CASE DIGEST: Air France vs Gillego

G.R. No. 165266 : December 15, 2010

AIR FRANCE,Petitioner, v. BONIFACIO H. GILLEGO, substituted by his surviving heirs represented by Dolores P. Gillego,Respondent.



Respondent Bonifacio H. Gillego, then incumbent Congressman of the Second District of Sorsogon and Chairman of the House of Representatives Committee on Civil, Political and Human Rights, was invited to participate as one of the keynote speakers at the 89th Inter-Parliamentary Conference Symposium on Parliament Guardian of Human Rights to be held in Budapest, Hungary and Tokyo, Japan from May 19 to 22, 1993. The Philippines is a member of the Inter-Parliamentary Union which organized the event.

On May 16, 1993, respondent left Manila on board petitioner Air Frances aircraft bound for Paris, France. He arrived in Paris early morning of May 17, 1993 (5:00 a.m.). While waiting at the De Gaulle International Airport for his connecting flight to Budapest scheduled at 3:15 p.m. that same day, respondent learned that petitioner had another aircraft bound for Budapest with an earlier departure time (10:00 a.m.) than his scheduled flight. He then went to petitioners counter at the airport and made arrangements for the change in his booking. He was given a corresponding ticket and boarding pass for Flight No. 2024 and also 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 counter at the airport where petitioners representative verified from their computer that he had indeed a checked-in luggage. He was advised to just wait for his luggage at his hotel and that petitioners representatives would take charge of delivering the same to him that same day. But said luggage was never delivered by petitioners representatives despite follow-up inquiries by respondent.

Upon his return to the Philippines, respondents lawyer immediately wrote petitioners Station Manager complaining about the lost luggage and the resulting damages he suffered while in Budapest. He was thus left with only his travel documents, pocket money and the clothes he was wearing. Because petitioners representatives in Budapest failed to deliver his luggage despite their assurances and his repeated follow-ups, respondent was forced to shop for personal items including new clothes and his medicines. Aside from these unnecessary expenditures of about $1,000, respondent had to prepare another speech, in which he had difficulty due to lack of data and information. Respondent thus demanded the sum of P1,000,000.00 from the petitioner as compensation for his loss, inconvenience and moral damages. Petitioner, however, continued to ignore respondents repeated follow-ups regarding his lost luggage.

Respondent filed a complaint for damages against the petitioner alleging that by reason of its 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. Respondent asserted that as a common carrier which advertises and offers its services to the public, petitioner is under obligation to observe extraordinary diligence in the vigilance over checked-in luggage and to see to it that respondents luggage entrusted to petitioners custody would accompany him on his flight and/or could be claimed by him upon arrival at his point of destination or delivered to him without delay. Petitioner should therefore be held liable for actual damages ($2,000.00 orP40,000.00), moral damages (P1,000,000.00), exemplary damages (P500,000.00), attorneys fees (P50,000.00) and costs of suit.

Petitioner filed its answer admitting that respondent was issued tickets for the flights mentioned, his subsequent request to be transferred to another flight while at the Paris airport and the loss of his checked-in luggage upon arrival at Budapest, which luggage has not been retrieved to date and the respondents repeated follow-ups ignored. As special and affirmative defense, petitioner contended that its liability for lost checked-in baggage is governed by the Warsaw Convention for the Unification of Certain Rules Relating to International Carriage. Under the said treaty, petitioners liability for lost or delayed registered baggage of respondent is limited to 250 francs per kilogram or US$20.00, which constitutes liquidated damages and hence respondent is not entitled to any further damage.

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 respondents luggage is due to or occasioned by force majeure or fortuitous event or other causes beyond the carriers control.

The trial court rendered its decision in favor of respondent and against the petitioner. It ordered defendant to pay plaintiff: P1,000,000.00 as moral damages; P500,000.00 as exemplary damages; P50,000.00 as attorneys fees; and the costs.

Petitioner appealed to the CA, which affirmed the trial courts decision. It bears stressing that defendant-appellant committed a breach of contract by its failure to deliver the luggage of plaintiff-appellee on time despite demand from plaintiff-appellee. Comparing the situation in this case to other cases awarding similar damages to the aggrieved passenger as a result of breaches of contract by international carriers, petitioner argues that even assuming that respondent was entitled to moral and exemplary damages, the sums adjudged should be modified or reduced.

