THIRD DIVISION the unused portion of the conjunction ticket from the parties herein, Philippine courts do not
ties herein, Philippine courts do not have
G.R. No. 116044-45             March 9, 2000
AMERICAN AIRLINES petitioner,
vs.
COURT OF APPEALS, HON. BERNARDO LL. SALAS
and DEMOCRITO MENDOZA, respondents.
GONZAGA-REYES, J.:
Before us is a petition for review of the decision dated
December 24, 1993 rendered by the Court of Appeals in
the consolidated cases docketed as CA-G.R. SP nos.
30946 and 31452 entitled American Airlines vs. The
Presiding Judge Branch 8 of the Regional Trial Court of
Cebu and Democrito Mendoza, petitions
for certiorari and prohibition. In SP no. 30946, the
petitioner assails the trial court's order denying the
petitioner's motion to dismiss the action for damages
filed by the private respondent for lack of jurisdiction
under section 28 (1) of the Warsaw Convention; and in
SP No. 31452 the petitioner challenges the validity of
the trial court's order striking off the record the
deposition of the petitioner's security officer taken in
Geneva, Switzerland for failure of the said security
officer to answer the cross interrogatories propounded
by the private respondent.
The sole issue raised in SP No. 30946 is the questioned
jurisdiction of the Regional Trial Court of Cebu to take
cognizance of the action for damages filed by the private
respondent against herein petitioner in view of Art 28
(1) of the Warsaw Convention. 1 It is undisputed that the
private respondent purchased from Singapore Airlines
in Manila conjunction tickets for Manila-Singapore-
Athens-Larnaca-Rome-Turin-Zurich-Geneva-
Copenhagen-New York. The petitioner was not a
participating airline in any of the segments in the
itinerary under the said conjunction tickets. In Geneva
the petitioner decided to forego his trip to Copenhagen
and to go straight to New York and in the absence of a
direct flight under his conjunction tickets from Geneva
to New York, the private respondent on June 7, 1989
exchanged the unused portion of the conjunction ticket
for a one-way ticket from Geneva to New York from the
petitioner airline. Petitioner issued its own ticket to the
private respondent in Geneva and claimed the value of
IATA 2 clearing house in Geneva.
In September 1989, private respondent filed an action
for damages before the regional trial court of Cebu for
the alleged embarrassment and mental anguish he
suffered at the Geneva Airport when the petitioner'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. The petitioner filed a motion to dismiss
for lack of jurisdiction of Philippine courts to entertain
the said proceedings under Art. 28(1) of the Warsaw
Convention. The trial court denied the motion. The
order of denial was elevated to the Court of Appeals
which affirmed the ruling of the trial court. Both the
trial and the appellate courts held that the suit may be
brought in the Philippines under the pool partnership
agreement among the IATA members, which include
Singapore Airlines and American Airlines, wherein the
members act as agents of each other in the issuance of
tickets to those who may need their services. The
contract of carriage perfected in Manila between the
private respondent and Singapore Airlines binds the
petitioner as an agent of Singapore Airlines and
considering that the petitioner has a place of business in
Manila, the third option of the plaintiff under the
Warsaw Convention i.e. the action may be brought in
the place where the contract was perfected and where
the airline has a place of business, is applicable. Hence
this petition assailing the order upholding the
jurisdiction of Philippine courts over the instant action.
Both parties filed simultaneous memoranda pursuant to
the resolution of this Court giving due course to the
petition.
The petitioner's theory is as follows: Under Art 28 (1) of
the Warsaw convention an action for damages must be
brought at the option of the plaintiff either before the
court of the 1) domicile of the carrier; 2) the carrier's
principal place of business; 3) the place where the
carrier has a place of business through which the
contract was made; 4) the place of destination. The
petitioner asserts that the Philippines is neither the
domicile nor the principal place of business of the
defendant airline; nor is it the place of destination. As
regards the third option of the plaintiff, the petitioner
contends that since the Philippines is not the place
where the contract of carriage was made between the
1 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
jurisdiction over this action for damages. The issuance
of petitioner's own ticket in Geneva in exchange for the
conjunction ticket issued by Singapore Airlines for the
final leg of the private respondent's trip gave rise to a
separate and distinct contract of carriage from that
entered into by the private respondent with Singapore
Airlines in Manila. Petitioner lays stress on the fact that
the plane ticket for a direct flight from Geneva to New
York was purchased by the private respondent from the
petitioner by "exchange and cash" which signifies that
the contract of carriage with Singapore Airlines was
terminated and a second contract was perfected.
Moreover, the second contract of carriage cannot be
deemed to have been an extension of the first as the
petitioner airline is not a participating airline in any of
the destinations under the first contract. The petitioner
claims that the private respondent's argument that the
petitioner is bound under the IATA Rules as agent of the
principal airline is irrelevant and the alleged bad faith of
the airline does not remove the case from the
applicability of the Warsaw Convention. Further the
IATA Rule cited by the private respondent which is
admittedly printed on the ticket issued by the petitioner
to him which states, "An air carrier issuing a ticket for
carriage over the lines of another carrier does so only as
its agent" does not apply herein, as neither Singapore
Airlines nor the petitioner issued a ticket to the private
respondent covering the route of the other. Since the
conjunction tickets issued by Singapore Airlines do not
include the route covered by the ticket issued by the
petitioner, the petitioner airline submits that it did not
act as an agent of Singapore Airlines.
Private respondent controverts the applicability of the
Warsaw Convention in this case. He posits that under
Article 17 of the Warsaw Convention 3 a carrier may be
held liable for damages if the "accident" occurred on
board the airline or in the course of "embarking or
disembarking" from the carrier and that under Article
25 (1) 4 thereof the provisions of the convention will not
apply if the damage is caused by the "willful
misconduct" of the carrier. He argues that his cause of
action is based on the incident at the pre-departure area
of the Geneva airport and not during the process of
embarking nor disembarking from the carrier and that
security officers of the petitioner airline acted in bad
faith. Accordingly, this case is released from the terms
of the Convention. Private respondent argues that
assuming that the Convention applies, his trip to nine
cities in different countries performed by different
carriers under the conjunction tickets issued in Manila
by Singapore Airlines is regarded as a single
transaction; as such the final leg of his trip from Geneva
to New York with the petitioner airline 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. The private respondent seeks affirmance of
the ruling of the lower courts that the petitioner acted
as an agent of Singapore Airlines under the IATA Rules
and as an agent of the principal carrier the petitioner
may be held liable under the contract of carriage
perfected in Manila, citing the judicial admission made
by the petitioner that it claimed the value of the unused
portion of the private respondent's conjunction tickets
from the IATA Clearing House in Geneva where the
accounts of both airlines are respectively credited and
debited. Accordingly, the petitioner cannot now deny
the contract of agency with Singapore Airlines after it
honored the conjunction tickets issued by the latter.
The petition is without merit.
The Warsaw Convention to which the Republic of the
Philippines is a party and which has the force and effect
of law in this country applies to all international
transportation of persons, baggage or goods performed
by an aircraft gratuitously or for hire. 5 As enumerated
in the Preamble of the Convention, one of the objectives
is "to regulate in a uniform manner the conditions of
international transportation by air". 6 The contract of
carriage entered into by the private respondent with
Singapore Airlines, and subsequently with the
petitioner, to transport him to nine cities in different
countries with New York as the final destination 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. 7 This includes section 28 (1) which
enumerates the four places where an action for
damages may be brought.
The threshold issue of jurisdiction of Philippine courts
under Art 28 (1) must first be resolved before any
pronouncements may be made on the liability of the
carrier thereunder. 8 The objections raised by the
private respondent that this case is released from the
terms of the Convention because the incident on which
this action is predicated did not occur in the process of
embarking and disembarking from the carrier under Art
17 9 and that the employees of the petitioner airline
acted with malice and bad faith under Art 25
(1) 10 pertain to the merits of the case which may be
examined only if the action has first been properly
commenced under the rules on jurisdiction set forth in
Art. 28 (1).
Art 28 (1) of the Warsaw Convention states:
Art 28 (1) 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.
There is no dispute that petitioner issued the ticket in
Geneva which was neither the domicile nor the
principal place of business of petitioner nor the
respondent's place of destination.
The question is whether the contract of transportation
between the petitioner and the private respondent
would be considered as a single operation and part of
the contract of transportation entered into by the latter
with Singapore Airlines in Manila.
Petitioner disputes the ruling of the lower court that it
is. Petitioner's main argument is that the issuance of a
new ticket in Geneva created a contract of carriage
separate and distinct from that entered by the private
respondent in Manila.
We find the petitioner's argument without merit.
Art 1(3) of the Warsaw Convention which 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
2 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
form of a single contract or a series of
contracts, and it shall not lose its 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.
The contract of carriage between the private
respondent and Singapore Airlines although performed
by different carriers under a series of airline tickets,
including that issued by the petitioner, constitutes a
single operation. Members of the IATA are under a
general pool partnership agreement wherein they act as
agent of each other in the issuance of tickets 11 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. Booking and reservation among airline
members are allowed even by telephone and it has
become an accepted practice among them. 12 A member
airline which enters into a contract of carriage
consisting of a series of trips to be performed by
different carriers is authorized to receive the fare for
the whole trip and through the required process of
interline settlement of accounts by way of the IATA
clearing house an airline is duly compensated for the
segment of the trip serviced. 13 Thus, when the
petitioner accepted the unused portion of the
conjunction tickets, entered it in the IATA clearing
house and undertook to transport the private
respondent over the route covered by the unused
portion of the conjunction tickets, i.e., Geneva to New
York, the petitioner tacitly recognized its commitment
under the IATA pool arrangement to act as agent of the
principal contracting airline, Singapore Airlines, as to
the segment of the trip the petitioner agreed to
undertake. As such, the petitioner thereby assumed the
obligation to take the place of the carrier originally
designated in the original conjunction ticket. The
petitioner's argument that it is not a designated carrier
in the original conjunction tickets and that it issued its
own ticket is not decisive of its liability. The new ticket
was simply a replacement for the unused portion of the
conjunction ticket, both tickets being for the same
amount of US$2,760 and having the same points of
departure and destination. 14 By constituting itself as an
agent of the principal carrier the petitioner's
undertaking should be taken as part of a single
operation under the contract of carriage executed by
the private respondent and Singapore Airlines in WHEREFORE, the judgment of the appellate court in CA-
Manila. G.R. SP No. 30946 is affirmed. The case is ordered
remanded to the court of origin for further proceedings.
The quoted provision of the Warsaw Convention Art. The decision of the appellate court in CA-G.R. SP. No.
1(3) clearly states that a contract of air transportation is 31452 is set aside. The deposition of the petitioner's
taken as a single operation whether it is founded on a security officer is reinstated as part of the evidence.
single contract or a series of contracts. The number of
tickets issued does not detract from the oneness of the SO ORDERED.
contract of carriage as long as the parties regard the
contract as a single operation. The evident purpose Melo, Vitug, Panganiban and Purisima, JJ., concur.
underlying this Article is to promote international air
travel by facilitating the procurement of a series of
contracts for air transportation through a single
principal and obligating different airlines to be bound
by one contract of transportation. Petitioner's
acquiescence to take the place of the original designated
carrier binds it under the contract of carriage entered
into by the private respondent and Singapore Airlines in
Manila.

