transportation law cases iii

7/23/2019 Transportation Law Cases III

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42 Phil 205 Heacock v. Macondray

1.Common Carrier; Bill of Lading; Stipulations Regarding Liability

of Carrier for Loss of or Damage to Cargo; Validity of such

Stipulations.—hree !inds of stipulation ha"e often been made in

a bill of lading. he #rst is one e$empting the carrier from any andall liability for loss or damage occasioned by its o%n negligence.

he second is one pro"iding for an un&uali#ed limitation of such

liability to an agreed "aluation. 'nd the third is one limiting the

liability of the carrier to an agreed "aluation unless the shipper

declare a higher "alue and pays a. higher rate of freight.

'ccording to an almost uniform %eight of authority( the #rst and

second !inds of stipulations are in"alid as being contrary to public

policy( but the third is "alid and enforceable.

).*d.; *d.; *d.—' stipulation in a bill of lading %hich either e$empts

the carrier from liability for loss or damage occasioned by its

negligence( or pro"ides for an un&uali#ed limitation of such

liability to an agreed "aluation( is in"alid as being contrary to

public policy.

+.*d.; *d.; *d.—But a stipulation in such bill of lading %hich limits

the liability of the carrier to a speci#ed amount unless the shipper

declares a higher "alue and pays a higher rate of freight( is "alidand enforceable. hus( if a common carrier gi"es to a shipper the

choice of t%o rates( the lo%er of them conditioned upon his

agreeing to a stipulated "aluation of his property in case of loss(

e"en by the carrier,s negligence( if the shipper ma!es the choice

understandingly and freely( and names his "aluation( he cannot

thereafter reco"er more than the "alue %hich he thus places upon

his property.

-.Contract; Construction of( in Case of Doubt.—' %ritten contract(

in case of doubt( should be interpreted againts the party %ho hasdra%n the contract. *t is a %ell!no%n principle of construction

that ambiguity or uncertainty in an agreement must be construed

most strongly against the party causing it. here rules are

applicable to contracts contained in bills of lading. *n construing a

bill of lading gi"en by the carrier for the safe transportation and



deli"ery of goods shipped by a consignor( the contract %ill be

construed most strongly against the carrier( and fa"orably to the

consignor( in case of doubt in any matter of construction.

Shewaram v. PAL

Common carriers; /hen limitation of carrier0s liability clause

printed at the bac! of the tic!et stub is not binding.—nder 'rticle

1234 of the 5e% Ci"il Code( the pecuniary liability of a common

carrier may by contract be limited to a #$ed amount pro"ided that

the contract is reasonable and 6ust under the circumstances and

has been fairly and freely agreed upon. /here the conditions

printed at the bac! of a tic!et stub are in letters so small that they

are hard to read( this %ould not %arrant the presumption that the

passenger %as a%are of those conditions such that he had 7fairlyand freely agreed8 to them. 9e is not and cannot( therefore( be

bound( by the conditions of carriage found at the bac! of the

tic!et stub.

Same; Carrier cannot limit its liability for loss due to its

negligence.—/here the transistor radio and the camera of the

passenger %as lost as a result of the negligence of the common

carrier( its liability is clear—it must pay the passenger the "alue of

those t%o articles. he carrier cannot limit its liability for in6ury toor loss of goods shipped %here such in6ury or loss %as caused by

its o%n negligence.

Ong Yiu v. A

Ci"il La%; ransportation; Breach of contract of transportation;

Bad faith( Concept of; 5o bad faith committed %hen airline

company e$erted due diligence %ith its duty in locating a

passenger0s lost luggage; Case at bar.—:rom the facts of thecase( %e agree %ith respondent Court that 'L had not acted in

bad faith. Bad faith means a breach of a !no%n duty through

some moti"e of interest or ill %ill. *t %as the duty of 'L to loo! for

petitioner0s luggage %hich had been miscarried. 'L e$erted due

diligence in complying %ith such duty.



Same; Same; Same; Same; <oral Damages; 5o a%ard of moral

damages %hen bad faith is absent.—*n the absence of a %rongful

act or omission or of fraud or bad faith( petitioner is not entitled to

moral damages.

Same; Same; Same; Same; =$emplary Damages; =$emplarydamages not a%arded %hen defendant had not acted fraudulently

or oppressi"ely.—etitioner is neither entitled to e$emplary

damages. *n contracts( as pro"ided for in 'rticle ))+) of the Ci"il

Code( e$emplary damages can be granted if the defendant acted

in a %anton( fraudulent( rec!less( oppressi"e( or male"olent

manner( %hich has not been pro"en in this case.

