieces of luggage which had
to be ferried between the airport and the hotel.
Also, the request for a small additional sum for
tips is equally reasonable since tipping, especially
in a first-rate hotel, is an accepted practice, of
which the Court can take judicial notice. This is
aside from the fact that private respondents,
having just arrived from an extended trip abroad,
had already run out of Philippine currency, which
predicament was exacerbated by their additional
stay in Manila due to the off-loading of their
baggage. All these inconveniences should have
warranted a commonsensical and more
understanding treatment from PAL, considering
that private respondents found themselves in this
unpleasant situation through no fault of theirs.
On PAL”s argument that their liability is only limited to the
stipulation on the Warsaw Convention:
● The Mirandas did not seek payment for loss of any
baggage. They are claiming damages arising from
the discriminatory off-loading of their baggage.
That cannot be limited by the printed conditions
in the tickets and baggage checks. Neither can
the Warsaw Convention exclude nor regulate the
liability for other breaches of contract by air
carriers. A recognition of the Warsaw Convention
does not preclude the operation of our Civil Code
and related laws in determining the extent of
liability of common carriers in breach of contract
of carriage, particularly for willful misconduct of
their employees.
● The congruent finding of both the trial court and
respondent court that there was discriminatory
off-loading being a factual question is, as stated
earlier, binding upon and can no longer be passed
upon by this Court, especially in view of and in
deference to the affirmance of the same by
respondent appellate court.
Philippine Airlines, Inc. v. CA
G.R. No. 123238 | September 22, 2008
Facts: (Case was also assigned under module 6 -
damages) Private respondents (Sps. Bunico) bought two
tickets for their minor children to travel to the US as
“unaccompanied minors”. They would travel from MNL-
SAN FRANCISCO and board another flight for LOS
ANGELES and they would be fetched by their grandmother.
An indemnity bond was required by petitioner (PAL) from
the spouses because it was a requisite for this particular
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kind of travel arrangement. When the minors arrived at
SF, upon boarding for their connecting flight to LA, they
were not allowed to board because of the failure by PAL’s
staff to produce the indemnity bond. The minors stayed
overnight with a personnel of PAL and were sent to LA in
another flight the following day. The spouses filed a civil
case for damages.
Petitioner’s Argument/s (LOST): Petitioner also claims
that it cannot be entirely blamed for the loss of the
indemnity bond; that during the stop-over of Flight 106 in
Hawaii it gave the indemnity bond to the immigration office
therein as a matter of procedure; that the indemnity bond
was in the custody of the said immigration officer when
they left; that the said immigration officer failed to return
the indemnity bond to petitioner's personnel.
Respondent’s Arguments (SPOUSES - WON): Private
respondents alleged that Deanna and Nikolai were not able
to take their connecting flight from San Francisco to Los
Angeles as scheduled because the required indemnity
bond was lost on account of the gross negligence and
malevolent conduct of petitioner's personnel.
Ruling of the lower court: RTC and CA both found
petitioner liable for damages for their inattention and lack
of care for the welfare of the minors amounted to bad faith.
Issue: WON petitioners were guilty of bad faith. (YES)
Rule: When an airline issues a ticket to a passenger,
confirmed for a particular flight on a certain date, a
contract of carriage arises. If the passenger is not so
transported or if in the process of transporting, he dies or
is injured, the carrier may be held liable for a breach of
contract of carriage. In breach of contract of air carriage,
moral damages may be recovered where (1) the mishap
results in the death of a passenger; or (2) where the
carrier is guilty of fraud or bad faith; or (3) where the
negligence of the carrier is so gross and reckless as to
virtually amount to bad faith.
Gross negligence implies a want or absence of or failure to
exercise even slight care or diligence, or the entire
absence of care. It evinces a thoughtless disregard of
consequences without exerting any effort to avoid them.
Application: Petitioner also knew well that the indemnity
bond was required for the minors to make a connecting
flight from San Francisco to Los Angeles, and that it was
its duty to produce the indemnity bond to the staff of
United Airways 996 (connecting airline) so that the minors
could board the connecting flight. Yet, despite knowledge
of the foregoing, it did not exercise utmost care in handling
the indemnity bond resulting in its loss in Hawaii.
Petitioner's failure to exercise even slight care and
diligence in handling the indemnity bond. The negligence
of petitioner was so gross and reckless that it amounted to
bad faith. Petitioner's claim that it cannot be entirely
blamed for the loss of the indemnity bond because it gave
the indemnity bond to the immigration office of Honolulu,
Hawaii, as a matter of procedure during the stop-over, and
the officer failed to return the indemnity bond to
petitioner's personnel. It was the petitioner's obligation to
ensure that it had the indemnity bond in its custody before
leaving Honolulu, Hawaii for San Francisco.
Philippine Airlines, Inc. v. Lopez, Jr.,
G.R. No. 156654| November 20, 2008
Facts:
Lopez filed a complaint against PAL and claimed that the
latter had unjustifiably downgraded his seat from business
to economy class in his return flight from Bangkok to
Manila, and that, in view thereof, PAL should be directed
to pay him moral damages, exemplary damages,
attorney's fees, as well as the costs of suit.
Petitioner’s Argument/s: WON
He purchased a Manila-Hongkong-Bangkok-Manila PAL
business class ticket and that his return flight to Manila
was confirmed by PAL's booking personnel in Bangkok. He
also mentioned that he was surprised to learn during his
check-in for the said return flight that his status as
business class passenger was changed to economy class,
and that PAL was not able to offer any valid explanation
for the sudden change when he protested the change. He
added that although aggrieved, he nevertheless took the
said flight as an economy class passenger because he had
important appointments in Manila.
Respondent’s Arguments: LOST
PAL denied any liability and claimed that whatever damage
Lopez had suffered was due to his own fault. The terms
and conditions of the contract of carriage required Lopez
to reconfirm his booking for the Bangkok-to-Manila leg of
his trip, and that he did not protest the economy seat given
to him when the change in his accommodations was read
to him by the person who received his phone
reconfirmation. Lopez did not complain against his
economy seat during the check-in and that he raised the
issue only after the flight was over. Thus, PAL prayed that
the case be dismissed for lack of merit.
Ruling of the lower court:
RTC held PAL liable for damages. It said that PAL's
contention that Lopez might have thought that he was
holding an economy class ticket or that he waived his right
to have a business class seat is untenable, considering that
Lopez is an experienced businessman and a Bachelor of
Science degree holder.