The third option of the plaintiff under Art 28 (1) of the

Warsaw Convention e.g., to sue in the place of business
of the carrier wherein the contract was made, is
therefore, Manila, and Philippine courts are clothed
with jurisdiction over this case. 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.

The issue raised in SP No. 31452 which is whether or

not the trial court committed grave abuse of discretion
in ordering the deposition of the petitioner's security
officer taken in Geneva to be stricken off the record for
failure of the said security officer to appear before the
Philippine consul in Geneva to answer the cross-
interrogatories filed by the private respondent does not
have to be resolved. The subsequent appearance of the
said security officer before the Philippine consul in
Geneva on September 19, 1994 and the answer to the
cross-interrogatories propounded by the private
respondent was transmitted to the trial court by the
Philippine consul in Geneva on September 23,
1994 15 should be deemed as full compliance with the
requisites of the right of the private respondent to
cross-examine the petitioner's witness. The deposition
filed by the petitioner should be reinstated as part of
the evidence and considered together with the answer
to the cross-interrogatories.

3 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
 THIRD DIVISION
court as follows:
G.R. No. 150094             August 18, 2004
FEDERAL EXPRESS CORPORATION, petitioner,
vs.
AMERICAN HOME ASSURANCE COMPANY and
PHILAM INSURANCE COMPANY, INC., respondents.
DECISION
PANGANIBAN,  J.:
Basic is the requirement that before suing to recover
loss of or damage to transported goods, the plaintiff
must give the carrier notice of the loss or damage,
within the period prescribed by the Warsaw Convention
and/or the airway bill.
The Case
Before us is a Petition for Review 1 under Rule 45 of the
Rules of Court, challenging the June 4, 2001
Decision2 and the September 21, 2001 Resolution 3 of the
Court of Appeals (CA) in CA-GR CV No. 58208. The
assailed Decision disposed as follows:
"WHEREFORE, premises considered, the
present appeal is hereby DISMISSED for lack
of merit. The appealed Decision of Branch 149
of the Regional Trial Court of Makati City
in Civil Case No. 95-1219, entitled 'American
Home Assurance Co. and PHILAM Insurance Co.,
Inc. v. FEDERAL EXPRESS CORPORATION
and/or CARGOHAUS, INC. (formerly U-
WAREHOUSE, INC.),' is
hereby AFFIRMED and REITERATED.
"Costs against the [petitioner and Cargohaus,
Inc.]."4
The assailed Resolution denied petitioner's Motion for
Reconsideration.
The Facts
The antecedent facts are summarized by the appellate
"On January 26, 1994, SMITHKLINE Beecham
(SMITHKLINE for brevity) of Nebraska, USA
delivered to Burlington Air Express
(BURLINGTON), an agent of [Petitioner]
Federal Express Corporation, a shipment of
109 cartons of veterinary biologicals for
delivery to consignee SMITHKLINE and French
Overseas Company in Makati City, Metro
Manila. The shipment was covered by
Burlington Airway Bill No. 11263825 with the
words, 'REFRIGERATE WHEN NOT IN
TRANSIT' and 'PERISHABLE' stamp marked on
its face. That same day, Burlington insured the
cargoes in the amount of $39,339.00 with
American Home Assurance Company (AHAC).
The following day, Burlington turned over the
custody of said cargoes to Federal Express
which transported the same to Manila. The
first shipment, consisting of 92 cartons arrived
in Manila on January 29, 1994 in Flight No.
0071-28NRT and was immediately stored at
[Cargohaus Inc.'s] warehouse. While the
second, consisting of 17 cartons, came in two
(2) days later, or on January 31, 1994, in Flight
No. 0071-30NRT which was likewise
immediately stored at Cargohaus' warehouse.
Prior to the arrival of the cargoes, Federal
Express informed GETC Cargo International
Corporation, the customs broker hired by the
consignee to facilitate the release of its cargoes
from the Bureau of Customs, of the impending
arrival of its client's cargoes.
"On February 10, 1994, DARIO C. DIONEDA
('DIONEDA'), twelve (12) days after the
cargoes arrived in Manila, a non-licensed
custom's broker who was assigned by GETC to
facilitate the release of the subject cargoes,
found out, while he was about to cause the
release of the said cargoes, that the same
[were] stored only in a room with two (2) air
conditioners running, to cool the place instead
of a refrigerator. When he asked an employee
of Cargohaus why the cargoes were stored in
the 'cool room' only, the latter told him that
the cartons where the vaccines were
4 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
contained specifically indicated therein that it
should not be subjected to hot or cold
temperature. Thereafter, DIONEDA, upon
instructions from GETC, did not proceed with
the withdrawal of the vaccines and instead,
samples of the same were taken and brought
to the Bureau of Animal Industry of the
Department of Agriculture in the Philippines
by SMITHKLINE for examination wherein it
was discovered that the 'ELISA reading of
vaccinates sera are below the positive
reference serum.'
"As a consequence of the foregoing result of
the veterinary biologics test, SMITHKLINE
abandoned the shipment and, declaring 'total
loss' for the unusable shipment, filed a claim
with AHAC through its representative in the
Philippines, the Philam Insurance Co., Inc.
('PHILAM') which recompensed SMITHKLINE
for the whole insured amount of THIRTY NINE
THOUSAND THREE HUNDRED THIRTY NINE
DOLLARS ($39,339.00). Thereafter,
[respondents] filed an action for damages
against the [petitioner] imputing negligence
on either or both of them in the handling of the
cargo.
"Trial ensued and ultimately concluded on
March 18, 1997 with the [petitioner] being
held solidarily liable for the loss as follows:
'WHEREFORE, judgment is hereby
rendered in favor of [respondents]
and [petitioner and its Co-Defendant
Cargohaus] are directed to pay
[respondents], jointly and severally,
the following:
1. Actual damages in the
amount of the peso
equivalent of US$39,339.00
with interest from the time
of the filing of the complaint
to the time the same is fully
paid.
 2. Attorney's fees in the
amount of P50,000.00 and
3. Costs of suit.
'SO ORDERED.'
"Aggrieved, [petitioner] appealed to [the CA]." 5
Ruling of the Court of Appeals
The Test Report issued by the United States Department
of Agriculture (Animal and Plant Health Inspection
Service) was found by the CA to be inadmissible in
evidence. Despite this ruling, the appellate court held
that the shipping Receipts were a prima facie proof that
the goods had indeed been delivered to the carrier in
good condition. We quote from the ruling as follows:
"Where the plaintiff introduces evidence
which shows prima facie  that the goods were
delivered to the carrier in good condition [i.e.,
the shipping receipts], and that the carrier
delivered the goods in a damaged condition, a
presumption is raised that the damage
occurred through the fault or negligence of the
carrier, and this casts upon the carrier the
burden of showing that the goods were not in
good condition when delivered to the carrier,
or that the damage was occasioned by some
cause excepting the carrier from absolute
liability. This the [petitioner] failed to
discharge. x x x."6
Found devoid of merit was petitioner's claim that
respondents had no personality to sue. This argument
was supposedly not raised in the Answer or during trial.
Hence, this Petition.7
The Issues
In its Memorandum, petitioner raises the following
issues for our consideration:
"I.
Are the decision and resolution of the
Honorable Court of Appeals proper subject for
review by the Honorable Court under Rule 45
of the 1997 Rules of Civil Procedure?
"II.
Is the conclusion of the Honorable Court of
Appeals – petitioner's claim that respondents
have no personality to sue because the
payment was made by the respondents to
Smithkline when the insured under the policy
is Burlington Air Express is devoid of merit –
correct or not?
"III.
Is the conclusion of the Honorable Court of