Same; Same; Same; Contracts of adhesion; hilippine 'ir Lines0

limited carriage liability of 144.44 for loss or delay of itspassengers0 baggage held "alid and binding absent higher "alue

declared for luggage and actual "alue of goods lost.—/hile it may

be true that petitioner had not signed the plane tic!et >=$h. 71)8?(

he is ne"ertheless bound by the pro"isions thereof. 7Such

pro"isions ha"e been held to be a part of the contract of carriage(

and "alid and binding upon the passenger regardless of the

latter0s lac! of !no%ledge or assent to the regulation8. *t is %hat is

!no%n as a contract of 7adhesion8( in regards %hich it has been

said that contracts of adhesion %herein one party imposes aready made form of contract on the other( as the plane tic!et in

the case at bar( are contracts not entirely prohibited.

he one %ho adheres to the contract is in reality free to re6ect it

entirely; if he adheres( he gi"es his consent. 'nd as held in

Randolph ". 'merican 'irlines( 14+ @hio 'pp. 12)( 1-- 5.=. )d

A2A; Rosenchein "s. rans /orld 'irlines( *nc.( +- S./. )d -A+( 7a

contract limiting liability upon an agreed "aluation does not

oend against the policy of the la% forbidding one fromcontracting against his o%n negligence.8 Considering( therefore(

that petitioner had failed to declare a higher "alue for his

baggage( he cannot be permitted a reco"ery in e$cess of 144.44.

Besides( passengers are ad"ised not to place "aluable items

inside their baggage but 7to a"ail of our Vcargo ser"ice8 >=$h.



718?. *t is li!e%ise to be noted that there is nothing in the

e"idence to sho% the actual "alue of the goods allegedly lost by

petitioner.

Pan Am v. !A

Ci"il La%; Common Carrier; Liability for lost of baggage; Ruling in

@ng iu "s. Court of 'ppeals sustaining the "alidity of a printed

stipulation at the bac! of an airline tic!et limiting liability of the

carrier for lost baggage to a speci#ed amount and that the

liability limited to said amount since the passenger did not

declare a higher "alue much less pay additional charges s&uarelyapplicable to the instant case.—/e #nd the ruling in @ng iu

s&uarely applicable to the instant case. *n said case the Court(

through Eustice <elencio9errera( statedF etitioner further

contends that respondent Court committed gra"e error %hen it

limited 'L0s carriage liability to the amount of 144.44 as

stipulated at the bac! of the tic!et. . . . /e agree %ith the

foregoing #nding. he pertinent Condition of Carnage printed at

the bac! of the plane tic!et readsF A B'GG'G= L*'B*L*. . . he

total liability of the Carrier for lost or damaged baggage of thepassenger is L*<*=D @ 144.44 for each tic!et unless a

passenger declares a higher "aluation in e$cess of 144.44( but

not in e$cess( ho%e"er of a total "aluation of 1(444.44 and

additional charges are paid pursuant to Carrier0s taris. here is

no dispute that petitioner did not declare any higher "alue for his

luggage( much less did he pay any additional transportation

charge.

Same; Same; Same; Same; :act that petitioner had not signed theplane tic!et he is ne"ertheless bound by the pro"isions thereof.—

/hile( it may be true that petitioner had not signed the plane

tic!et >=$h. 71)8?( he is ne"ertheless bound by the pro"isions

thereof. 7Such pro"isions ha"e been held to be a part of the

contract of carriage( and "alid and binding upon the passenger

regardless of the latter0s lac! of !no%ledge or assent to the



regulation.8 Hannebaum ". 5ational 'irline( *nc.( 1+ <isc. )d -I4(

123 5..S. )d -44; Lichten ". =astern 'irlines( A2 :ed. Supp. 31;

<igos!i ". =astern 'ir Lines( *nc.( :la.( 3+ So. )d 3+-.J *t is %hat is

!no%n as a contract of 7adhesion(8 in regards %hich it has been

said that contracts of adhesion %herein one party imposes aready made form of contract on the other( as the plane tic!et in

the case at bar( are contracts not entirely prohibited( the one %ho

adheres to the contract is in reality free to re6ect it entirely; if he

adheres( he gi"es his consent Holentino( Ci"il Code( Vol *V( 13)

ed.( p. -3)( citing <r. Eustice E.B.L. Reyes( La%yer0s Eournal( Ean.

+1( 1I1( p. -J. 'nd as held in Randolph ". 'merican 'irlines(

14+ @hio 'pp. 12)( 1-- 5.=. )d A2A; Rosenchein ". rans /orld

'irlines( *nc.( +- S./. )d -A+( 7a contract limiting liability upon

an agreed "aluation does not oend against the policy of the la%forbidding one from contracting against his o%n negligence.8

Same; Same; Same; Ruling in She%aram "s. 'L *nc. that the

stipulation limiting the carrier0s liability to a speci#ed amount %as

in"alid #nds no application in the instant case.—@n the other

hand( the ruling in She%aram ". hilippine 'ir Lines( *nc. HG.R. 5o.