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It also noted that the following showed that PAL's
employees had been negligent in booking and
confirming Lopez's travel accommodations from
Bangkok to Manila: (1) the admission of PAL's booking
personnel that she affixed the validation sticker on Lopez's
ticket on the basis of the passenger's name list showing
that his reservation was for an economy class seat without
examining or checking the latter's ticket during his booking
validation; and (2) the admission of PAL's check-in clerk
at the Bangkok Airport that when Lopez checked-in for his
return trip to Manila, she similarly gave Lopez an economy
boarding pass based on the information found in the
coupon of the ticket and the passenger manifest without
checking the latter's ticket. PAL's employees examined his
ticket in those instances, the error or oversight which
might have resulted from the phoned-in booking could
have been easily rectified.
Thus, citing Articles 1733 and 2220 of the Civil Code and
the case of Ortigas, Jr. v. Lufthansa German Airlines,RTC
held that the inattention and lack of care on the part
of the common carrier, in this case PAL, resulting in
the failure of the passenger to be accommodated in
the class contracted for amounts to bad faith or
fraud, making it liable for damages. It likewise
awarded attorney's fees in favor of Lopez after noting that
Lopez was forced to litigate in order to assert his rights.
On appeal, the CA affirmed in toto RTC’s decision after
having been fully convinced of the negligence of PAL's
employees and after finding PAL's defenses to be unworthy
of belief and contrary to common observation and
experience.
Issue:
(1) Did the Court of Appeals err in not ruling that Lopez
agreed or allowed his business class seat to be
downgraded to economy class?
(2) Did the Court of Appeals err in not ruling that Lopez's
alleged contributory negligence was the proximate cause
of the downgrading of his seat? and
(3) Did the Court of Appeals err in awarding moral
damages, exemplary damages and attorney's fees in favor
of Lopez in view of the alleged absence of fraud or bad
faith of PAL?
Rule:
Articles 1733 and 2220 of the Civil Code
Ortigas, Jr. v. Lufthansa German Airlines- inattention and
lack of care on the part of the common carrier, in this case
PAL, resulting in the failure of the passenger to be
accommodated in the class contracted for amounts to bad
faith or fraud, making it liable for damages.
Application:
A perusal of the aforesaid issues readily shows that the
same are questions of facts since its resolution would
entail a re-evaluation of the evidence presented before the
trial court. Thus, we could not take cognizance of such
issues considering the settled rule that our review under
Rule 45 is confined to questions of law. The issues on the
existence of negligence, fraud and bad faith are questions
of fact.
SC had also observed that PAL is also guilty of raising
prohibited new matters and in changing its theory of
defense since it is only in the present petition that it
alleged the contributory negligence of Lopez.
PAL's procedural lapses notwithstanding, SC had
nevertheless carefully reviewed the records of this case
and found no compelling reason to depart from the uniform
factual findings of the trial court and the Court of Appeals
that: (1) it was the negligence of PAL which caused the
downgrading of the seat of Lopez; and (2) the aforesaid
negligence of PAL amounted to fraud or bad faith,
considering our ruling in Ortigas.
Moreover, SC did not agree with PAL that the amount of
moral damages awarded by the trial court, as affirmed by
the CA, was excessive. In Mercury Drug Corporation v.
Baking, it was stated that "there is no hard-and-fast rule
in determining what would be a fair and reasonable
amount of moral damages, since each case must be
governed by its own peculiar facts. However, it must be
commensurate to the loss or injury suffered."
Taking into account the attending circumstances here, the
amount of P100, 000 awarded as moral damages is
appropriate.
Contract of Carriage/Nominal Damages
Alitalia v. IAC, et al.
G.R. No. | Date
Facts: Dr. Felipa Pablo, an associate Professor of UP and
a research grantee, was invited to take part at a meeting
of the Department of Research and Isotopes of the Joint
FAO-IAEA Division of Atomic Energy in Food and
Agriculture of the UN in Italy.
She accepted the invitation and was then scheduled to
read a research paper. She arrived in Milan on the day
before the meeting but was told by the ALITALIA personnel
that her luggage was “delayed inasmuch as the same in
one of the succeeding flights from Rome to Milan. Her
luggages consisted of her personal belongings and
research materials.
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Feeling desperate, she went to Rome to try to locate her
bags herself. However, her baggage could not be found.
She then returned to Manila without attending the meeting
in Italy.
She demanded that ALITALIA make reparation for the
damages suffered by her.
As it turned out, Dr. Pablo’s suitcases were in fact located
and forwarded to Italy but only on the day after her
scheduled appearance and participation at the UN
meeting. And for some reason, the suitcases were restored
to Prof Pablo 11 months later.
Petitioner’s Argument/s: not clearly stated but Dr. Pablo
WON in this case
Respondent’s Arguments: Warsaw Convention should
have been applied to limit ALITALIA’s liability and that
there is no warrant in fact and in law for the award to Dr.
Pablo of nominal damages and Attorney’s fees.
Issue:
1. WON Warsaw Convention should be applied to limit
ALITALIA’s liability (NO)
2. WON the award of nominal damages and Attorney’s
fees is proper (YES)
Rule:
Under the Warsaw Convention, an airline carrier is made
liable for damages for:
(1) The death, wounding or other bodily injury of a
passenger if the accident causing it took place on board
the aircraft or in the course of its operations of embarking
or disembarking
(2) The destruction or loss of, or damage to, any
registered luggage or goods, if the occurrence causing it
took place during the carriage by air
(3) Delay in the transportation by air of passengers,
luggage or goods.
The convention also purports to limit the liability of carriers
in the carriage of passengers and carriage of registered
baggage and cargo where in the case of loss, damage or
delay of part of registered baggage or cargo, or any object
contained therein, the weight to be taken into
consideration in determining the amount to which the
carrier’s liability is limited shall be only the total weight of
the packages concerned.
The Warsaw Convention however denies to the carrier
availment of the provision which exclude or limit his
liability, if the damage is caused by his willful misconduct
or by such default on his part.
Application:
(1) In the case at bar, no bad faith or improper conduct
may be ascribed to the employees of the petitioner airline,
and Dr. Pablo’s luggage was eventually returned to her,
belatedly, but without appreciable damage. Nevertheless,
some special specie of injury was caused to Dr. Pablo
because petitioner ALITALIA misplaced her baggage and
failed to deliver to her at the time appointed, which is a
breach of its contract of carriage. Because of this, Dr. Pablo
was not able to read and present the paper that she had
painstakingly labored. The opportunity to claim this honor
or distinction was irretrievably lost to her due to
ALITALIA’s breach of its contract. The compensation for
the injury suffered by Dr. Pablo cannot be restricted to that
prescribed by the Warsaw Convention.
(2) Dr. Pablo is entitled to nominal damages, which, as
the law says, is adjudicated in order that a right of the
plaintiff, which has been violated or invaded by defendant,
may be vindicated and recognized. The award of attorney’s
fees is also reasonable in the premises.