Appeals that the goods were received in good
condition, correct or not?
"IV.
Are Exhibits 'F' and 'G' hearsay evidence, and
therefore, not admissible?
"V.
Is the Honorable Court of Appeals correct in
ignoring and disregarding respondents' own
admission that petitioner is not liable? and
"VI.
Is the Honorable Court of Appeals correct in
ignoring the Warsaw Convention?" 8
Simply stated, the issues are as follows: (1) Is the
Petition proper for review by the Supreme Court? (2) Is
Federal Express liable for damage to or loss of the
insured goods?
This Court's Ruling
The Petition has merit.
5 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
Preliminary Issue:
Propriety of Review
The correctness of legal conclusions drawn by the Court
of Appeals from undisputed facts is a question of law
cognizable by the Supreme Court.9
In the present case, the facts are undisputed. As will be
shown shortly, petitioner is questioning the conclusions
drawn from such facts. Hence, this case is a proper
subject for review by this Court.
Main Issue:
Liability for Damages
Petitioner contends that respondents have no
personality to sue -- thus, no cause of action against it --
because the payment made to Smithkline was
erroneous.
Pertinent to this issue is the Certificate of
Insurance10 ("Certificate") that both opposing parties
cite in support of their respective positions. They differ
only in their interpretation of what their rights are
under its terms. The determination of those rights
involves a question of law, not a question of fact. "As
distinguished from a question of law which exists 'when
the doubt or difference arises as to what the law is on a
certain state of facts' -- 'there is a question of fact when
the doubt or difference arises as to the truth or the
falsehood of alleged facts'; or when the 'query
necessarily invites calibration of the whole evidence
considering mainly the credibility of witnesses,
existence and relevancy of specific surrounding
circumstance, their relation to each other and to the
whole and the probabilities of the situation.'" 11
Proper Payee
The Certificate specifies that loss of or damage to the
insured cargo is "payable to order x x x upon surrender
of this Certificate." Such wording conveys the right of
collecting on any such damage or loss, as fully as if the
property were covered by a special policy in the name
of the holder itself. At the back of the Certificate appears
the signature of the representative of Burlington. This
document has thus been duly indorsed in blank and is
deemed a bearer instrument.
Since the Certificate was in the possession of
Smithkline, the latter had the right of collecting or of
being indemnified for loss of or damage to the insured
shipment, as fully as if the property were covered by a
special policy in the name of the holder. Hence, being
the holder of the Certificate and having an insurable
interest in the goods, Smithkline was the proper payee
of the insurance proceeds.
Subrogation
Upon receipt of the insurance proceeds, the consignee
(Smithkline) executed a subrogation Receipt 12 in favor
of respondents. The latter were thus authorized "to file
claims and begin suit against any such carrier, vessel,
person, corporation or government." Undeniably, the
consignee had a legal right to receive the goods in the
same condition it was delivered for transport to
petitioner. If that right was violated, the consignee
would have a cause of action against the person
responsible therefor.
Upon payment to the consignee of an indemnity for the
loss of or damage to the insured goods, the insurer's
entitlement to subrogation pro tanto -- being of the
highest equity -- equips it with a cause of action in case
of a contractual breach or negligence. 13 "Further, the
insurer's subrogatory right to sue for recovery under
the bill of lading in case of loss of or damage to the
cargo is jurisprudentially upheld."14
In the exercise of its subrogatory right, an insurer may
proceed against an erring carrier. To all intents and
purposes, it stands in the place and in substitution of
the consignee. A fortiori, both the insurer and the
consignee are bound by the contractual stipulations
under the bill of lading.15
Prescription of Claim
From the initial proceedings in the trial court up to the
present, petitioner has tirelessly pointed out that
respondents' claim and right of action are already
barred. The latter, and even the consignee, never filed
with the carrier any written notice or complaint
regarding its claim for damage of or loss to the subject
cargo within the period required by the Warsaw
Convention and/or in the airway bill. Indeed, this fact
has never been denied by respondents and is plainly
evident from the records.
Airway Bill No. 11263825, issued by Burlington as agent
of petitioner, states:
"6. No action shall be maintained in the case of
damage to or partial loss of the shipment
unless a written notice, sufficiently describing
the goods concerned, the approximate date of
the damage or loss, and the details of the
claim, is presented by shipper or consignee to
an office of Burlington within (14) days from
the date the goods are placed at the disposal of
the person entitled to delivery, or in the case
of total loss (including non-delivery) unless
presented within (120) days from the date of
issue of the [Airway Bill]."16
Relevantly, petitioner's airway bill states:
"12./12.1 The person entitled to delivery must
make a complaint to the carrier in writing in
the case:
12.1.1 of visible damage to the goods,
immediately after discovery of the damage
and at the latest within fourteen (14) days
from receipt of the goods;
12.1.2 of other damage to the goods, within
fourteen (14) days from the date of receipt of
the goods;
12.1.3 delay, within twenty-one (21) days of
the date the goods are placed at his disposal;
and
12.1.4 of non-delivery of the goods, within one
hundred and twenty (120) days from the date
of the issue of the air waybill.
12.2 For the purpose of 12.1 complaint in
writing may be made to the carrier whose air
waybill was used, or to the first carrier or to
the last carrier or to the carrier who
performed the transportation during which
the loss, damage or delay took place." 17
6 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
Article 26 of the Warsaw Convention, on the other hand,
provides:
"ART. 26. (1) Receipt by the person entitled to
the delivery of baggage or goods without
complaint shall be prima facie evidence that
the same have been delivered in good
condition and in accordance with the
document of transportation.
(2) 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.
(3) Every complaint must be made in writing
upon the document of transportation or by
separate notice in writing dispatched within
the times aforesaid.
(4) Failing complaint within the times
aforesaid, no action shall lie against the
carrier, save in the case of fraud on his part." 18
Condition Precedent
In this jurisdiction, the filing of a claim with the carrier
within the time limitation therefor actually constitutes a
condition precedent to the accrual of a right of action
against a carrier for loss of or damage to the
goods.19 The shipper or consignee must allege and prove
the fulfillment of the condition. If it fails to do so, no
right of action against the carrier can accrue in favor of
the former. The aforementioned requirement is a
reasonable condition precedent; it does not constitute a
limitation of action.20
The requirement of giving notice of loss of or injury to
the goods is not an empty formalism. The fundamental
reasons for such a stipulation are (1) to inform the
carrier that the cargo has been damaged, and that it is
being charged with liability therefor; and (2) to give it
an opportunity to examine the nature and extent of the
injury. "This protects the carrier by affording it an
opportunity to make an investigation of a claim while
the matter is fresh and easily investigated so as to
safeguard itself from false and fraudulent claims."21

