PANTALEON V. AMERICAN EXPRESS INTERNATIONAL, INC.

GR. NO. 174269, MAY 8, 2009

PONENTE: JUSTICE TINGA
PREPARED BY: AZIS, JOHAMIL L.
SAN BEDA UNIVERSITY COLLEGE OF LAW
ACADEMIC YEAR 20-21

FACTS:

The petitioner, Polo Pantaleon, together with her family, joined an escorted tour of Western Europe
in October of 1991. During the last day of the tour, they arrived at the Coster Diamond House at
8:50 in the morning. The group had agreed to leave Coster by 9:30 to allow enough time take in a
guided tour of Amsterdam. Mrs. Pantaleon bought a 2.5 karat diamond, a penchant and a chain.
She used her American Express credit card to pay for her purchases. 10 minutes later, the store
clerk informed her that her AmEx card had not yet been approved. As it was already 9:40 am, Mr.
Pantaleon was already worried about further inconveniencing the tour group, Pantaleon asked the
store clerk to cancel the sale. The store manager though asked plaintiff to wait a few more minutes.

At around 10:00 am or 30 minutes after the tour group was supposed to have left the store, Coster
decided to release the items even without respondent’s approval of the purchase. The spouses
Pantaleon returned to the bus. It is alleged that their offers of apology were met by their tour mates
with stony silence. The tour group’s visible irritation was aggravated when the tour guide
announced that the city tour of Amsterdam was to be canceled due to lack of remaining time, as
they had to catch a 3:00 p.m. ferry at Calais, Belgium to London. Mrs. Pantaleon ended up
weeping, while her husband had to take a tranquilizer to calm his nerves.

After coming back to Manila, Pantaleon sent a letter through counsel to the respondent, demanding
an apology for the "inconvenience, humiliation and embarrassment he and his family thereby
suffered" for respondent’s refusal to provide credit authorization for the aforementioned
purchases. The aggrieved cardholder instituted an action for damages with the RTC. Pantaleon
prayed that he be awarded ₱2,000,000.00, as moral damages; ₱500,000.00, as exemplary damages;
₱100,000.00, as attorney’s fees; and ₱50,000.00 as litigation expenses.

ISSUE: Whether the respondent had committed a breach of its obligations to Pantaleon.

HELD:

The RTC had concluded, based on the testimonial representations of Pantaleon and respondent’s
credit authorizer, Edgardo Jaurigue, that the normal approval time for purchases was "a matter of
seconds." Based on that standard, respondent had been in clear delay with respect to the three
subject transactions. As it appears, the Court of Appeals conceded that there had been delay on the
part of respondent in approving the purchases. The SC agrees with the findings of the trial court,
for it amply established that the tardiness on the part of respondent in acting on petitioner’s
purchase at Coster did constitute culpable delay on its part in complying with its obligation to act
promptly on its customer’s purchase request. The Court recognizes that respondent has the right,
if not the obligation, to verify whether the credit it is extending upon on a particular purchase was
indeed contracted by the cardholder, and that the cardholder is within his means to make such
transaction. The culpable failure of respondent herein is not the failure to timely approve
petitioner’s purchase, but the more elemental failure to timely act on the same, whether favorably
or unfavorably. Even assuming that respondent’s credit authorizers did not have sufficient basis
on hand to make a judgment, we see no reason why respondent could not have promptly informed
petitioner the reason for the delay, and duly advised him that resolving the same could take some
time. In that way, petitioner would have had informed basis on whether or not to pursue the
transaction at Coster, given the attending circumstances. Instead, petitioner was left uncomfortably
dangling in the chilly autumn winds in a foreign land and soon forced to confront the wrath of
foreign folk. It should be emphasized that the reason why petitioner is entitled to damages is not
simply because respondent incurred delay, but because the delay, for which culpability lies under
Article 1170, led to the particular injuries under Article 2217 of the Civil Code for which moral
damages are remunerative.26 Moral damages do not avail to soothe the plaints of the simply
impatient, so this decision should not be cause for relief for those who time the length of their
credit card transactions with a stopwatch. The somewhat unusual attending circumstances to the
purchase at Coster – that there was a deadline for the completion of that purchase by petitioner
before any delay would redound to the injury of his several traveling companions – gave rise to
the moral shock, mental anguish, serious anxiety, wounded feelings and social humiliation
sustained by the petitioner, as concluded by the RTC.27 Those circumstances are fairly unusual,
and should not give rise to a general entitlement for damages under a more mundane set of facts.