Savellano, et al. v. Northwest Airlines
G.R. No. | Date
Facts:
Petitioners herein were passengers of the respondent. The
petitioners were bound for Manila from San Francisco USA.
The contract of carriage entered into by the petitioner and
respondent was for San Francisco-Tokyo (Narita)- Manila
flights. Due to an engine malfunction, the plane in which
the petitioners were on board made an emergency landing
in Seattle. The petitioners, together with the other
passengers, were brought to a hotel sponsored by the
respondent. Petitioners, thereafter, received a phone call
from the respondent’s personnel advising them to be at
the Seattle Airport by 7AM for departure. Before leaving
the hotel, petitioners met a co passenger who informed
them that he and some passengers were leaving the next
day on board the same plane with the same itinerary.
Petitioners experienced inconveniences in that their
original itinerary was not followed and some of their valued
belongings were lost during the transit. This prompted this
petition for moral damages and claims for the lost items
against the respondent.
Petitioner’s Argument/s: LOST
That they were excluded from the Seattle-Tokyo-Manila
flight to accommodate several Japanese passengers bound
for Japan. And as basis of its award of actual damages
arising from the allegedly lost articles contained in the
would-have-been hand carried luggage
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Respondent’s Arguments:——
Ruling of the lower court:
The CA ruled that the petitioners were not able to show
the respondent's bad faith, negligence, or malice in
transporting them via Seattle—LA— Seoul — Manila route.
Hence, there’s no basis for the claim for moral and
exemplary damages.
Issue:
WON the petitioners’ discriminatory bump off constitutes
breach by the respondent of its air carriage contract
WON petitioners are entitled to actual, moral, and
exemplary damages?
Rule:
Art. 1170. Those who in the performance of their
obligations are guilty of fraud, negligence, or delay and
those who in any manner contravene the tenor thereof are
liable for damages." (Italics supplied)
"Art. 2201. In contracts and quasi-contracts, the damages
for which the obligor who acted in good faith is liable shall
be those that are the natural and probable consequences
of the breach of the obligation, and which the parties have
foreseen or could have reasonably foreseen at the time the
obligation was constituted."
"In case of fraud, bad faith, malice or wanton attitude, the
obligor shall be responsible for all damages which may be
reasonably attributed to the nonperformance of the
obligation."
Art. 2221. Nominal damages are adjudicated in order that
a right of the plaintiff, which has been violated or invaded
by the defendant, may be vindicated or recognized, and
not for the purpose of indemnifying the plaintiff for any
loss suffered by him."
"Art. 2222. The court may award nominal damages in
every obligation arising from any source enumerated in
Article 1157, or in every case where any property right has
been invaded."
in Lopez despite sufficient time — one month — to inform
the passengers of what had happened to their booking, the
airline agent intentionally withheld that information from
them. In Zulueta, the passenger was deliberately off-
loaded after being gravely insulted during an altercation.
And in Ortigas, the passenger was intentionally
downgraded in favor of a European.
Application:
Yes, respondent breached its contract of carriage with the
petitioner. Despite the conditions printed on the airline
ticket, allowing the respondent to substitute alternative
carriers or aircraft without notice to the passengers,
nothing there permits shuttling passengers — without so
much as a by your-leave — to stopping places that they
have not been previously noticed of, much less agreed to
or been prepared for. Substituting aircrafts or carriers
without notice is entirely different from changing stopping
places or connecting cities without notice.
The ambiguities of a contract adhesion, must be construed
against the party that caused its preparation which in this
case is the respondent.
PROOF OF NECESSITY OF ALTERATION
There was at first a necessity caused by the engine
malfunction. However, the necessity invoked by the
respondent ceased to exist the moment the aircraft made
an emergency landing in Seattle. Northwest failed to show
a "case of necessity" for changing the stopping place from
Tokyo to Los Angeles and Seoul. It is a fact that some of
the passengers on the distressed flight continued on to the
Tokyo (Narita) connecting place. No explanation was made
as to why they were not similarly allowed to board the
same plane with the same itinerary. The court stated that
there could be other carriers which can accommodate the
petitioners and whose route is more preferable than the
more circuitous one unilaterally chosen for them by
respondent. ABSENCE OF EVIDENCE AS TO THE ACTUAL
SITUATION the court holds the respondent liable for
breach of contract.
CLAIMS for DAMAGES
The claims for damages that the petitioners herein want to
claim cannot be awarded as there is no showing of bad
faith, entrepreneurial motive or self-interest, and or
malice. Just like in the cases cited by the petitioner. Bad
faith, malice being absent, actual, moral, and exemplary
damages cannot be awarded. However, the petitioners are
not left without recourse. They can still be awarded with
nominal damages. Nominal damages are recoverable if no
actual, substantial or specific damages were shown to
have resulted from the breach.
CLAIMS FOR THE LOST ITEMS
Petitioners were not able to present a written complaint
within the period prescribed by law. It being such, no claim
can be heard or admitted against the respondent.
Presence of Bad Faith
Air France v. Bonifacio H. Gillego, substituted by his
surviving heirs represented by Dolores P. Gillego
G.R. No. 165266 | December 15, 2010
Facts:
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● Respondent Gillego, then incumbent Congressman of
Sorsogon, went on board petitioner Air France’s flight
bound for Paris to participate as one of the keynote
speakers at an international symposium for human
rights.
● He arrived at De Gaulle International Airport (Paris) at
5am, and while waiting for his connecting flight to
Budapest scheduled at 3:15pm, he learned that
petitioner had an earlier departure to Budapest at
10am. He then went to the counter to make
arrangements, and was given a corresponding ticket,
boarding pass, and a new baggage claim stub for his
checked-in luggage.
● However, upon arriving in Budapest, respondent was
unable to locate his luggage at the claiming section.
He sought assistance from petitioners, and they
advised him to just wait for his luggage at his hotel as
their representative would take charge of delivering
the same to him that same day.
● Despite several follow-up inquiries, the luggage was
never delivered.
● Upon respondent’s return to PH, his lawyer
immediately wrote petitioner’s station manager
complaining about the lost luggage and the resulting
damages his client suffered while in Budapest.
● Thereafter, respondent filed a complaint for damages.
Petitioner’s Arguments: (LOST)
Petitioner averred that it has taken all necessary measures
to avoid loss of respondents baggage, the contents of
which respondent did not declare, and that it has no intent
to cause such loss, much less knew that such loss could
occur. The loss of respondent’s luggage is due to or
occasioned by force majeure or fortuitous event or other
causes beyond the carriers control. Diligent, sincere and
timely efforts were exerted by petitioner to locate
respondents missing luggage and attended to his problem
with utmost courtesy, concern and dispatch.