Petitioner reiterates that there was no bad faith or negligence on its part and the burden is on the respondent to prove by clear and convincing evidence that it acted in bad faith. Petitioner adduced evidence showing that it exerted diligent, sincere and timely efforts to locate the missing baggage, eventually leading to its recovery. It attended to respondents problem with utmost courtesy, concern and dispatch. Respondent, moreover, never alleged that petitioners employees were at anytime rude, mistreated him or in anyway showed improper behavior.

ISSUE: Whether or not the trial Court in finding the Petitioner liable for unreasonable delay for the delivery of the respondents luggage.

HELD: The decision of the Court of Appeals is partially sustained.

CIVIL LAW: breach of contract of carriage

Article 1735 of the Civil Code provides that in case of lost or damaged goods, common carriers are presumed to have been at fault or to have acted negligently, unless they prove that they observed extraordinary diligence as required by Article 1733. Thus, in an action based on a breach of contract of carriage, the aggrieved party does not have to prove that the common carrier was at fault or was negligent. All that he has to prove is the existence of the contract and the fact of its non-performance by the carrier. China Air Lines, Ltd. v. Court of Appeals, G.R. Nos. 45985 & 46036, May 18, 1990

That respondents checked-in luggage was not found upon arrival at his destination and was not returned to him until about two years later is not disputed. The action filed by the respondent is founded on such breach of the contract of carriage with petitioner who offered no satisfactory explanation for the unreasonable delay in the delivery of respondents baggage. The presumption of negligence was not overcome by the petitioner and hence its liability for the delay was sufficiently established. However, upon receipt of the said luggage during the pendency of the case in the trial court, respondent did not anymore press on his claim for actual or compensatory damages and neither did he adduce evidence of the actual amount of loss and damage incurred by such delayed delivery of his luggage. Consequently, the trial court proceeded to determine only the propriety of his claim for moral and exemplary damages, and attorneys fees.

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. Not every case of mental anguish, fright or serious anxiety calls for the award of moral damages. Where in breaching the contract of carriage the airline is not shown to have acted fraudulently or in bad faith, liability for damages is limited to the natural and probable consequences of the breach of the obligation which the parties had foreseen or could have reasonably foreseen. In such a case the liability does not include moral and exemplary damages. Cathay Pacific Airways Ltd. v. Vasquez, G.R. No. 150843, March 14, 2003

While respondent failed to cite any act of discourtesy, discrimination or rudeness by petitioners employees, this did not make his loss and moral suffering insignificant and less deserving of compensation. In repeatedly ignoring respondents inquiries, petitioners 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.1awphi1

However, we agree with petitioner that the sum of P1,000,000.00 awarded by the trial court is excessive and not proportionate to the loss or suffering inflicted on the passenger under the circumstances. As in Trans World Airlines v. Court of Appeals, No. L-78656, August 30, 1988 where this Court after considering the social standing of the aggrieved passenger who is a lawyer and director of several companies, the amount of P500,000.00 awarded by the trial court as moral damages was still reduced toP300,000.00, the moral damages granted to herein respondent should likewise be adjusted.

Article 2216 of the Civil Code provides that assessment of damages is left to the discretion of the court according to the circumstances of each case. This discretion is limited by the principle that the amount awarded should not be palpably excessive as to indicate that it was the result of prejudice or corruption on the part of the trial court. Simply put, the amount of damages must be fair, reasonable and proportionate to the injury suffered. Philippine Airlines, Incorporated v. Court of Appeals, G.R. No. 123238, September 22, 2008

Where as in this case the air carrier failed to act timely on the passengers predicament caused by its employees mistake and more than ordinary inadvertence or inattention, and the passenger failed to show any act of arrogance, discourtesy or rudeness committed by the air carriers employees, the amounts of P200,000.00,P50,000.00 and P30,000.00 as moral damages, exemplary damages and attorneys fees would be sufficient and justified.

The petition is DENIED.