When an airway bill -- or any contract of carriage for

that matter -- has a stipulation that requires a notice of
claim for loss of or damage to goods shipped and the
stipulation is not complied with, its enforcement can be
prevented and the liability cannot be imposed on the
carrier. To stress, notice is a condition precedent, and
the carrier is not liable if notice is not given in
accordance with the stipulation. 22 Failure to comply
with such a stipulation bars recovery for the loss or
damage suffered.23

Being a condition precedent, the notice must precede a

suit for enforcement.24 In the present case, there is
neither an allegation nor a showing of respondents'
compliance with this requirement within the prescribed
period. While respondents may have had a cause of
action then, they cannot now enforce it for their failure
to comply with the aforesaid condition precedent.

In view of the foregoing, we find no more necessity to

pass upon the other issues raised by petitioner.

We note that respondents are not without recourse.

Cargohaus, Inc. -- petitioner's co-defendant in
respondents' Complaint below -- has been adjudged by
the trial court as liable for, inter alia, "actual damages in
the amount of the peso equivalent of US $39,339." 25 This
judgment was affirmed by the Court of Appeals and is
already final and executory.26

WHEREFORE, the Petition is GRANTED, and the

assailed Decision REVERSED  insofar as it pertains to
Petitioner Federal Express Corporation. No
pronouncement as to costs.

SO ORDERED.

Corona, and Carpio-Morales, JJ., concur.

Sandoval-Gutierrez, J., on leave.