Petitioner further asserted that it exercised due diligence
in the selection and supervision of its employees, and that
respondent’s claim for damages had no basis in fact and in
law.
Respondent’s Arguments: (WON)
Respondent alleged that by reason of Air France’s
negligence and breach of obligation to transport and
deliver his luggage, respondent suffered inconvenience,
serious anxiety, physical suffering and sleepless nights. It
was further alleged that due to the physical, mental and
emotional strain resulting from the loss of his luggage,
aggravated by the fact that he failed to take his regular
medication, respondent had to be taken to a medical clinic
in Tokyo, Japan for emergency treatment.
Ruling of the lower court:
● The trial court found that there was gross negligence
on the part of petitioner which failed to retrieve
 respondent’s checked-in luggage up to the time of the
filing of the complaint and as admitted in its answer,
ignored respondents repeated follow-ups. It likewise
found petitioner guilty of willful misconduct as it
persistently disregarded the rights of respondent who
was no ordinary individual but a high government
official.
● CA noted that in the memorandum submitted by Air
France before the trial court, it was mentioned that
the luggage was eventually found and delivered to
him; hence, the claim for actual damages was
withdrawn. As to the moral and exemplary damages,
the CA sustained trial court’s decision.
Issue:
Whether there was gross negligence on Air France’s part
to warrant the award of moral damages. (Yes)
Rule:
Not every case of mental anguish, fright or serious anxiety
calls for the award of moral damages. In awarding moral
damages for breach of contract of carriage, the breach
must be wanton and deliberately injurious or the one
responsible acted fraudulently or with malice or bad
faith.
Application:
The trial and appellate courts did not err in finding that
petitioner acted in bad faith in repeatedly ignoring
respondent’s follow-up calls.
It cannot accept the convenient excuse given by petitioner
that respondent should be faulted in allegedly not giving
his hotel address and telephone number. It is difficult to
believe that respondent, who had just lost his single
luggage containing all his necessities for his stay in a
foreign land and his reference materials for a speaking
engagement, would not give an information so vital such
as his hotel address and contact number to the airline
counter where he had promptly and frantically filed his
complaint. Although the missing luggage was eventually
recovered, it was returned to respondent only after the
trial of this case.
While respondent failed to cite any act of discourtesy,
discrimination or rudeness by petitioner’s employees, this
did not make his loss and moral suffering insignificant and
less deserving of compensation. In repeatedly ignoring
respondent’s inquiries, petitioner’s employees exhibited an
indifferent attitude without due regard for the
inconvenience and anxiety he experienced after realizing
that his luggage was missing. Petitioner was thus guilty of
bad faith in breaching its contract of carriage with the
respondent, which entitles the latter to the award of moral
damages.
Absence of Bad Faith
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Phil. Air Lines v. Miano
G.R. No. 106664 | March 8, 1995
Facts:
On August 31, 1988, private respondent took petitioner's
flight bound for Germany. He had an immediate onward
connecting flight via Lufthansa flight to Vienna, Austria. At
the NAIA, he checked-in one brown suitcase but did not
declare a higher valuation. He claimed that his suitcase
contained money, documents, one Nikkon camera with
zoom lens, etc. Upon private respondent's arrival at
Vienna, his checked-in baggage was missing. He reported
the matter to the authorities and after three (3) hours of
waiting, he proceeded to Piestany, Czechoslovakia. Eleven
(11) days after, his suitcase was delivered to him in
Piestany. Respondent instituted an action for damages
before the RTC Makati.
Petitioner’s Argument/s: (WON)
Petitioner contested the complaint of Florante Miano. It
disclaimed any liability on the ground that there was
neither a report of mishandled baggage on flight PR 722
nor a tracer telex received from its Vienna Station. It,
however, contented that if at all liable its obligation is
limited by the Warsaw Convention rate.
Respondent’s Arguments: (LOST)
Miano claimed that because of the delay in the delivery of
his suitcase, he was forced to borrow money to buy some
clothes, to pay $200.00 for the transportation of his
baggage from Vienna to Piestany, and lost his Nikkon
camera.
Ruling of the lower court:
The trial court observed that petitioner's actuation was not
attended by bad faith. Nevertheless, it awarded private
respondent damages and attorney's fees.
Issue:
WON the RTC erred in awarding moral and exemplary
damages to private respondent (YES)
Rule:
Art. 2220. Willful injury to property may be a legal ground
for awarding moral damages if the court find that, under
the circumstances, such damages are justly due. The same
rule applies to breaches of contract where the defendant
acted fraudulently or in bad faith.
Art. 2232. In contracts and quasi-contracts, the court may
award exemplary damages if the defendant acted in a
wanton, fraudulent, reckless, oppressive, or malevolent
manner.
Application:
In breach of contract of carriage by air, moral damages
are awarded only if the defendant acted fraudulently or in
bad faith. The trial court erred in awarding moral damages
to private respondent. The established facts evince that
petitioner's late delivery of the baggage for eleven (11)
days was not motivated by ill will or bad faith. The SC
neither sustained the award of exemplary damages. The
prerequisite for the award of exemplary damages in cases
of contract or quasi-contract is that the defendant acted in
wanton, fraudulent, reckless, oppressive, or malevolent
manner. The undisputed facts do not so warrant the
characterization of the action of petitioner.
The award of attorney's fees must also be disallowed for
lack of legal leg to stand on. Needless to say, award of
attorney’s fees must be deleted where the award of moral
and exemplary damages are eliminated.
Assailed Decision MODIFIED deleting the award of moral
and exemplary damages and attorney's fees.
Waiver of Applicability
Lufthansa German Airlines v. IAC
G.R. No. 71238 | March 19, 1992
Facts:
On January 21, 1979, respondent Henry H. Alcantara
shipped thirteen (13) pieces of luggage through petitioner
Lufthansa from Teheran to Manila as evidenced by
Lufthansa Air Waybill No. 220-9776-2733. The Air Waybill
discloses that the actual gross weight of the thirteen (13)
pieces of luggage is 180 kilograms. Respondent Henry H.
Alcantara did not declare an inventory of the contents or
the value of the luggages when he delivered them to
Lufthansa.
On March 3, 1979, the thirteen (13) pieces of luggage were
boarded in one of Lufthansa's flights which arrived in
Manila on the same date. After the luggages arrived in
Manila, the consignee, respondent Teresita Alcantara, was
able to claim from the cargo broker Philippine Skylanders,
Inc. on March 6, 1979 only twelve (12) out of the thirteen
(13) pieces of luggage with a total weight of 174
kilograms.