L)44( Euly )( 133( 12 SCR' 343J( %here the court held that

the stipulation limiting the carrier0s liability to a speci#ed amount

%as in"alid( #nds no application in the instant case( as the rulingin said case %as premised on the #nding that the conditions

printed at the bac! of the tic!et %ere so small and hard to read

that they %ould not %arrant the presumption that the passenger

%as a%are of the conditions and that he had freely and fairly

agreed thereto. *n the instant case( similar facts that %ould ma!e

the case fall under the e$ception ha"e not been alleged( much

less sho%n to e$ist.

Same; Same; Same; Damages; Court inable to agree %ith decision

of the trial court and aKrmed by the Court of 'ppeals a%arding

pri"ate respondents damages as and for lost pro#ts.—he Court

#nds itself unable to agree %ith the decision of the trial court( and

aKrmed by the Court of 'ppeals( a%arding pri"ate respondents

damages as and for lost pro#ts %hen their contracts to sho% the

#lms in Guam and San :rancisco( California %ere cancelled. he



rule laid do%n in <endoa ". hilippine 'ir Lines( *nc. H4 hil. A+3

>1I)?J cannot be any clearerF. . . nder 'rt. 1142 of the Ci"il

Code( a debtor in good faith li!e the defendant herein( may be

held liable only for damages that %ere foreseen or might ha"e

been foreseen at the time the contract of transportation %asentered into. he trial court correctly found that the defendant

company could not ha"e foreseen the damages that %ould be

suered by <endoa upon failure to deli"er the can of #lm on the

12th of September( 1-A for the reason that the plans of <endoa

to e$hibit that #lm during the t%o #esta and his preparations(

specially the announcement of said e$hibition by posters and

ad"ertisement in the ne%spaper( %ere not called to the

defendant0s attention.

Same; Same; Same; Same; Same; etitioner cannot be held liable

for the cancellation of pri"ate respondents0 contract.—hus(

applying the foregoing ruling to the facts of the instant case( in

the absence of a sho%ing that petitioner0s attention %as called to

the special circumstances re&uiring prompt deli"ery of pri"ate

respondent angan0s luggages( petitioner cannot be held liable for

the cancellation of pri"ate respondents0 contracts as it could not

ha"e foreseen such an e"entuality %hen it accepted the luggages

for transit.Same; Same; Same; 'ttorney0s fees; '%ard of 'ttorney0s fees

losses support and must be set aside.—/ith the Court0s holding

that petitioner0s liability is limited to the amount stated in the

tic!et( the a%ard of attorney0s fees( %hich is grounded on the

alleged un6usti#ed refusal of petitioner to satisfy pri"ate

respondent0s 6ust and "alid claim( loses support and must be set

aside.

a"hay Paci#c v. A

Ci"il La%; Common Carriers; Contract of Carriage; :ailure of

common carrier to deli"er luggage of passenger at designated



place and time constitutes a breach of contract of carriage.—

etitioner breached its contract of carriage %ith pri"ate

respondent /hen it failed to deli"er his luggage at the designated

place and time( it being the obligation of a common carrier to

carry its passengers and their luggage sefely to their destination(%hich includes the duty not to delay their transportation( and the

e"idence sho%s that petitioner acted fraudulently or in bad faith.

Same; Same; Same; Same; <oral Damages; /hen reco"erable.—

<oral damages predicated upon a breach of contract of carriage

may only be reco"erable in instances %here the mishap results in

death of a passenger( or %here the carrier is guilty of fraud or bad

faith.

Same; Same; Same; Same; Same; Discourteous and arbitraryconduct of common carrier,s personnel amounts to bad faith

entitling passenger,s reco"ery for moral damages.—/hile the

mere failure of C'9' to deli"er respondent,s luggage at the

agreed place and time did not ipso facto amount to %illful

misconduct since the luggage %as e"entually deli"ered to pri"ate

respondent( albeit belatedly( /e are persuaded that the

employees of C'9' acted in bad faith. $$$ he language and

conduct of petitioner,s representati"e to%ards respondent

'lcantara %as discourteous or arbitrary to 6ustify the grant of moral damages. he C'9' representati"e %as not only

indierent and impatient; he %as also rude and insulting.