7 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
 THIRD DIVISION
G.R. No. 151783             July 8, 2003
VICTORINO SAVELLANO, VIRGINIA B. SAVELLANO
and DEOGRACIAS B. SAVELLANO, petitioners,
vs.
NORTHWEST AIRLINES, respondent.
PANGANIBAN, J.:
When, as a result of engine malfunction, a commercial
airline is unable to ferry its passengers on the original
contracted route, it nonetheless has the duty of fulfilling
its responsibility of carrying them to their contracted
destination on the most convenient route possible.
Failing in this, it cannot just unilaterally shuttle them,
without their consent, to other routes or stopping
places outside of the contracted sectors. However,
moral damages cannot be awarded without proof of the
carrier's bad faith, ill will, malice or wanton conduct.
Neither will actual damages be granted in the absence
of convincing and timely proof of loss. But nominal
damages may be allowed under the circumstances in
the case herein.
The Case
Before the Court is a Petition for Review under Rule 45
of the Rules of Court, seeking to set aside the June 29,
2001 Decision1 of the Court of Appeals2 (CA) in CA-GR
CV No. 47165. The dispositive part of the Decision
reads:
"WHEREFORE, the judgment of July 29, 1994
is hereby REVERSED and SET ASIDE and
another rendered DISMISSING [petitioners']
Complaint. No pronouncement as to costs." 3
On the other hand, the dispositive portion of
the Regional Trial Court (RTC) Decision4 that
was reversed by the CA disposed thus:
"WHEREFORE, premises considered, decision
is hereby rendered in favor of the plaintiffs
and against the defendant, sentencing the
latter to pay to the former, the following
amounts:
1. P500,000.00 as actual damages;
2. P3,000,000.00 as moral damages;
3. P500,000.00 as exemplary
damages; and
4. P500,000.00 as attorney's fees;
"All such sums shall bear legal interest, i.e., 6%
per annum pursuant to Article 2209 of the
Civil Code (Reformina vs. Tomol, 139 SCRA
260) from the date of the filing of the
complaint until fully paid. Costs against the x x
x Northwest Airlines, Inc.
"[Respondent's] counterclaim is ordered
dismissed, for lack of merit."5
The Facts
The facts of the case are summarized by the CA as
follows:
"[Petitioner] Victorino Savellano (Savellano)
was a Cabugao, Ilocos Sur mayor for many
terms, former Chairman of the Commission on
Elections and Regional Trial Court (RTC)
judge. His wife, [Petitioner] Virginia is a
businesswoman and operates several rural
banks in Ilocos Sur. The couple's x x x son
[Petitioner] Deogracias was, at the time [of]
the incident subject of the case, the Vice-
Governor of Ilocos Sur.
"On October 27, 1991, at around 1:45 p.m.,
[petitioners] departed from San Francisco,
USA on board Northwest Airlines (NW) Flight
27, Business Class, bound for Manila,
Philippines using the NW round-trip tickets
which were issued at [respondent's] Manila
ticketing office.
8 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
"[Petitioners] were expected to arrive at the
Ninoy Aquino International Airport (NAIA),
Manila on October 29, 1991 (Manila time) or
after twelve (12) hours of travel.
"After being airborne for approximately two
and one-half (2½) hours or at about 4:15 p.m.
of the same day, October 27, 1991 (Seattle,
USA time), NW Flight 27's pilot made an
emergency landing in Seattle after announcing
that a fire had started in one of the plane's
engines.
"[Petitioners] and the other passengers
proceeded to Gate 8 of the Seattle Airport
where they were instructed to go home to
Manila the next day, 'using the same boarding
passes with the same seating arrangements'.
"[Respondent's] shuttle bus thereafter brought
all passengers to the Seattle Red Lion Hotel
where they were billeted by, and at the
expense of [respondent].
"[Petitioners] who were travelling as a family
were assigned one room at the hotel. At
around 12:00 midnight, they were awakened
by a phone call from [respondent's] personnel
who advised them to be at the Seattle Airport
by 7:00 a.m. (Seattle time) the following day,
October 28, 1991, for departure. To reach the
airport on time, the NW shuttle bus fetched
them early, making them skip the 6:30 a.m.
hotel breakfast.
"Prior to leaving the hotel, however,
[petitioners] met at the lobby Col. Roberto
Delfin, a Filipino co-passenger who was also
travelling Business Class, who informed them
that he and some passengers were leaving the
next day, October 29, 1991, on board the same
plane with the same itinerary.
"On account of the 'engine failure' of the plane,
[petitioner] Virginia developed nervousness.
On getting wind of information that they were
'bumped off', she took 'valium' to calm her
nerves and 'cough syrup' for the fever and
colds she had developed during the trip.
"When [petitioners] reached the Seattle
Airport, [respondent's] ground stewardess
belatedly advised them that instead of flying to
Manila they would have to board NW Flight
94, a DC-10 plane, bound for a 3-hour flight to
Los Angeles for a connecting flight to Manila.
When [Petitioner] Savellano insisted theirs
was a direct flight to Manila, the female
ground stewardess just told them to hurry up
as they were the last passengers to board.
"In Los Angeles, [petitioners] and the other
passengers became confused for while 'there
was a sort of a board' which announced a
Seoul-Bangkok flight, none was posted for a
Manila flight. It was only after they
complained to the NW personnel that the
latter 'finally changed the board to include
Manila.'
"Before boarding NW Flight 23 for Manila via
Seoul, [petitioners] encountered another
problem. Their three small handcarried items
which were not padlocked as they were
merely closed by zippers were 'not allowed' to
be placed inside the passengers' baggage
compartments of the plane by an arrogant NW
ground stewardess.
"On [petitioners'] arrival at the NAIA, Manila
where they saw Col. Delfin and his wife as well
as the other passengers of the distressed flight
who unlike them [petitioners] who left Seattle
on October 28, 1991, left Seattle on October
29, 1991, they were teased for taking the
longer and tiresome route to the Philippines.
"When [petitioners] claimed their luggage at
the baggage carousel, they discovered that the
would-have-been handcarried items which
were not allowed to be placed inside the
passengers' baggage compartment had been
ransacked and the contents thereof stolen.
Virginia was later to claim having lost her
diamond earrings costing P300,000.00, two
(2) Perry Gan shoes worth US$250.00, four (4)
watches costing US$40.00 each, two (2) pieces
of Tag Heuer watch and three (3) boxes of
Elizabeth Arden [perfumes]. Deogracias, on
the other hand, claimed to have lost two (2)
pairs of Cole Haan shoes which he bought for
his wife, and the clothes, camera, personal
computer, and jeans he bought for his
children.
"By letter of November 22, 1991, [petitioners]
through counsel demanded from [respondent]
the amount of P3,000,000.00 as damages for
what they claimed to be the humiliation and
inconvenience they suffered in the hands of its
personnel. [Respondent] did not accede to the
demand, however, impelling [petitioners] to
file a case for damages at the RTC of Cabugao,
Ilocos Sur — subject of the present appeal.
"[Petitioners] concede that they were not
downgraded in any of the flights on their way
home to Manila. Their only complaint is that
they suffered inconvenience, embarrassment,
and humiliation for taking a longer route.
"During the trial, the [RTC], on motion of
[petitioners], issued on October 29, 1993 a
subpoena duces tecum directing [respondent]
to submit the passengers' manifest of the
distressed flight from San Francisco to Tokyo
on October 27, 1991, the passengers' manifest
of the same distressed plane from Seattle to
Tokyo which took off on October 29, 1991, and
the passenger manifest of the substitute plane
from Seattle to Los Angeles and Los Angeles to
Seoul enroute to Manila which took off on
October 28, 1991.
"The subpoena duces tecum was served on
December 1, 1993 but was not complied with,
however, by [respondent], it proffering that its
Minneapolis head office retains documents
only for one year after which they are
destroyed.
9 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
" x x x Branch 24 of the RTC of Cabugao, Ilocos
Sur rendered judgment in favor of
[petitioners] x x x.
"In granting moral and actual damages to
[petitioners], the [RTC] credited [petitioners']
claim 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
handcarried [luggage], the [RTC], passing on
the lack of receipts covering the same, took
judicial notice of the Filipinos' practice of often
bringing home pasalubong for friends and
relatives."6
Ruling of the Court of Appeals
The CA ruled that petitioners had failed to show