The private respondents advised Lufthansa of the loss of
one of the luggages and of the contents thereof. Petitioner
Lufthansa sent telex tracing messages to different stations
and to the Philippine Airlines which actually carried the
cargo. But all efforts in tracing the missing luggage were
fruitless.
Since efforts to trace the missing luggage yielded negative
results, Lufthansa informed Henry Alcantara accordingly
and advised him to file a claim invoice.
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On September 24, 1979, the private respondents wrote
the petitioner demanding the production of the missing
luggage within then (10) days from receipt. Since the
petitioner did not comply with said demand, the private
respondents filed a complaint dated May 7, 1980, for
breach of contract with damages against the petitioner
before the Court of First Instance of Manila.
Petitioner’s Argument/s: (LOST)
The petitioner filed its answer to the complaint alleging
that the Warsaw Convention limits the liability of the
carrier, if any, with respect to cargo to a sum of 250 francs
per kilo ($20.00 per kilo or $9.07 per pound), unless a
higher value is declared in advance and additional charges
are paid by the passenger and the conditions of the
contract as set forth in the air waybill expressly subject the
contract of carriage of cargo to the Warsaw Convention.
The petitioner also alleged that it never acted fraudulently
or in bad faith so as to entitle respondent spouses to moral
damages and attorney's fees, nor did it act in a wanton,
fraudulent, reckless, oppressive or malevolent manner as
to entitle spouses to exemplary damages.
Respondent’s Arguments: (WON)
The private respondents maintain that the petitioner, as
found by the trial and appellate courts, waived the benefits
of the Warsaw Convention when it offered a settlement in
the amount of $200.00 which is much higher than what
the Convention prescribes and never raised timely
objections during the trial to the introduction of evidence
regarding the actual claims and damages sustained by
respondent Alcantara.
Ruling of the lower court:
Issue:
Whether or not the private respondents are entitled to an
award of damages beyond the liability set forth in the
Warsaw Convention and in the Airwaybill of Lading. YES.
Rule:
Under the circumstances, there appears to be no cogent
reason to disturb the factual findings of both the trial court
and the Court of Appeals.
Furthermore, the respondent court found that petitioner
waived the applicability of the Warsaw Convention to the
case at bar when it offered private respondent a higher
amount than that which is provided in the said law and
failed to raise timely objections during the trial when
questions and answers were brought out regarding the
actual claims and damages sustained by Alcantara which
were even subjected to lengthy cross examination by
Lufthansa's counsel.
Application:
The applicability of the Warsaw Convention can be waived.
British Airways v. Court of Appeals
G.R. No 121824. | January 29, 1998
Facts:
On April 1989, Mahtani decided to visit his relatives in
Bombay, India. He obtained the services of Mr. Gumar to
prepare his travel plans. The latter purchased a ticket from
British Airways (BA). Since BA had no direct flights from
Manila to Bombay, Mahtani had to take a flight to
Hongkong via PAL, and upon arrival in Hongkong he had
to take a connecting flight to Bombay on board BA.
Prior to his departure, Mahtani checked in at the PAL
counter in Manila his two pieces of luggage containing his
clothing and personal effects, confident that upon reaching
Hongkong, the same would be transferred to the BA flight
bound for Bombay. When Mahtani arrived in Bombay he
discovered that his luggage was missing and that upon
inquiry from the BA representatives, he was told that the
same might have been diverted to London. After patiently
waiting for his luggage for one week, BA finally advised
him to file a claim by accomplishing the Property
Irregularity Report.
Petitioner’s Argument/s: (LOST)
Mahtani failed to declare a higher valuation with respect to
his luggage, a condition provided for in the ticket, which
reads “Liability for loss, delay, or damage to baggage is
limited unless a higher value is declared in advance and
additional charges are paid.” Since Mahtani failed to
declare a separate higher valuation for the luggage, and
therefore, its liability is limited, at most, only to the
amount stated in the ticket.
Respondent’s Arguments: (WON)
No specific argument, filed a claim for damages and atty’s
fees.
Ruling of the lower court:
After appropriate proceedings and trial, the trial court
rendered its decision in favor of Mahtani. Defendant is
ordered to pay plaintiff the value of the 2 pieces of luggage
and of its contents, moral and actual damages and for
attorney’s fees and costs of the action.
Issue:
Whether or not the award of the damages was without
basis since Mahtani failed to declare a higher valuation to
his luggage. (NO)
Rule:
American jurisprudence provides that an air carrier is not
liable for the loss of baggage in an amount in excess of the
limits specified in the tariff which was filed with the proper
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authorities, such tariff being binding on the passenger
regardless of the passenger’s lack of knowledge thereof or
assent thereto. This doctrine is recognized in this
jurisdiction.
Application:
The benefits of limited liability are subject to waiver such
as when the air carrier failed to raise timely objections
during the trial when questions and answers regarding the
actual claims and damages sustained by the passenger
were asked. The inescapable conclusion that BA had
waived the defense of limited liability when it allowed
Mahtani to testify as to the actual damages he incurred
due to misplacement of his luggage, without any objection.
It is a well-settled doctrine that where the proponent offers
evidence deemed by counsel of the adverse party to be
inadmissible for any reason, the latter has the right to
object. However, such right is a mere privilege which can
be waived. Necessarily, the objection must be made at the
earliest opportunity, in case of silence when there is
opportunity to speak may operate as a waiver of
objections. BA has precisely failed in this regard. To
compound matters for BA, its counsel failed, not only to
interpose a timely objection, but even conducted his own
cross-examination as well
Notice of Loss
Federal Express Corp. v. American Home Assurance
Co.,
G.R. No. | Date
Facts:
● SMITHKLINE acquired the services of Federal
Express to deliver 109 cartons of veterinary
biologicals from Nebraska to Manila.
● On that same day SMITHKLINE insured the
products through American Home Assurance
Company (AHAC)
● On the face of the cartons it was marked that the
goods should be refrigerated.
● When the goods reached Manila it was stored by
Cargohaus, a subcontractor of Federal Express, in
a cool room only. This rendered the goods
unusable which led SMITHKLINE to abandon the
goods at the custom house.
● The goods being insured, SMITHKLIE was
compensated by AHAC. AHAC was then
subrogated with the rights of SMITHKLINE.
