Japan Airlines v Asuncion

FACTS:
Michael and Jeannette Asuncion (respondents) left Manila on board JAL bound
for Los Angeles
Their itinerary included a stopover in Narita and an overnight stay at Hotel
Nikko Narita thus the need for a shore pass, which is required of a foreigner who
desires to stay in the neighborhood of the port of call
Upon arrival, an employee of JAL endorsed the Respondents applications for
shore pass to the Japanese Immigration Official. However, Respondents
application was denied because Michael appeared to be shorter than his height
as indicated in his passport.
And so they were brought instead to the Narita Airport Rest House and were
charged $400 each for their accommodation
Respondents filed a complaint for damages claiming that
o JAL did not fully apprise them of their travel requirements
o JAL did not exhaust all means to prevent the denial of their shore pass
entry applications
o They were rudely and forcibly detained at Narita
JAL contends that the refusal of the immigration official is an act of state
which JAL cannot interfere with or prevail upon
TC and CA ruled in favor of the Respondents
ISSUE: WoN JAL is guilty of breach of contract
DECISION: NO
A contract of carriage includes the duty of JAL to inspect whether its passengers
have the necessary travel documents. HOWEVER, this duty does not extend to
checking the veracity of every entry
This is because the power to admit or not an alien into the country is a sovereign
act, which cannot be interfered with even by JAL. AS SUCH, JAL cannot vouch
for the authenticity of a passport and correctness of the entries therein
RE: JALs failure to apprise the Respondents, it must be noted that
Respondents, prior to their departure were aware of the need to secure shore
pass entries for their overnight stay at Hotel Nikko
RE: failure of JAL to exhaust all means, as mentioned, JAL has no authority
to interfere with or influence the immigration officials. The most that it could do
is to endorse the Respondents applications, which JAL immediately did upon
arrival of Respondents. IN FACT, JAL did all it could to assist them (making
reservations at the Rest House)
RE: allegations of improper behavior, it must be noted that Michaels
testimony did not categorically state those allegations
RE: claim for damages, since there is no breach of contract nor proof that JAL
acted fraudulently, there is no basis for the award of any damages

RE: claim for reimbursement (accommodation fee), it was proven that the
amount did not accrue to the benefit of JAL
May the airline be held liable for damages if a passenger was denied entry
into his country of destination/stopover owing to lack of a shore pass
required by immigration authorities?
Michael and Jeannete boarded a Japan Airlines plane bound for Los-Angeles.
As they have a stop-over in Narita, they decided to stay at the Hotel NikkoNarita. An airline staff endorsed their application for shore pass, which is
required of foreigners if they intend to stay for not more than 72 hours.
During the interview of Michael conducted by the Japanse immigration official,
the later noticed that his height seemed to be shorter than that indicated in his
passport. Their application for shore passes were denied, and they were escorted
to the Narita Airport Rest House to be billeted overnight. They were made to
stay at the hotel until their departure the next day to Los Angeles. They were
also billed US400.00 each for their stay and security service and meals.
Michael and Jeannete filed a case for damages against Japan Airlines, alleging
that JAL did not fully apprise them of their travel requirements and they rudely
and forcibly detained while at Narita.
JAL on the other hand contended that the denial of the shore passes of Michale
and Jeannete by the immigration agency of Japan was an act of state over which
they have no control. JAL also cannot impose upon the authorities not ti billet
them at the Narita Aiport Rest House.
After trial at the Regional Trial Court, the court found JAL liable for damages.
The Court of Appeals also sustained the ruling.
May the airline be held liable for the denial of the shore passes of Michael and
Jeanette?
Under Article 1755 of the Civil Code, a common carrier such as JAL is bound
to carry its passengers safely as far as human care and foresight can provide,
using the utmost diligence of very cautious persons, with due regard for all the
circumstances. When an airline issues a ticket to a passenger, confirmed for a
particular flight on a certain date, a contract of carriage arises. The passenger has
every right to expect that he be transported on that flight and on that date and it
becomes the carriers obligation to carry him and his luggage safely to the
agreed destination.10 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.11
We find that JAL did not breach its contract of carriage with respondents. It may
be true that JAL has the duty to inspect whether its passengers have the