Same; Same; Same; Same; Same; *n the absence of fraud or bad

faith in breaching contract of carriage( liability of common carrier

limited to natural and probable conse&uences of said breach(

other%ise( moral and e$emplary damages are reco"erable.—

/here in breaching the contract of carriage the defendant airline

is not sho%n to ha"e acted fraudulently or in bad faith( liability fordamages is limited to the natural and probable conse&uences of

the breach of obligation %hich the parties had foreseen or could

ha"e reasonably foreseen. *n that case( such liability does not

include moral and e$emplary damages. Con"ersely( if the



defendant airline is sho%n to ha"e acted fraudulently or in bad

faith( the a%ard of moral and e$emplary damages is proper.

Same; Same; Same; Commercial La%; /arsa% Con"ention;

Recognition of /arsa% Con"ention does not preclude the

operation of the Ci"il Code and other pertinent la%s in thedetermination of e$tent of liability of common carriers in cases of

breach of contract of carriage( particularly for %illful misconduct

of their employees.—'lthough the /arsa% Con"ention has the

force and eect of la% in this country( being a treaty commitment

assumed by the hilippine go"ernment( said con"ention does not

operate as an e$clusi"e enumeration of the instances for

declaring a carrier liable for breach of contract of carriage or as

an absolute limit of the e$tent of that liability. he /arsa%

Con"ention declares the carrier liable for damages in the

enumerated cases and under certain limitations. 9o%e"er( it must

not be construed to preclude the operation of the Ci"il Code and

other pertinent la%s. *t does not regulate( much less e$empt( the

carrier from liability for damages for "iolating the rights of its

passengers under the contract of carriage( especially if %ilful

misconduct on the part of the carrier,s employees is found or

established.

Maer$k Line v. A

Ci"il rocedure; Dismissal of 'ctions; he dismissal of the

complaint in fa"or of one of the defendants resulting to the

dismissal( li!e%ise( of crossclaim against the other( does not

inure to the bene#t of the latter( being an original party

defendant.—Reacting to the foregoing declaration( petitionersubmits that since its liability is predicated on the crossclaim #led

by its codefendant =li Lilly( *nc. %hich crossclaim has been

dismissed( the original complaint against it should li!e%ise be

dismissed. /e disagree. *t should be recalled that the complaint

%as #led originally against =li Lilly( *nc. as shippersupplier and

petitioner as carrier. etitioner being an original party defendant



upon %hom the delayed shipment is imputed cannot claim that

the dismissal of the complaint against =li Lilly( *nc. inured to its

bene#t.

Ci"il La%; Common Carriers; *n the absence of an underta!ing by

a common carrier to deli"er at a gi"en date or time( deli"ery of shipment or cargo should at least be made %ithin a reasonable

time.—/hile it is true that common carriers are not obligated by

la% to carry and to deli"er merchandise( and persons are not

"ested %ith the right to prompt deli"ery( unless such common

carriers pre"iously assume the obligation to deli"er at a gi"en

date or time ><endoa ". hilippine 'ir Lines( *nc.( 4 hil. A+3

H1I)J?( deli"ery of shipment or cargo should at least be made

%ithin a reasonable time.

Same; Same; ' delay in deli"ery of gelatin capsules for use in

pharmaceutical products for a period of t%o >)? months and se"en

>2? days considered beyond the realm of reasonableness; Case at

bar.—*n the case before us( %e #nd that a delay in the deli"ery of

the goods spanning a period of t%o >)? months and se"en >2?

days falls %ay beyond the realm of reasonableness. Described as

gelatin capsules for use in pharmaceutical products( sub6ect

shipment %as deli"ered to( and left in( the possession and

custody of petitionercarrier for transport to <anila "ia @a!land(California. But through petitioner0s negligence %as mishipped to

Richmond( Virginia. etitioner0s insistence that it cannot be held

liable for the delay #nds no merit.

Same; Same; Damages; :ailure of the petitioner to e$plain cause

of delay in the deli"ery of sub6ect shipment ma!es it liable for

breach of contract of carriage through gross negligence

amounting to bad faith( entitling respondent0s reco"ery of moral

damages.—*n the case before us( %e #nd that the only e"idencepresented by petitioner %as the testimony of <r. Rolando

Ramire( a claims manager of its agent Compania General de

abacos de :ilipinas( %ho merely testi#ed on =$hs. M10 to MI0 >'C

GR CV 5o. 14+-4( p. )? and nothing else. etitioner ne"er e"en

bothered to e$plain the cause for the delay( i.e. more than t%o >)?



months( in the deli"ery of the sub6ect shipment. nder the

circumstances of the case( %e hold that petitioner is liable for

breach of contract of carriage through gross negligence

amounting to bad faith. hus( the a%ard of moral damages is

therefore proper in this case.Same; Same; Same; he une$plained mishipment of the sub6ect

goods committed by the common carrier constitutes gross

carelessness or negligence amounting to %anton misconduct

%hich 6usti#es an a%ard of e$emplary damages to the aggrie"ed

party.—*n line %ith this pronouncement( %e hold that e$emplary

damages may be a%arded to the pri"ate respondent. *n contracts(

e$emplary damages may be a%arded if the defendant acted in a

%anton( fraudulent( rec!less( oppressi"e or male"olent manner.