respondent's bad faith, negligence or malice in
transporting them via the Seattle-Los Angeles-Seoul-
Manila route. Hence, it held that there was no basis for
the RTC's award of moral and exemplary damages.
Neither did it find any reason to grant attorney's fees.
It further ruled:
"[Petitioners'] testimonial claim of losses is
unsupported by any other evidence at all. It is
odd and even contrary to human experience
for [petitioner] Virginia not to have taken out a
P300,000.00 pair of diamond earrings from an
unlocked small luggage after such luggage was
not allowed to be placed inside the
passenger's baggage compartment, given the
ease with which it could have been done as the
small luggage was merely closed by zipper.
Just as it is odd why no receipts for alleged
purchases for valuable pasalubongs including
Tag Huer watches, camera and personal
computer were presented x x x "7
Thus, even the trial court's award of actual damages
was reversed by the appellate court.
Hence this Petition.8
Issues
In their appeal, petitioners ask this Court to rule on
these issues:
" x x x [W]hether or not petitioners'
discriminatory bump-off from NW Flight No.
0027 on 28 October 1991 (not the diversion of
the distressed plane to Seattle the day
before, i.e. NW Flight 27 on 27 October 1991)
constitutes breach by respondent airline of its
air-carriage contract?
"And if so, whether or not petitioners are
entitled to actual, moral and exemplary
damages — including attorney's fees — as a
consequence?"9
The Court's Ruling
The Petition is partly meritorious.
First Issue:
Breach of Contract
Petitioners' contract of carriage with Northwest was for
the San Francisco-Tokyo (Narita)-Manila flights
scheduled for October 27, 1991. This itinerary was not
followed when the aircraft used for the first segment of
the journey developed engine trouble. Petitioners stress
that they are questioning, not the cancellation of the
original itinerary, but its substitution, which they
allegedly had not contracted for or agreed to. They
insist that, like the other passengers of the distressed
flight, they had the right to be placed on Flight 27, which
had a connecting flight from Japan to Manila. They add
that in being treated differently and shabbily, they were
being discriminated against.
A contract is the law between the parties. 10 Thus, in
determining whether petitioners' rights were violated,
we must look into its provisions, which are printed on
the airline ticket. Condition 9 in the agreement states
that a " x x x [c]arrier may without notice substitute
alternate carriers or aircraft, and may alter or omit
stopping places shown on the ticket in case of necessity.
x x x ."11
The basis of the Complaint was the way respondent
allegedly treated petitioners like puppets that could be
shuttled to Manila via Los Angeles and Seoul without
their consent.12 Undeniably, it did not take the time to
explain how it would be meeting its contractual
obligation to transport them to their final destination.
Its employees merely hustled the confused petitioners
into boarding one plane after another without giving
the latter a choice from other courses of action that
were available. It unilaterally decided on the most
expedient way for them to reach their final destination.
Passengers' Consent
After an examination of the conditions printed on the
airline ticket, we find nothing there authorizing
Northwest to decide unilaterally, after the distressed
flight landed in Seattle, what other stopping
places petitioners should take and when they should fly.
True, Condition 9 on the ticket allowed respondent to
substitute alternate carriers or aircraft without notice.
However, nothing there permits shuttling passengers —
without so much as a by your-leave — to stopping
places that they have not been previously notified 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 in the contract, being one of adhesion,
should be construed against the party that caused its
preparation — in this case, respondent. 13 Since the
conditions enumerated on the ticket do not specifically
allow it to change stopping places or to fly the
passengers to alternate connecting cities without
consulting them, then it must be construed to mean that
such unilateral change was not permitted.
Proof of Necessity of Alteration
Furthermore, the change in petitioners' flight itinerary
does not fall under the situation covered by the phrase
"may alter or omit stopping places shown on the ticket
in case of necessity." 14 A case of necessity must first be
proven. The burden of proving it necessarily fell on
respondent. This responsibility it failed to discharge.
Petitioners do not question the stop in Seattle, so we
will not delve into this matter. The airplane engine
10 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
trouble that developed during the flight bound for
Tokyo from San Francisco definitely merited the
"necessity" of landing the plane at some place for repair
— in this case, Seattle — but not that of shuttling
petitioners to other connecting points thereafter
without their consent.
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 whatsoever was given
to petitioners as to why they were not similarly allowed
to do so. It may be that the Northwest connecting flight
from Seattle to Tokyo to Manila could no longer
accommodate them. Yet it may also be that there were
other carriers that could have accommodated them for
these sectors of their journey, and whose route they
might have preferred to the more circuitous one
unilaterally chosen for them by respondent.
In the absence of evidence as to the actual situation, the
Court is hard pressed to determine if there was a "case
of necessity" sanctioning the alteration of the Tokyo
stopping place in the case of petitioners. Thus, we hold
that in the absence of a demonstrated necessity thereof
and their rerouting to Los Angeles and Seoul as
stopping places without their consent, respondent
committed a breach of the contract of carriage.
Second Issue:
Damages
Being guilty of a breach of their contract, respondent
may be held liable for damages suffered by petitioners
in accordance with Articles 1170 and 2201 of the Civil
Code, which state:
"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." (Emphasis 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 non-performance of the obligation."
As a general rule, the factual findings of the CA when
supported by substantial evidence on record are final
and conclusive and may not be reviewed on appeal. 15 An
exception to this rule is when the lower court and the
CA arrive at different factual findings. 16 In this case, the
trial court found the presence of bad faith and hence
awarded moral and exemplary damages; while the CA
found none and hence deleted the award of damages.
Thus, the Court is now behooved to review the basis for
sustaining the award or deletion of damages.
Petitioners impute oppression, discrimination,
recklessness and malevolence to respondent. We are
not convinced. There is no persuasive evidence that
they were maliciously singled out to fly the Seattle-Los
Angeles-Seoul-Manila route. It appears that the
passengers of the distressed flight were randomly
divided into two groups. One group was made to take
the Tokyo-Manila flight; and the other, the Los Angeles-
Seoul-Manila flight. The selection of who was to take
which flight was handled via the computer reservation
system, which took into account only the passengers'
final destination.17
The records show that respondent was impelled by
sincere motives to get petitioners to their final
destination by whatever was the most expeditious
course — in its judgment, if not in theirs. Though they
claim that they were not accommodated on Flight 27
from Seattle to Tokyo because respondent had taken on
Japanese passengers, petitioners failed to present
convincing evidence to back this allegation. In the
absence of convincing evidence, we cannot find
respondent guilty of bad faith.
Lopez, Zulueta and Ortigas Rulings Not Applicable
Petitioners cite the cases of Lopez v. Pan American
World Airways,18 Zulueta v. Pan American World
Airways, Inc.19 and Ortigas Jr. v. Lufthansa German
Airlines20 to support their claim for moral and
exemplary damages.
In Lopez, Honorable Fernando Lopez, then an
incumbent senator and former Vice President of the
Philippines — together with his wife, his daughter and
his son-in-law — made first-class reservations with the
Pan American World Airways on its Tokyo-San
Francisco flight. The reservation having been
confirmed, first-class tickets were subsequently issued
in their favor. Mistakenly, however, defendant's agent
cancelled the reservation. But expecting other
cancellations before the flight scheduled a month later,
the reservations supervisor decided to withhold the