necessary travel documents, however, such duty does not extend to checking the
veracity of every entry in these documents. JAL could not vouch for the
authenticity of a passport and the correctness of the entries therein. The power to
admit or not an alien into the country is a sovereign act which cannot be
interfered with even by JAL. This is not within the ambit of the contract of
carriage entered into by JAL and herein respondents. As such, JAL should not be
faulted for the denial of respondents shore pass applications.

WALTER SMITH & CO vs CADWALLADER

FACTS: On Aug. 30,1926, steamer Helen C, owned by Cadwallader,
commanded by Capt. Miguel Lasa struck the wharf of Walter Smith at the port
of Olutanga, Zamboanga, in the course of its maneuvers. The wharf was
partially demolished and the timber piled on it were thrown into the water.
TC held that Cadwallader was not liable since the partial demolition was
due to the excessive weight of timber piled and bad conditions of piles
supporting the wharf. The wharf was old. The steamship slightly struck the
wharf but not with such force since it was difficult for her to strike it with such
force. TC however did not make any definite findings on the negligence of the
captain.
WS infers that there was negligence on the part of the captain of ship and
that the impact of the ship with the wharf was due to the excessive force with
which the captain ordered the winches to work.
ISSUE: WON Cadwallader as owner of the steamship is liable for the damages
caused by said steamship

Thus the presumption of liability against the defendant had been overcome by
the exercise of diligence and car of a good father of the family in selecting Capt.
Lasa. Cadwallader is thus absolved from all liability.
Assumption of risk
Afialda vs Hisole
Nature: Appeal from a judgment of the CFI, Iloilo
Facts:
Afialda was employed as caretaker of defendant spouses carabaos.
While tending the animals, he was gored by one of them and later died as a
consequence of his injuries.
Plaintiff seeks to hold defendants liable under 1905:
The possessor of an animal, or the one who uses the same, is liable for any
damages it may cause, even if such animal should escapre from him or stray
away.
This liability shall cease only in case the damage should arise from force
majeure or from fault of the person who may have suffered it.

HELD: No.
RATIO: This case deals with an obligation arising from culpa aquiliana or
negligence and must be decided in accordance with Art 1902-1903.
Two things are apparent from Art 1903:
1. When an injury is caused by the negligence of a servant or employee, there
instantly arises a presumption of law that there was negligence on the part of the
master or employer either in the selection of the servant or employee or in
supervision over him after selection or both.
2. This presumption is juris tantum and not juris et de jure and consequently
may be rebutted.
In Art. 1903: "Owners or directors of any establishment or business are in the
same way liable for any damages caused by their employees while engaged in
the branch of the service in which employed or on the occasion of the
performance of their duties.
"xxx"
"the liability imposed in this article shall cease in case the persons subject
thereto prove that they exercised all the diligence of a good father of the family
to prevent the damage"
In this case, Cadwallader proved that the Capt. Lasa and all officers of Helen C
were duly licensed to hold their positions when the wharf collapsed, and they
were chosen for their reputed skill in directing and navigating the Helen C
safely, carefully and efficiently.

Issue: WON defendant spouses are liable

Held: NO
Ratio:
statute refers to possessor or user of animal
possessor or user has the custody and control of the animal and is therefore
the one in apposition to prevent it from causing damage.
One of the risks of the caretakers occupation which he had voluntarily
assumed and for which he must take the consequences
Singson vs BPI, 23 SCRA 1117
Nature: Appeal from Judgment of the CFI, Manila
Facts:
Singson was on the defendants in a civil case that ordered them to pay the sum
of 105,539.56 to Philippine Milling Co. As soon as the judgment became final
and executory, court served a writ of garnishment upon BPI-insofar as VillaAbrilles credits against bank were concerned.
Bank included Singsons account and latter discovered this when BM Glass
Service told him that the check he issued was not honored by bank becoz it had
been garnished.
Bank immediately rectified mistake, resulting in the temporary freeing of the
account of the plaintiff. Singson filed action: for damages in consequence of said

illegal freezing of account. Lower court decided that plaintiffs cannot recover
upon basis of quasi-delict because relation between parties was contractual.