● AHAC then instituted a case for damages against
Federal Express
Petitioner’s Argument/s: (Won)
● Federal Express claims that they are now
exempted from the liability as they were never
that the goods were damaged
 ● Federal Express claims SMITHKLINE did not
comply with the conditions set in the airway bill
nor did it notify them about the loss or damage
as set in the Warsaw Convention
Respondent’s Arguments: (Lost)
● AHAC claims that it has the personality to sue for
damages as it was subrogated with the rights of
SMITHKLINE
Ruling of the lower court:
● RTC ruled in favor of AHAC and held Federal
Express to be solidarily liable for the damages
● CA affirmed RTC ruling
Issue:
Whether Federal Express is liable for damages when it was
not notified of the loss or damage of the goods in
accordance with the airway bill and/or the Warsaw
Convention (No)
Rule:
● Article 26 (2) of the Warsaw convention provides
that in case of damage, the person entitled to
delivery must complain to the carrier forthwith
after the discovery of the damage, and, at the
latest, within 3 days from the date of receipt in
the case of baggage and 7 days from the date of
receipt in the case of goods. In case of delay the
complaint must be made at the latest within 14
days from the date on which the baggage or
goods have been placed at his disposal
● the filing of a claim with the carrier within the
time limitation therefore actually constitutes a
condition precedent to the accrual of a right of
action against a carrier for loss of or damage to
the goods.
Application:
● In the case at bar the Supreme Court ruled that
notifying the carrier with the loss or damage of
the goods received is a condition precedent
before filing a case for damages.
● This protects the carrier by giving it time to
investigate the claims and help it avoid false or
fraudulent claims
● SMITHKLINE failing to notify Federal Express
within the period stated in the airway bill and/or
by the Warsaw convention has lost its right to
claim for damages
Jurisdiction
Santos III v. Northwest Orient Airlines, et al.
G.R. No. 101538 | June 23, 1992
Facts:
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The petitioner (Santos III) as represented by his father
and legal guardian, is a minor and a resident of the
Philippines. The Private respondent on the other hand is
Northwest Orient Airlines (NOA). It is a foreign corporation
with a principal office in Minnesota, USA and licensed to do
business and maintain a branch office in the Philippines.
Petitioner purchased a round-trip ticket in San Francisco,
USA for his flight from San Francisco to Manila via Tokyo
and back. There was however no return date for his return
to San Francisco.
When the petitioner checked in at the NOA counter in San
Francisco airport for his scheduled departure to Manila, he
was waitlisted. Despite a previous confirmation and re-
confirmation, he was informed that he had no reservation
for his flight from Tokyo to Manila.
Petitioner sued NOA for damages in the RTC of Makati.
NOA moved to dismiss the complaint on the ground of lack
of jurisdiction.
Petitioner’s Argument/s:
The Petitioner argues that the lower court erred in not
ruling that Article 28 (1) of the Warsaw Convention is a
rule merely of venue and was waived by defendant when
it did not move to dismiss on the ground of improper
venue.
Lower court erred in not ruling that under Article 28(1) of
the EC, this case was properly filed in the Philippines
because the defendant had its domicile in the Philippines
Lower court erred in not ruling that Article 28(1) does not
apply to actions based on tort
Respondent’s Arguments: WON
Citing Article 28 (1) of the Warsaw Convention, the private
respondent contended that the complaint could be
instituted only in the territory of one of the High
Contracting Parties, before:
1. The court of the domicile of the carrier;
2. The court of its principal place of business;
3. The court where it has a place of business through
which the contract had been made;
4. The court of the place of destination.
They argued that the Philippines was not its domicile nor
was its principal place of business. Neither was the
petitioner’s ticket issued in this country nor was his
destination Manila but San Francisco in the United States.
Ruling of the lower court:
The RTC granted the motion and dismissed the case.
The petitioner appealed to the CA. CA affirmed the decision
of the RTC.
Issue:
WON the Philippines has jurisdiction over the case
Rule:
Article 28 (1) of the Warsaw Convention
An action for damages must be brought, at the option of
the plaintiff, in the territory of one of the High Contracting
Parties, either before the Court having jurisdiction where
the carrier is ordinarily resident, or has his principal place
of business, or has an establishment by which the contract
has been made or before the Court having jurisdiction at
the place of destination.
Application:
Obviously, the constitutional guaranty of access to courts
refers only to courts with appropriate jurisdiction as
defined by law. It does not mean that a person can go to
any court for redress of his grievances regardless of the
nature or value of his claim. If the petitioner is barred from
filing his complaint before our courts, it is because they
are not vested with the appropriate jurisdiction under the
Warsaw Convention, which is part of the law of our land.
By its own terms, the Convention applies to all
international transportation of persons performed by
aircraft for hire.
International Transportation (par. 2 of Article 1): any
transportation in which, according to the contract made by
the parties, the place of departure and the place of
destination, whether or not there be a break in the
transportation or a transhipment, are situated (either)
within the territories of 2 High Contracting Parties.
Whether the transportation is “international” is determined
by the contract of the parties, which in the case of
passengers is the ticket. When the contract of carriage
provides for the transportation of the passenger between
certain designated terminals “within the territories of two
High Contracting Parties,” the provisions of the Convention
automatically apply and exclusively govern the rights and
liabilities of the airline and its passenger.
Since the flight involved in the case at bar is international,
the same being from the United States to the Philippines
and back to the United States, it is subject to the
provisions of the Warsaw Convention, including Article
28(1), which enumerates the four places where an action
for damages may be brought.
The place of destination, within the meaning of the Warsaw
Convention, is determined by the terms of the contract of
carriage or, specifically in this case, the ticket between the
passenger and the carrier. Examination of the petitioner’s
ticket shows that his ultimate destination is San Francisco.
Although the date of the return flight was left open, the
contract of carriage between the parties indicates that NOA
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was bound to transport the petitioner to San Francisco
from Manila. Manila should therefore be considered merely
an agreed stopping place and not the destination.
Article 1(2) also draws a distinction between a
“destination” and an “agreed stopping place.” It is the
“destination” and not an “agreed stopping place” that
controls for purposes of ascertaining jurisdiction under the
Convention. An intermediate place where the carriage may
be broken is not regarded as a “place of destination.”
The domicile of the carrier is only one of the places where
the complaint is allowed to be filed under Article 28(1). By
specifying the three other places, to wit, the principal place
of business of the carrier, its place of business where the
contract was made, and the place of destination, the article
clearly meant that these three other places were not
comprehended in the term “domicile.”
Lopez v. Northwest Airlines, Inc.
G.R. No. 106973 | Date June 17, 1993
Facts:
Petitioner purchased from the private respondent
Northwest Airlines, Inc. (NWA) in New York Ticket No.
8443546771 with bookings for an airplane flight covering
the following destinations: "New York-Seattle-Manila-
Tokyo-New York."
It appears that the petitioner made the trip to the
Philippines on the New York-SeattleManila leg of her ticket
and that her trip back to New York via Tokyo was
confirmed by the private respondent for 10 July 1987.