here %as gross negligence on the part of the petitioner in

mishipping the sub6ect goods destined for <anila but %as

ine$plicably shipped to Richmond( Virginia( .S.'. Gross

carelessness or negligence constitutes %anton misconduct(

hence( e$emplary damages may be a%arded to the aggrie"ed

party >Radio Communications of the hils.( *nc. ". Court of

'ppeals( 1I SCR' 1-2 H11J?

Same; Same; Same; 'ttorney0s fees are reco"erable since

petitioner acted %ith gross negligence amounting to bad faith.—'lthough attorney0s fees are generally not reco"erable( a party

can be held liable for such if e$emplary damages are a%arded

>'rticle ))4A( 5e% Ci"il Code?. *n the case at bar( %e hold that

pri"ate respondent is entitled to reasonable attorney0s fees since

petitioner acted %ith gross negligence amounting to bad faith.

Landingin v. A

ransportation; Common carrier; Duty of common carriers.—'

common carrier is duty bound to carry its passengers Nsafely as

far as human care and foresight can pro"ide( using the utmost



diligence of "ery cautious .persons( %ith a due regard for all the

circumstancesO, >'rticle 12II( Ci"il Code.?

Same; Same; Same; 'ccident caused by defects of motor "ehicle.

—ln Lasam "s. Smith( -I hil. 334( this Supreme Court held that

an accident caused by defects in the automobile is not a casofortuito. he rationale of the carrier,s liability is the fact that Nthe

passenger has neither the choice nor control o"er the carrier in

the selection and use of the e&uipment and appliances in use by

the carrier.

Same; Same; resumption of negligence of common carrier; 9o%

rebutted.—/hen a passenger dies or is in6ured( the presumption

is that the common carrier is at fault or that it acted negligently(

his presumption is only rebutted by proof on the carrier,s partthat it obser"ed the Ne$traordinary diligenceN re&uired in 'rticle

12++ and the Nutmost diligence of "ery cautious personsN

re&uired in 'rticle 12II.

%ece$$i"o v. Para$

1. Carriers; Liability for Damages Caused by <echanical Defects.

—/hile the carrier is not an insurer of the safety of the

passengers( it should ne"ertheless be held to ans%er for the la%s

its e&uipment if such Pa%s %ere at all disco"erable. *n this

connection( the manufacturer of the defecti"e appliance is

considered in la% the agent of the carrier( and the good repute of

the manufacturer %ill not relie"e the carrier from liability. herationale of the carrier0s liability is the fact that the passenger has

no pri"ity %ith the manufacturer of the defecti"e e&uipment;

hence( he has no remedy against him( %hile the carrier usually

has.



). Damages; <oral Damages for Breach of Contract( %hen

Reco"erable.—nder 'rticle )))4 of the ne% Ci"il Code( in case to

suits for breach of contract( moral damages are reco"erable only

%here the defendant acted fraudulently or in bad faith( and there

is none in(the case at bar. >But see Resolution on the <otion toReconsider.?

+. Carriers; <echanical Defects.—' carrier is liable to its

passengers for damages caused by mechanical defects of the

con"eyance.

-. *d.; *d.; /here *n6ury is atent( *ndemnity Cannot be Denied.—

/here the in6ury is patent and not denied( the court is

empo%ered to calculate moderate damages( although there is no

de#nite proof of the pecuniary loss suered by the in6ured party.

I. *d.; *d.; Right of 9eirs of Deceased assenger to Reco"er <oral

Damages.—*n case of accident due to a carrier0s negligence( the

heirs of a deceased passenger may reco"er moral damages( e"en

though a passenger %ho is in6ured( but manages to sur"i"e( is not

entitled to them. his special rule >'rts. 123- and ))43( 5o. +? in

case of death controls the general rule of 'rticle )))4.

3. 'ttorney0s :ees; Litigant Cannot be Depri"ed of :ee if he is

=ntitled to Reco"ery.—' litigant %ho impro"idently stipulateshigher counsel fees than those to %hich he is entitled( does not

for that reason earn the right to a larger indemnity; but( by parity

of reasoning( he should not be depri"ed of counsel fees if by la%

he is entitled to reco"er them.