information from them, with the result that upon arrival
in Tokyo, the Lopezes discovered they had no first-class
accommodations. Thus, they were compelled to take the
tourist class, just so the senator could be on time for his
pressing engagements in the United States.
In the light of these facts, the Court held there was a
breach of the contract of carriage. The failure of the
defendant to inform the plaintiffs on time that their
reservations for the first class had long been cancelled
was considered as the element of bad faith entitling
them to moral damages for the contractual breach.
According to the Court, such omission had placed them
in a predicament that enabled the company to keep
them as — their passengers in the tourist class. Thus,
the defendant was able to retain the business and to
promote its self-interest at the expense of
embarrassment, discomfort and humiliation on their
part.
In Zulueta, the passenger was coming home to Manila
from Honolulu via a Pan-American flight. The plane had
a stopover at Wake Island, where Rafael Zulueta went
down to relieve himself. At flight time, he could not be
located immediately. Upon being found, an altercation
ensued between him and the Pan-Am employees. One of
them remonstrated: "What in the hell do you think you
are? Get on that plane." An exchange of angry words
followed, and the pilot went to the extent of referring to
the Zuluetas as "those monkeys." Subsequently, for his
"belligerent" attitude, Rafael Zulueta was intentionally
off-loaded and left at Wake Island with the prospect of
being stranded there for a week, with malice
aforethought. The Court awarded to the Zuluetas
P500,000.00 as moral damages, P200,000.00 as
11 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
exemplary damages and P75,000.00 as attorney's fees,
apart from the actual damages of P5,502.85.
In Ortigas, Francisco Ortigas Jr. had a confirmed and
validated first-class ticket for Lufthansa's Flight No. 646.
His reserved first class seat was, however, given to a
Belgian. As a result, he was forced to take economy class
on the same flight. Lufthansa succeeded in keeping him
as a passenger by assuring him that he would be given
first-class accommodation at the next stop. The proper
arrangements therefor had supposedly been made
already, when in truth such was not the case. In
justifying the award of moral and exemplary damages,
the Court explained.
" x x x [W]hen it comes to contracts of
common carriage, inattention and lack of care
on the part of the carrier resulting in the
failure of the passenger to be accommodated
in the class contracted for amounts to bad
faith or fraud which entitles the passenger to
the award of moral damages in accordance
with Article 2220 of the Civil Code. But in the
instant case, the breach appears to be of
graver nature, since the preference given to
the Belgian passenger over plaintiff was done
willfully and in wanton disregard of plaintiff's
rights and his dignity as a human being and as
a Filipino, who may not be discriminated
against with impunity."
To summarize, in Loipez 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.
These cases are different from and inapplicable to the
present case. Here, there is no showing that the breach
of contract was done with the same entrepreneurial
motive or self-interest as in Lopez or with ill will as
in Zulueta and Ortigas. Petitioners have failed to show
convincingly that they were rerouted by respondent to
Los Angeles and Seoul because of malice, profit motive
or self-interest. Good faith is presumed, while bad faith
is a matter of fact that needs to be proved 21 by the party
alleging it.
In the absence of bad faith, ill will, malice or wanton
conduct, respondent cannot be held liable for moral
damages. Article 2219 of the Civil Code 22 enumerates
the instances in which moral damages may be awarded.
In a breach of contract, such damages are not awarded if
the defendant is not shown to have acted fraudulently
or with malice or bad faith. 23 Insufficient to warrant the
award of moral damages is the fact that complainants
suffered economic hardship, or that they worried and
experienced mental anxiety.24
Neither are exemplary damages proper in the present
case. The Civil Code provides that "[i]n contracts and
quasi-contracts, the court may award exemplary
damages if the defendant acted in a wanton, fraudulent,
reckless, oppressive, or malevolent
manner."25 Respondent has not been proven to have
acted in that manner. At most, it can only be found
guilty of having acted without first considering and
weighing all other possible courses of actions it could
have taken, and without consulting petitioners and
securing their consent to the new stopping places.
The unexpected and sudden requirement of having to
arrange the connecting flights of every single person in
the distressed plane in just a few hours, in addition to
the Northwest employees' normal workload, was
difficult to satisfy perfectly. We cannot find respondent
liable for exemplary damages for its imperfection of
neglecting to consult with the passengers beforehand.
Nevertheless, herein petitioners will not be
totally deprived of compensation. Nominal
damages may be awarded as provided by the
Civil Code, from which we quote:
"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."
Nominal damages are recoverable if no actual,
substantial or specific damages were shown to have
resulted from the breach.26 The amount of such
damages is addressed to the sound discretion of the
court, taking into account the relevant circumstances. 27
In the present case, we must consider that petitioners
suffered the inconvenience of having to wake up early
after a bad night and having to miss breakfast; as well as
the fact that they were business class passengers. They
paid more for better service; thus, rushing them and
making them miss their small comforts was not a trivial
thing. We also consider their social and official status.
Victorino Savellano was a former mayor, regional trial
court judge and chairman of the Commission on
Elections. Virginia B. Savellano was the president of five
rural banks, and Deogracias Savellano was then the
incumbent vice governor of Ilocos Sur. Hence, it will be
proper to grant one hundred fifty thousand pesos
(P150,000) as nominal damages 28 to each of them, in
order to vindicate and recognize their right 29 to be
notified and consulted before their contracted stopping
place was changed.
A claim for the alleged lost items from the baggage of
petitioners cannot prosper, because they failed to give
timely notice of the loss to respondent. The Conditions
printed on the airline ticket plainly read:
"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.
xxx             xxx             xxx
"7. Checked baggage will be delivered to
bearer of the baggage check. In case of damage
to baggage moving in international
transportation complaint must be made in
writing to carrier forthwith after discovery of
damage, and at the latest, within 7 days from
receipt; in case of delay, complaint must be
made within 21 days from date the baggage
was delivered. x x x ."30
12 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
The pertinent provisions of the Rules Relating to
International Carriage by Air (Warsaw Convention)
state:
"Article 26
1. Receipt by the person entitled to delivery of
luggage or goods without complaint is prima
facie evidence that the same have been
delivered in good condition and in accordance
with the document of carriage.
2. 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 three days from the
date of receipt in the case of luggage and seven
days from date of receipt in the case of goods.
In the case of delay the complaint must be
made at the latest within fourteen days from
the date on which the luggage or goods have
been placed at his disposal.
3. Every complaint must be made in writing
upon the document of carriage or by separate
notice in writing dispatched within the times
aforesaid.
4. Failing complaint within the times aforesaid,
no action shall lie against the carrier, save in
the case of fraud on his part."
After allegedly finding that their luggage had been
ransacked, petitioners never lodged a complaint with
any Northwest airport personnel. Neither did they
mention the alleged loss of their valuables in their
November 22, 1991 demand letter.31 Hence, in
accordance with the parties' contract of carriage, no
claim can be heard or admitted against respondent with
respect to alleged damage to or loss of petitioners'
baggage.
WHEREFORE, the Petition is hereby PARTIALLY
GRANTED, and the assailed Decision MODIFIED.
Respondent is ORDERED to pay one hundred fifty
thousand pesos (P150,000) to each of the three
petitioners as nominal damages. No. pronouncement as
to costs.
SO ORDERED.