ISSUE 2: Whether or not the testimony of Carrasoso regarding the note which
was not presented in court is admissible in evidence.

Issue: WON existence of contract bars commission of tort by one against the
other and the consequent recovery of damages therefor.
Held: NO
Ratio: The existence of a contract between parties does not bar the commission
of a tort by one against the other and the consequential recovery of damages
therefor.

HELD 1: Yes. It appears that Air Frances liability is based on culpa-contractual

and on culpa aquiliana.

Air France vs Carrascoso, 18 SCRA 155

ivil Law Torts and Damages Negligence Malfeasance Quasi-Delict
Remedial Law Evidence Hearsay Rule Res Gestae Startling Event
In March 1958, Rafael Carrascoso and several other Filipinos were tourists en
route to Rome from Manila. Carrascoso was issued a first class round trip ticket
by Air France. But during a stop-over in Bangkok, he was asked by the plane
manager of Air France to vacate his seat because a white man allegedly has a
better right than him. Carrascoso protested but when things got heated and
upon advise of other Filipinos on board, Carrascoso gave up his seat and was
transferred to the planes tourist class.
After their tourist trip when Carrascoso was already in the Philippines, he sued
Air France for damages for the embarrassment he suffered during his trip. In
court, Carrascoso testified, among others, that he when he was forced to take the
tourist class, he went to the planes pantry where he was approached by a plane
purser who told him that he noted in the planes journal the following:
First-class passenger was forced to go to the tourist class against his will, and
that the captain refused to intervene
The said testimony was admitted in favor of Carrascoso. The trial court
eventually awarded damages in favor of Carrascoso. This was affirmed by the
Court of Appeals.
Air France is assailing the decision of the trial court and the CA. It avers that the
issuance of a first class ticket to Carrascoso was not an assurance that he will be
seated in first class because allegedly in truth and in fact, that was not the true
intent between the parties.
Air France also questioned the admissibility of Carrascosos testimony regarding
the note made by the purser because the said note was never presented in court.
ISSUE 1: Whether or not Air France is liable for damages and on what basis.

Culpa Contractual
There exists a contract of carriage between Air France and Carrascoso. There
was a contract to furnish Carrasocoso a first class passage; Second, That said
contract was breached when Air France failed to furnish first class transportation
at Bangkok; and Third, that there was bad faith when Air Frances employee
compelled Carrascoso to leave his first class accommodation berth after he was
already, seated and to take a seat in the tourist class, by reason of which he
suffered inconvenience, embarrassments and humiliations, thereby causing him
mental anguish, serious anxiety, wounded feelings and social humiliation,
resulting in moral damages.
The Supreme Court did not give credence to Air Frances claim that the issuance
of a first class ticket to a passenger is not an assurance that he will be given a
first class seat. Such claim is simply incredible.
Culpa Aquiliana
Here, the SC ruled, even though there is a contract of carriage between Air
France and Carrascoso, there is also a tortuous act based on culpa aquiliana.
Passengers do not contract merely for transportation. They have a right to be
treated by the carriers employees with kindness, respect, courtesy and due
consideration. They are entitled to be protected against personal misconduct,
injurious language, indignities and abuses from such employees. So it is, that
any rule or discourteous conduct on the part of employees towards a passenger
gives the latter an action for damages against the carrier. Air Frances contract
with Carrascoso is one attended with public duty. The stress of Carrascosos
action is placed upon his wrongful expulsion. This is a violation of public duty
by the Air France a case of quasi-delict. Damages are proper.
HELD: 2: Yes. The testimony of Carrascoso must be admitted based on res
gestae. The subject of inquiry is not the entry, but the ouster incident. Testimony
on the entry does not come within the proscription of the best evidence rule.
Such testimony is admissible. Besides, when the dialogue between Carrascoso
and the purser happened, the impact of the startling occurrence was still fresh
and continued to be felt. The excitement had not as yet died down. Statements
then, in this environment, are admissible as part of the res gestae. The utterance
of the purser regarding his entry in the notebook was spontaneous, and related to
the circumstances of the ouster incident. Its trustworthiness has been guaranteed.
It thus escapes the operation of the hearsay rule. It forms part of the res gestae.