However, when she went to the latter's representative in
the Philippines on 7 July 1987, or barely two (2) days
before the date of the flight, to reconfirm her booking, she
was informed that she could not be accommodated in view
of its cancellation. Despite her insisting that she be allowed
to take the 10 July 1987 flight as stipulated in her ticket,
private respondent remained adamant; it scheduled her
flight for 11 July 1987. Consequently, the petitioner filed a
complaint for damages against the private respondent
before the Regional Trial Court (RTC) of Makati, Metro
Manila.
Petitioner alleged that in bad faith and utter disregard to
her rights as well as its own obligation under the contract
of carriage, the private respondent unjustly and without
good and/or valid cause cancelled her accommodation in
its scheduled flight for 10 July 1987; as a result thereof,
she supposedly suffered mental anguish, embarrassment,
humiliation and great inconvenience.
Respondent filed a motion to dismiss on the grounds that
the court has no jurisdiction over the subject matter of the
action under the Warsaw Convention.
RTC denied the motion to dismiss on the ground that the
same is not “well taken”. CA affirmed the lower court’s
decision.
Private respondent filed before the SC a petition for review
under Rule 45 of the Rules of Court. Supreme Court
dismissed the petition for the "failure to sufficiently show
that the Court of Appeals had committed any reversible
error in the questioned judgment." Private respondent
sought to have this adverse resolution reconsidered. On 9
May 1990, however, this Court denied the motion with
finality, "the basic issues raised therein having previously
been duly considered and passed upon by this Court in the
aforesaid resolution and no substantial matter having been
adduced to warrant the reconsideration sought.
Private respondent was compelled to go back to the trial
court in Civil Case No. 88-1014 where it filed its Answer
on 31 August 1990. In the meantime, said case was re-
raffled to Branch 65 of the Regional Trial Court of Makati.
Petitioner’s Argument/s: WIN
the jurisdiction of the trial court over the said case had
already long been sustained with finality and
conclusiveness in G.R. No. 91393, now the law of the case
as far as the said questioned jurisdiction is concerned.
Respondent’s Arguments: LOSS
Filed its second motion to dismiss on the ground that the
rulings of the CA (the denial of the private respondents
first motion to dismiss)cannot stand, and therefore must
be deemed overruled and superseded, by the subsequent
decision promulgated by the court in the case of Santos v
Northwest Orient Airlines Inc., the factual setting of which
is substantially identical to that in this case.
Ruling of the lower court:
Grant the second motion to dismiss.
Issue: WON branch 65 of the RTC Makati has jurisdiction
over the case. (YES)
Rule:
Posterior changes in the doctrine of Supreme Court cannot
retroactively applied to nullify a prior final ruling in the
same proceeding where the prior adjudication was had,
whether the case should be civil or criminal in nature.
Application:
In this case, the Supreme Court already dismissed the
petition for review filed by the private respondent
questioning the decision of CA affirming the ruling of RTC
which dismissed the motion to dismiss filed by the private
respondent. For this reason, SC held that there was
nothing more for the trail court to do except decide the
case especially since its 90-days within which to decide the
case had already expired. SC added that in view of its prior
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decision affirming the ruling of CA, branch 65 of RTC
Makati had at least prima facie jurisdiction over the case
and, therefore, the rendition of judgment therein was
undeniably within its authority.
Lhuillier v. British Airways
G.R. No. 171092 | Mar. 15, 2010
Facts: On April 28, 2005, petitioner Edna Diago Lhuillier
filed a Complaint 2 for damages against respondent British
Airways before the Regional Trial Court (RTC) of Makati
City. She alleged that on February 28, 2005,she took
respondent's flight 548 from London, United Kingdom to
Rome, Italy. Once on board, she allegedly requested Julian
Halliday (Halliday), one of the respondent's flight
attendants, to assist her in placing her hand carried
luggage in the overhead bin. However, Halliday allegedly
refused to help and assist her, and even sarcastically
remarked that "If I were to help all 300 passengers in this
flight, I would have a broken back!
Petitioner further alleged that when the plane was about
to land in Rome, Italy, another flight attendant,Nickolas
Kerrigan (Kerrigan), singled her out from among all the
passengers in the business class section to lecture on
plane safety. Allegedly, Kerrigan made her appear to the
other passengers to be ignorant, uneducated, stupid, and
in need of lecturingon the safety rules and regulations of
the plane.
Affronted, petitioner assured Kerrigan that she knew the
plane's safety regulations being a frequent traveler.
Thereupon, Kerrigan allegedly thrust his face a mere few
centimeters away from that of the petitioner and
menacingly told her that "We don't like your attitude."
Upon arrival in Rome, the petitioner complained to the
respondent's ground manager and demanded an apology.
However, the latter declared that the flight stewards were
only doing their job.
Petitioner’s Argument/s (LOST): Thus, petitioner filed
the complaint for damages, praying that respondent be
ordered to pay ₱5 million as moral damages, ₱2 million as
nominal damages, ₱1 million as exemplary damages,
₱300,000.00 as attorney’s fees, ₱200,000.00 as litigation
expenses, and cost of the suit.
Respondent’s Arguments (WON): Respondent, by way
of special appearance through counsel, filed a Motion to
Dismiss on grounds of lack of jurisdiction over the case
and over the person of the respondent. Respondent
alleged that only the courts of London, United Kingdom or
Rome, Italy, have jurisdiction over the complaint for
damages pursuant to the Warsaw Convention, Article
28(1).
Ruling of the lower court: The RTC of Makati City
dismissed the case, ruling that since the Philippines is not
the place of domicile of the defendant nor is it the principal
place of business, our courts are thus divested of
jurisdiction over cases for damages. Neither was the
plaintiff's ticket issued in this country nor was her
destination Manila but Rome in Italy.
Issue: WON Philippine courts have jurisdiction over a
tortious conduct committed against a filipino citizen and
resident by airline personnel of a foreign carrier travelling
beyond the territorial limit of any foreigncountry; and thus
is outside the ambit of the Warsaw convention.
Rule: It is settled that the Warsaw Convention has the
force and effect of law in this country. Thus, when the
place of departure and the place of destination in a
contract of carriage are situated within the territories of
two High Contracting Parties, said carriaoge is deemed an
"international carriage". The High Contracting Parties
referred to herein were the signatories to the Warsaw
Convention and those which subsequently adhered to it.
Application:
Petitioner's place of departure was London, United
Kingdom while her place of destination was Rome, Italy.
Both the United Kingdomand Italy signed and ratified the
Warsaw Convention. As such, the transport of the
petitioner is deemed to be an "international carriage"
within the contemplation of the Warsaw Convention. The
Warsaw Convention applies because the air travel, where
the alleged tortious conduct occurred, was between the
United Kingdomand Italy, which are both signatories to the
Warsaw Convention.