PAL v. A

Common Carrier( Damages; Labor La%; ' common carrier is

re&uired to e$ercise the highest degree of care in the discharge of

its business.—etitioner is a common carrier engaged in the

business of carrying or transporting passengers or goods or both(

by land( %ater( or air( for compensation( oering their ser"ices to



the public( as de#ned in 'rt. 12+)( 5e% Ci"il Code. he la% is

clear in re&uiring a common carrier to e$ercise the highest degree

of care in the discharge of its duty and business of carriage and

transportation under 'rts. 12++( 12II and 12I3 of the 5@ Ci"il

Code.Same; Same; Same; he duty of a common carrier( li!e 'L( to

e$ercise the highest degree of diligence e$tends to passengers

and cre% members.—he duty to e$ercise the utmost diligence on

the part of common carriers is for the safety of passengers as %ell

as for the members of the cre% or the complement operating the

carrier( the airplane in the case at bar. 'nd this must be so for any

omission( lapse or neglect thereof %ill certainly result to the

damage( pre6udice( nay in6uries and e"en death to all aboard the

plane( passengers and cre% members ali!e.

Same; Same; Same; Copilot %ho sustained brain in6ury due to the

crashlanding of a 'L plane %hich %as negligently handled by the

pilot is entitled compensatory and moral damages. Such

negligence is a case of &uasidelict and e"en if construed as a

matter of employeremployee relationship( the resulting in6ury to

claimant can be traced to the bad faith of the employer 6ustifying

an a%ard of moral damages under 'rt. )))4 and 'rt. 1 of the

5e% Ci"il Code.—he grant of compensatory damages to thepri"ate respondent made by the trial court and aKrmed by the

appellate court by computing his basic salary per annum at

2I4.44 a month as basic salary and +44.44 a month for e$tra

pay for e$tra Pying time including bonus gi"en in December e"ery

year is 6usti#ed. he correct computation ho%e"er should be 2I4

plus +44 $ 1) months Q 1)(344 per annum $ 14 years Q

1)3(444.44 >not 1)4(444.44 as computed by the court a &uo?.

he further grant of increase in the basic pay of the pilots to 1

)(444 annually for 13- to 13A totalling 34(444.44 and another

1 A(444.44 as bonuses and e$tra pay for e$tra Pying time at the

same rate of +44.44 a month totals 2A(444.44. 'dding

1)3(444.44 >13- to 13A compensation? ma!es a grand total of

)4-(444.44 >not 1A(444.44 as originally computed?.



Same; Same; Same.—/e re6ect the theory of petitioner that

pri"ate respondent is not entitled to moral damages. nder the

facts found by the trial court and aKrmed by the appellate court

and under the la% and 6urisprudence cited and applied( the grant

of moral damages in the amount of I4(444.44 is proper and 6usti#ed. he fact that pri"ate respondent suered physical

in6uries in the head %hen the plane crashlanded due to the

negligence of the latter is clearly a &uasidelict and therefore

'rticle ))1( >)? 5e% Ci"il Code is applicable( 6ustifying the

reco"ery of moral damages.

Same; Same; Same; Same.—="en from the standpoint of the

petitioner that there is an employeremployee relationship

bet%een it and pri"ate respondent arising from the contract of

employment( pri"ate respondent is still entitled to moral damages

in "ie% of the #nding of bad faith or malice by the appellate court(

%hich #nding /e hereby aKrm( applying the pro"isions of 'rt.

)))4( 5e% Ci"il Code %hich pro"ides that %ilfull in6ury to property

may be a legal ground for a%arding moral damages if the court

should #nd that( under the circumstances( such damages are

6ustly due. he same rule applies to breaches of contract %here

the defendant acted fraudulently or in bad f aith.

Same; Same; Same; Same.—he 6usti#cation in the a%ard of moral damages under 'rt. 1 of the 5e% Ci"il Code on 9uman

Relations %hich re&uires that e"ery person must( in the e$ercise

of his rights and in the performance of his duties( act %ith 6ustice(

gi"e e"eryone his due( and obser"e honesty and good faith( as

applied by respondent court is also %ellta!en and /e hereby gi"e

@ur aKrmance thereto.

'ttorneys; '%ard of attorney,s fees is 6usti#ed.—/ith respect to

the a%ard of attorney,s fees in the sum of )4(444.44 the same isli!e%ise correct. 's pointed out in the decision of the Court of

'ppeals( Nthe plainti is entitled to attorney,s fees because he

%as forced to litigate in order to enforce his "alid claim >Ganaban

"s. Bayle( +4 SCR' +3I; De la Cru "s. De la Cru( )) SCR' ++;

and many others?; defendant acted in bad faith in refusing



plainti,s "alid claim >:ilipino ipe :oundry Corporation "s. Central

Ban!( )+ SCR' 14--?; and plainti %as dismissed and %as forced

to go to court to "indicate his right >5adura "s. Benguet

Consolidated( *nc.( I SCR' A2?N.