airplane passenger who, despite his first-class ticket, had been illegally ousted
from his first-class accommodation and compelled to take a seat in the tourist
compartment, was held entitled to recover damages from the air-carrier, upon the
ground of tort on the latters part, for, although the relation between a passenger
and a carrier is contractual both in origin and nature the act that breaks the
contract may also be a tort.
Singson vs BPI
23 SCRA 1117
FACTS: Singson, was one of the defendants in a civil case, in which judgment
had been rendered sentencing him and his co-defendants therein Lobregat and
Villa-Abrille & Co., to pay a sum of money to the plaintiff therein. Said
judgment became final and executory as only against Ville-Abrille for its failure
to file an appeal. A writ of garnishment was subsequently served upon BPI in
which the Singsons had a current account insofar as Villa-Abrilles credits
against the Bank were concerned.
Upon receipt of the said Writ of Garnishment, a clerk of the bank, upon reading
the name of the Singson in the title of the Writ of Garnishment as a party
defendants, without further reading the body and informing himself that said
garnishment was merely intended for the deposits of defendant Villa-Abrille &
Co., et al, prepared a letter informing Singson of the garnishment of his deposits
by the plaintiff in that case.
Subsequently, two checks issued by the plaintiff Julian C. Singson, one in favor
of B. M. Glass Service and another in favor of the Lega Corporation, were
dishonored by the bank. B. M. Glass Service then wrote to Singson that the
check was not honored by BPI because his account therein had already been
garnished and that they are now constrained to close his credit account with
them.
Singson wrote to BPI, claiming that his name was not included in the Writ of
Execution and Notice of Garnishment, which was served upon the bank. The
defendants lost no time to rectify the mistake that had been inadvertently
committed.
Thus this action for damages.
ISSUE: WON the existence of a contract between the parties bars a plaintiffs
claim for damages based on torts?
HELD: NO. The existence of a contract between the parties does not bar the
commission of a tort by the one against the order and the consequent recovery of
damages therefore. Indeed, this view has been, in effect, reiterated in a
comparatively recent case. Thus, in Air France vs. Carrascoso, involving an

In view, however, of the facts obtaining in the case at bar, and considering,
particularly, the circumstance, that the wrong done to the plaintiff was remedied
as soon as the President of the bank realized the mistake he and his subordinate
employee had committed, the Court finds that an award of nominal damages
the amount of which need not be proven in the sum of P1,000, in addition to
attorneys fees in the sum of P500, would suffice to vindicate plaintiffs rights.

securing it. Subsequently, the BANK gave DALCO and DAMCO up to April 1,
1953 to pay the overdue promissory note.c