Respondent is a British corporation domiciled in London,
United Kingdom with London as its principal place of
business. Hence, under the first and second jurisdictional
rules, the petitioner may bring her case before the courts
of London in the United Kingdom. In the passenger ticket
and baggage check presented by both the petitioner and
respondent, it appears that the ticket was issued in Rome,
Italy. Consequently, under the third jurisdictional rule, the
petitioner has the option to bring her case before the
courts ofRome in Italy.
Finally, both the petitioner and respondent aver that the
place of destination is Rome, Italy, which is properly
designated given the routing presented in the said
passenger ticket and baggage check. Accordingly, the
petitioner may bring heraction before the courts of Rome,
Italy. We thus find that the RTC of Makati correctly ruled
that it does not have jurisdiction over the case filed by the
petitioner.
On the argument that her cause of action arose from the
tortious conduct of the airline personnel and violation of
TRANSPORTATION LAWS | ATTY. CAPANAS | MODULE 7 CASE DIGEST COMPILATION | EH405 2020-2021 | PAGE | 33
the Civil Code provisions on HumanRelations. Allegation of
willful misconduct resulting in a tort is insufficient to
exclude the case from the realm of the Warsaw
Convention.
Prescription
Philippine Airlines, Inc. v. Hon. Adriano Savillo,
Presiding Judge of RTC Branch 30, Iloilo City, and
Simplicio Griño
G.R. No. 149547 | July 4, 2008
Facts:
Private respondent was invited to participate in a golf
tournament in Jakarta, Indonesia. He purchased a ticket
from PAL with the following passage points: MANILA -
SINGAPORE - JAKARTA - SINGAPORE - MANILA. When
they arrived at Singapore at about 6 pm, they went to
Singapore Airlines to check-in for their flight to Jakarta.
Singapore Airlines rejected their tickets as it was not
endorsed by PAL. They reasoned that if they accepted the
tickets prior to PAL's endorsement, PAL would not pay
them for their passage. When they called PAL’s office, they
found out that it was closed. They were stranded at the
airport left with no recourse. Respondent was subjected to
humiliation, embarrassment and distress. Eventually, they
decided to purchase a ticket going to Jakarta from Garuda
Airlines. When they arrived at midnight, the person who
was supposed to pick them up already left and they had to
arrange transportation at a very late hour.
Due to the nerve-wracking events that have transpired,
respondent became ill and was not able to join the
tournament. Upon his return to the Philippines, he sent
demand letters to both PAL and Singapore Airline.
However, both denied liability and blamed one another for
the fiasco. 3 years later, Respondent then filed a complaint
for Damages. PAL filed a Motion to Dismiss on the ground
of prescription. PAL argued that the Warsaw Convention
applies in this case. It provides that any claim for damages
in connection with international transportation of persons
is subject to a prescriptive period of two years.
This is a Petition for Certiorari assailing the Decision
rendered by CA which affirmed in toto the Order of RTC of
Iloilo City.
Petitioner’s Argument/s: (LOST)
Petitioner argues that CA erred in not giving due course to
the petition as respondent judge committed grave abuse
of discretion amounting to lack of jurisdiction in denying
PAL’s Motion to Dismiss, erred in not applying the
provisions of the Warsaw Convention despite the fact that
Griño’s cause of action arose from a breach of contract for
international airport, and erred in not holding that the
complaint filed by Griño beyond the two-year period
provided under the Warsaw Convention is already barred In the case at hand, Singapore Airlines barred private
by prescription. respondent from boarding the Singapore Airlines flight
because PAL allegedly failed to endorse the tickets of
Respondent’s Arguments: (WON) private respondent and his companions, despite PAL’s
Private respondent’s Complaint alleged that both PAL and assurances to respondent that Singapore Airlines had
Singapore Airlines were guilty of gross negligence, which already confirmed their passage. While this fact still needs
resulted in his being subjected to "humiliation, to be heard and established by adequate proof before the
embarrassment, mental anguish, serious anxiety, fear and RTC, an action based on these allegations will not fall
distress. under the Warsaw Convention, since the purported
negligence on the part of PAL did not occur during the
Ruling of the lower court: performance of the contract of carriage but days before
the scheduled flight. Thus, the present action cannot be
Trial court denied the Motion to Dismiss. It maintained that dismissed based on the statute of limitations provided
the provisions of the Civil Code and other pertinent under Article 29 of the Warsaw Convention.
Philippine Laws apply and not the Warsaw Convention. The
Court of Appeals affirmed the decision of the lower court. Had the present case merely consisted of claims incidental
Article 1144 of the Code states that the prescription period to the airlines’ delay in transporting their passengers, the
for claims for damages is 10 years. private respondent’s Complaint would have been time-
barred under Article 29 of the Warsaw Convention.
Issue: (NO) However, the present case involves a special species of
Whether or not, the Court of Appeals erred in not applying injury resulting from the failure of PAL and/or Singapore
the provisions of the Warsaw Convention. Airlines to transport private respondent from Singapore to
Rule: Jakarta – the profound distress, fear, anxiety and
humiliation that private respondent experienced when,
Art. 1144. The following actions must be brought within despite PAL’s earlier assurance that Singapore Airlines
ten years from the time the right of action accrues: confirmed his passage, he was prevented from boarding
(1) Upon a written contract; the plane and he faced the daunting possibility that he
(2) Upon an obligation created by law; would be stranded in Singapore Airport because the PAL
(3) Upon a judgment. (n) office was already closed.

Application: These claims are covered by the Civil Code provisions on

tort, and not within the purview of the Warsaw Convention.
The Warsaw Convention applies to "all international
transportation of persons, baggage or goods performed by
any aircraft for hire." It seeks to accommodate or balance
the interests of passengers seeking recovery for personal
injuries and the interests of air carriers seeking to limit
potential liability. It employs a scheme of strict liability
favoring passengers and imposing damage caps to benefit
air carriers. The cardinal purpose of the Warsaw
Convention is to provide uniformity of rules governing
claims arising from international air travel; thus, it
precludes a passenger from maintaining an action for
personal injury damages under local law when his or her
claim does not satisfy the conditions of liability under the
Convention.

Article 19 of the Warsaw Convention provides for liability

on the part of a carrier for "damages occasioned by delay
in the transportation by air of passengers, baggage or
goods." Article 24 excludes other remedies by further
providing that "(1) in the cases covered by articles 18 and
19, any action for damages, however founded, can only be
brought subject to the conditions and limits set out in this
convention." Therefore, a claim covered by the Warsaw
Convention can no longer be recovered under local law, if
the statute of limitations of two years has already lapsed.

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