Damages; *nterest; *nterest on damages accrues from the date of 6udicial or e$tra6udicial demand.—'rticles 113( ))4 and ))1) of

the Ci"il Code go"ern %hen interest shall be computed.

hereunder interest begins to accrue upon demand( e$tra6udicial

or 6udicial. ' complaint is a 6udicial demand >Cabarroguis "s.

Vicente( 142 hil. +-4?. nder 'rticle ))1) of the Ci"il Code(

interest due shall earn legal interest from the time it is 6udicially

demanded( although the obligation may be silent upon this point.N

>C' Resolution( pp. 1I+1I-( Records?.

Sul&icio Line$ v. A

'ppeals; :indings of fact of the trial court are entitled to great

%eight and are not disturbed e$cept for cogent reasons( such as

%hen the #ndings of fact are not supported by e"idence.—

Generally( the #ndings of fact of the trial court are entitled togreat %eight and not disturbed e$cept for cogent reasons

>Gatmaitan ". Court of 'ppeals( )44 SCR' +2 H11J?. @ne of the

accepted reasons is %hen the #ndings of fact are not supported

by the e"idence >Sando"al Shipyard( *nc. ". Cla"e( - SCR' -2)

H12J?.

="idence; Damages; 'ctual or compensatory damages( to be

reco"ered( must be pro"ed( and if the proof is Pimsy( no damages

%ill be a%arded.—Corollary to this is the rule that actual or

compensatory damages( to be reco"ered( must be pro"ed;other%ise( if the proof is Pimsy( no damages %ill be a%arded

>Dichoso ". Court of 'ppeals( 1) SCR' 13 H14J?.

Same; Same; here could be no reco"ery of actual damages

%here the trial court merely mentioned the fact of the loss and

the "alue of the contents of the pieces of baggage %ithout stating



the e"idence on %hich it based its #ndings.—*n the case at bench(

the trial court merely mentioned the fact of the loss and the "alue

of the contents of the pieces of baggage %ithout stating the

e"idence on %hich it based its #ndings. here is no sho%ing that

the "alue of the contents of the lost pieces of baggage %as basedon the bill of lading or %as pre"iously declared by respondent ito

D. abu&uilde before he boarded the ship. 9ence( there can be no

basis to a%ard actual damages in the amount of )2(AI4.44.

Common Carriers; Damages; ' common carrier is liable for actual

or compensatory damages for deaths of its passengers caused by

the breach of the contract of transportation.—9o%e"er( the Ci"il

Code( in 'rticle 123- thereof( e$pressly ma!es 'rticle ))43applicable 7to the death of a passenger caused by the breach of

contract by a common carrier.8 'ccordingly( a common carrier is

liable for actual or compensatory damages under 'rticle ))43 in

relation to 'rticle 123- of the Ci"il Code for deaths of its

passengers caused by the breach of the contract of

transportation.

Same; Same; he a%ard of damages under 'rticle ))43 of the

Ci"il Code has been increased to I4(444.44.—he trial courta%arded an indemnity of +4(444.44 for the death of the

daughter of pri"ate respondents. he a%ard of damages under

'rticle ))43 has been increased to I4(444.44 >eople ". :lores(

)+2 SCR' 3I+ H1-J?.

Same; Same; *n breach of contract of carriage( moral damages

may be reco"ered %hen it results in the death of a passenger.—

/ith respect to the a%ard of moral damages( the general rule is

that said damages are not reco"erable in culpa contractual e$cept

%hen the presence of bad faith %as pro"en >rans /orld 'ir Lines". Court of 'ppeals( 13I SCR' 1-+ H1AAJ?. 9o%e"er( in breach of

contract of carriage( moral damages may be reco"ered %hen it

results in the death of a passenger >hilippine Rabbit Bus Lines(

*nc. ". =sguerra( 112 SCR' 2-1 H1A)J; Vas&ue ". Court of

'ppeals( 1+A SCR' II+ H1AIJ?.



Same; Same; 'rticle ))+) of the Ci"il Code gi"es the Court the

discretion to grant e$emplary damages %hen the defendant acted

in a %anton( fraudulent and rec!less manner.—/ith respect to the

a%ard of e$emplary damages( 'rticle ))+) of the Ci"il Code of the

hilippines gi"es the Court the discretion to grant said damages inbreach of contract %hen the defendant acted in a %anton(

fraudulent and rec!less manner >'ir :rance ". Carrascoso( 1A

SCR' 1II H133J?.