PEOPLE'S BANK AND TRUST CO. vs. DAHICAN LUMBER COMPANY

G.R. No. L-17500 May 16, 1967
PEOPLE'S BANK AND TRUST CO. vs. DAHICAN LUMBER COMPANY
G.R. No. L-17500 May 16, 1967
Facts:
On September 8, 1948, Atlantic Gulf & Pacific Company of Manila, a West
Virginia corporation licensed to do business in the Philippines sold and assigned
all its rights in the Dahican Lumber concession to Dahican Lumber Company hereinafter referred to as DALCO - for the total sum of $500,000.00, of which
only the amount of $50,000.00 was paid. Thereafter, to develop the concession,
DALCO obtained various loans from the People's Bank & Trust Company
amounting, as of July 13, 1950, to P200,000.00. In addition, DALCO obtained,
through the BANK, a loan of $250,000.00 from the Export-Import Bank of
Washington D.C., evidenced by five promissory notes of $50,000.00 each,
maturing on different dates, executed by both DALCO and the Dahican America
Lumber Corporation, a foreign corporation and a stockholder of DALCO,
As security for the payment of the abovementioned loans, on July 13, 1950
DALCO executed in favor of the BANK a deed of mortgage covering five
parcels of land situated in the province of Camarines Norte together with all the
buildings and other improvements existing thereon and all the personal
properties of the mortgagor located in its place of business in the municipalities
of Mambulao and Capalonga, Camarines Norte. On the same date, DALCO
executed a second mortgage on the same properties in favor of ATLANTIC to
secure payment of the unpaid balance of the sale price of the lumber concession
amounting to the sum of $450,000.00. Both deeds contained a provision
extending the mortgage lien to properties to be subsequently acquired by the
mortgagor.
Both mortgages were registered in the Office of the Register of Deeds of
Camarines Norte. In addition thereto DALCO and DAMCO pledged to the
BANK 7,296 shares of stock of DALCO and 9,286 shares of DAMCO to secure
the same obligation.
Upon DALCO's and DAMCO's failure to pay the fifth promissory note upon its
maturity, the BANK paid the same to the Export-Import Bank of Washington
D.C., and the latter assigned to the former its credit and the first mortgage

After July 13, 1950 - the date of execution of the mortgages mentioned above DALCO purchased various machineries, equipment, spare parts and supplies in
addition to, or in replacement of some of those already owned and used by it on
the date aforesaid. Pursuant to the provision of the mortgage deeds quoted
theretofore regarding "after acquired properties," the BANK requested DALCO
to submit complete lists of said properties but the latter failed to do so. In
connection with these purchases, there appeared in the books of DALCO as due
to Connell Bros. Company (Philippines) - a domestic corporation who was
acting as the general purchasing agent of DALCO -the sum of P452,860.55 and
to DAMCO, the sum of P2,151,678.34.chan
On December 16, 1952, the Board of Directors of DALCO, in a special meeting
called for the purpose, passed a resolution agreeing to rescind the alleged sales
of equipment, spare parts and supplies by CONNELL and DAMCO to it.
On January 13, 1953, the BANK, in its own behalf and that of ATLANTIC,
demanded that said agreements be cancelled but CONNELL and DAMCO
refused to do so. As a result, on February 12, 1953; ATLANTIC and the BANK,
commenced foreclosure proceedings in the Court of First Instance of Camarines
Norte against DALCO and DAMCO.
Upon motion of the parties the Court, on September 30, 1953, issued an order
transferring the venue of the action to the Court of First Instance of Manila.
On August 30, 1958, upon motion of all the parties, the Court ordered the sale of
all the machineries, equipment and supplies of DALCO, and the same were
subsequently sold for a total consideration of P175,000.00 which was deposited
in court pending final determination of the action. By a similar agreement onehalf (P87,500.00) of this amount was considered as representing the proceeds
obtained from the sale of the "undebated properties" (those not claimed by
DAMCO and CONNELL), and the other half as representing those obtained
from the sale of the "after acquired properties".
ISSUE:
WON the "after acquired properties" were subject to the deeds of mortgage
mentioned heretofore. Assuming that they are subject thereto,
WON the mortgages are valid and binding on the properties aforesaid inspite of
the fact that they were not registered in accordance with the provisions of the
Chattel Mortgage Law.
HELD:

Under the fourth paragraph of both deeds of mortgage, it is crystal clear that all
property of every nature and description taken in exchange or replacement, as
well as all buildings, machineries, fixtures, tools, equipments, and other property
that the mortgagor may acquire, construct, install, attach; or use in, to upon, or in
connection with the premises - that is, its lumber concession - "shall
immediately be and become subject to the lien" of both mortgages in the same
manner and to the same extent as if already included therein at the time of their
execution. Such stipulation is neither unlawful nor immoral, its obvious purpose
being to maintain, to the extent allowed by circumstances, the original value of
the properties given as security.
Article 415 does not define real property but enumerates what are considered as
such, among them being machinery, receptacles, instruments or replacements
intended by owner of the tenement for an industry or works which may be
carried on in a building or on a piece of land, and shall tend directly to meet the
needs of the said industry or works. On the strength of the above-quoted legal
provisions, the lower court held that inasmuch as "the chattels were placed in the
real properties mortgaged to plaintiffs, they came within the operation of Art.
415, paragraph 5 and Art. 2127 of the New Civil Code". In the present case, the
characterization of the "after acquired properties" as real property was made not
only by one but by both interested parties. There is, therefore, more reason to
hold that such consensus impresses upon the properties the character determined
by the parties who must now be held in estoppel to question it.
Fores v. Miranda
Facts:
Respondent was one of the passengers of a jeepney driven by Eugenio Luga.
While the vehicle was descending the Sta. Mesa bridge at an excessive speed,
the driver lost control, and the jeepney swerved to the bridge wall. Serious
injuries were suffered by the defendant. The driver was charged with serious
physical injuries through reckless imprudence, and upon interposing a plea of
guilty was sentenced accordingly. Petitioner denies liability for breach of
contract of carriage, contending that a day before the accident, the jeepney was
sold to a certain Carmen Sackerman.
Issues:
(1) Is the approval of the Public Service Commission necessary for the sale of a
public service vehicle even without conveying therewith the authority to operate
the same?
(2) To what damages is the respondent entitled?
Held:

(1) Assuming the dubious sale to be a fact, the court of Appeals answered the
query in the affirmative. The ruling should be upheld. The provisions of the
statute are clear and prohibit the sale, alienation, lease, or encumbrance of the
property, franchise, certificate, privileges or rights, or any part thereof of the
owner or operator of the public service Commission. The law was designed
primarily for the protection of the public interest; and until the approval of the
public Service Commission is obtained the vehicle is, in contemplation of law,
still under the service of the owner or operator standing in the records of the
Commission which the public has a right to rely upon.
(2) The P10,000 actual damages awarded by the Court of First Instance of
Manila were reduced by the Court of Appeals to only P2,000, on the ground that
a review of the records failed to disclose a sufficient basis for the trial court's
appraisal, since the only evidence presented on this point consisted of
respondent's bare statement that his expenses and loss of income amounted to
P20,000. On the other hand, "it cannot be denied," the lower court said, "that
appellee (respondent) did incur expenses"' It is well to note further that
respondent was a painter by profession and a professor of Fine Arts, so that the
amount of P2,000 awarded cannot be said to be excessive. The attorney's fees in
the sum of P3,000 also awarded to the respondent are assailed on the ground that
the Court of First Instance did not provided for the same, and since no appeal
was interposed by said respondent, it was allegedly error for the Court of
Appeals to award them motu proprio. Petitioner fails to note that attorney's fees
are included in the concept of actual damages under the Civil Code and may be
awarded whenever the court deems it is just and equitable. We see no reason to
alter these awards.
Anent the moral damages ordered to be paid to the respondent, the same must be
discarded. We have repeatedly ruled that moral damages are not recoverable in
damage actions predicted on a breach of the contract of transportation. Where
the injured passenger does not die, moral damages are not recoverable unless it
is proved that the carrier was guilty of malice or bad faith. We think it is clear
that the mere carelessness of the carrier's driver does not per se constitute of
justify an inference of malice or bad faith on the part of the carrier; and in the
case at bar there is no other evidence of such malice to support the award of
moral damages by the Court of Appeals.