Same; Same; he Court ta!es 6udicial notice of the dreadful

regularity %ith %hich grie"ous maritime disasters occur in our

%aters %ith massi"e loss of life.—:urthermore( in the case of

<ecenas ". Court of 'ppeals( 1A4 SCR' A+ >1A?( %e ruled thatF

7$ $ $. he Court %ill ta!e 6udicial notice of the dreadful regularity

%ith %hich grie"ous maritime disasters occur in our %aters %ith

massi"e loss of life. he bul! of our population is too poor to

aord domestic air transportation. So it is that not%ithstanding

the fre&uent sin!ing of passenger "essels in our %aters( cro%ds of

people continue to tra"el by sea. his Court is prepared to use the

instruments gi"en to it by the la% for securing the ends of la% and

public policy. @ne of those instruments is the institution of

e$emplary damages; one of those ends( of special importance in

an archipelagic state li!e the hilippines( is the safe and reliablecarriage of people and goods by sea. $ $ $8

Same; Same; ' common carrier is obliged to transport its

passengers to their destinations %ith the utmost diligence of a

"ery cautious person.—' common carrier is obliged to transport

its passengers to their destinations %ith the utmost diligence of a

"ery cautious person >Laguna ayabas Bus Co. ". iongson( 13

SCR' -4 H133J?. he trial court found that petitioner failed to

e$ercise the e$traordinary diligence re&uired of a common carrier(

%hich resulted in the sin!ing of the <OV Doa <arilyn.

'a&an Airline$ v. A$uncion



ransportation; Common Carriers; 'ir ransportation; /hen an

airline issues a tic!et to a passenger( con#rmed for a particular

Pight on a certain date( a contract of carriage arises and the

passenger has e"ery right to e$pect that he be transported on

that Pight and on that date and it becomes the carrier0s obligationto carry him and his luggage safely to the agreed destination.—

nder 'rticle 12II of the Ci"il Code( a common carrier such as

E'L is bound to carry its passengers safely as far as human care

and foresight can pro"ide( using the utmost diligence of "ery

cautious persons( %ith due regard for all the circumstances. /hen

an airline issues a tic!et to a passenger( con#rmed for a particular

Pight on a certain date( a contract of carriage arises. he

passenger has e"ery right to e$pect that he be transported on

that Pight and on that date and it becomes the carrier0s obligationto carry him and his luggage safely to the agreed destination. *f

the passenger is not so transported or if in the process of

transporting he dies or is in6ured( the carrier may be held liable

for a breach of contract of carriage.

Same; Same; Same; /hile it may be true that an airline has the

duty to inspect %hether its passengers ha"e the necessary tra"el

documents( such duty does not e$tend to chec!ing the "eracity of

e"ery entry in such documents—an airline could not "ouch for theauthenticity of a passport and the correctness of the entries

therein.—/e #nd that E'L did not breach its contract of carriage

%ith respondents. *t may be true that E'L has the duty to inspect

%hether its passengers ha"e the necessary tra"el documents(

ho%e"er( such duty does not e$tend to chec!ing the "eracity of

e"ery entry in these documents. E'L could not "ouch for the

authenticity of a passport and the correctness of the entries

therein. he po%er to admit or not an alien into the country is a

so"ereign act %hich cannot be interfered %ith e"en by E'L. his isnot %ithin the ambit of the contract of carriage entered into by E'L

and herein respondents. 's such( should not be faulted for the

denial of respondents0 shore pass applications.

Same; Same; Same; Damages; /here there is no breach of

contract nor proof that an airline acted in %anton( fraudulent or



male"olent manner( there is no basis for the a%ard of any form of

damages.—<oral damages may be reco"ered in cases %here one

%illfully causes in6ury to property( or in cases of breach of

contract %here the other party acts fraudulently or in bad faith.

=$emplary damages are imposed by %ay of e$ample or correctionfor the public good( %hen the party to a contract acts in %anton(

fraudulent( oppressi"e or male"olent manner. 'ttorney0s fees are

allo%ed %hen e$emplary damages are a%arded and %hen the

party to a suit is compelled to incur e$penses to protect his

interest. here being no breach of contract nor proof that E'L

acted in %anton( fraudulent or male"olent manner( there is no

basis for the a%ard of any form of damages.

'ctions; Damages; ' person0s right to litigate should not be

penalied by holding him liable for damages.—/e #nd that the

Court of 'ppeals correctly dismissed E'L0s counterclaim for

litigation e$penses( e$emplary damages and attorney0s fees. he

action %as #led by respondents in utmost good faith and not

manifestly fri"olous. Respondents honestly belie"ed that E'L

breached its contract. ' person0s right to litigate should not be

penalied by holding him liable for damages. his is especially

true %hen the #ling of the case is to enforce %hat he belie"es to

be his rightful claim against another although found to beerroneous.

transportation law cases iii

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