Puno, Sandoval-Gutierrez and Corona, JJ ., concur.

Carpio-Morales, J ., took no part.

13 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
 Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 171092               March 15, 2010
EDNA DIAGO LHUILLIER, Petitioner,
vs.
BRITISH AIRWAYS, Respondent.
DECISION
DEL CASTILLO, J.:
Jurisdictio est potestas de publico introducta cum
necessitate juris dicendi. Jurisdiction is a power
introduced for the public good, on account of the
necessity of dispensing justice.1
Factual Antecedents
On April 28, 2005, petitioner Edna Diago Lhuillier filed a
Complaint2 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 lecturing on 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, petitioner complained to
respondent’s ground manager and demanded an
apology. However, the latter declared that the flight
stewards were "only doing their job."
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.
On May 16, 2005, summons, together with a copy of the
complaint, was served on the respondent through
Violeta Echevarria, General Manager of Euro-Philippine
Airline Services, Inc.3
On May 30, 2005, respondent, by way of special
appearance through counsel, filed a Motion to
Dismiss4 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, 5 Article
28(1) of which provides:
An action for damages must be brought at the option of
the plaintiff, either before the court of domicile of the
carrier or his principal place of business, or where he
has a place of business through which the contract has
been made, or before the court of the place of
destination.
Thus, since a) respondent is domiciled in London; b)
respondent’s principal place of business is in London; c)
petitioner bought her ticket in Italy (through Jeepney
Travel S.A.S, in Rome);6 and d) Rome, Italy is
petitioner’s place of destination, then it follows that the
complaint should only be filed in the proper courts of
London, United Kingdom or Rome, Italy.
Likewise, it was alleged that the case must be dismissed
for lack of jurisdiction over the person of the
14 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
respondent because the summons was erroneously
served on Euro-Philippine Airline Services, Inc. which is
not its resident agent in the Philippines.
On June 3, 2005, the trial court issued an Order
requiring herein petitioner to file her
Comment/Opposition on the Motion to Dismiss within
10 days from notice thereof, and for respondent to file a
Reply thereon.7 Instead of filing a Comment/Opposition,
petitioner filed on June 27, 2005, an Urgent Ex-Parte
Motion to Admit Formal Amendment to the Complaint
and Issuance of Alias Summons.8 Petitioner alleged that
upon verification with the Securities and Exchange
Commission, she found out that the resident agent of
respondent in the Philippines is Alonzo Q. Ancheta.
Subsequently, on September 9, 2005, petitioner filed a
Motion to Resolve Pending Incident and Opposition to
Motion to Dismiss.9
Ruling of the Regional Trial Court
On October 14, 2005, the RTC of Makati City, Branch
132, issued an Order10 granting respondent’s Motion to
Dismiss. It ruled that:
The Court sympathizes with the alleged ill-treatment
suffered by the plaintiff. However, our Courts have to
apply the principles of international law, and are bound
by treaty stipulations entered into by the Philippines
which form part of the law of the land. One of this is the
Warsaw Convention. Being a signatory thereto, the
Philippines adheres to its stipulations and is bound by
its provisions including the place where actions
involving damages to plaintiff is to be instituted, as
provided for under Article 28(1) thereof. The Court
finds no justifiable reason to deviate from the indicated
limitations as it will only run counter to the provisions
of the Warsaw Convention. Said adherence is in
consonance with the comity of nations and deviation
from it can only be effected through proper
denunciation as enunciated in the Santos case (ibid).
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 plaintiff’s ticket issued in this
country nor was her destination Manila but Rome in
Italy. It bears stressing however, that referral to the
court of proper jurisdiction does not constitute
constructive denial of plaintiff’s right to have access to
our courts since the Warsaw Convention itself provided
for jurisdiction over cases arising from international
transportation. Said treaty stipulations must be
complied with in good faith following the time honored
principle of pacta sunt servanda.
The resolution of the propriety of service of summons is
rendered moot by the Court’s want of jurisdiction over
the instant case.
WHEREFORE, premises considered, the present Motion
to Dismiss is hereby GRANTED and this case is hereby
ordered DISMISSED.
Petitioner filed a Motion for Reconsideration but the
motion was denied in an Order11 dated January 4, 2006.
Petitioner now comes directly before us on a Petition
for Review on Certiorari on pure questions of law,
raising the following issues:
Issues
I. WHETHER X X X 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 FOREIGN COUNTRY; AND THUS IS
OUTSIDE THE AMBIT OF THE WARSAW CONVENTION.
II. WHETHER x x x RESPONDENT AIR CARRIER OF
PASSENGERS, IN FILING ITS MOTION TO DISMISS
BASED ON LACK OF JURISDICTION OVER THE SUBJECT
MATTER OF THE CASE AND OVER ITS PERSON MAY BE
DEEMED AS HAVING IN FACT AND IN LAW SUBMITTED
ITSELF TO THE JURISDICTION OF THE LOWER COURT,
ESPECIALLY SO, WHEN THE VERY LAWYER ARGUING
FOR IT IS HIMSELF THE RESIDENT AGENT OF THE
CARRIER.
Petitioner’s Arguments
Petitioner argues that her cause of action arose not
from the contract of carriage, but from the tortious
conduct committed by airline personnel of respondent
in violation of the provisions of the Civil Code on Human
Relations. Since her cause of action was not predicated
on the contract of carriage, petitioner asserts that she
has the option to pursue this case in this jurisdiction
pursuant to Philippine laws.
Respondent’s Arguments
In contrast, respondent maintains that petitioner’s
claim for damages fell within the ambit of Article 28(1)
of the Warsaw Convention. As such, the same can only
be filed before the courts of London, United Kingdom or
Rome, Italy.
Our Ruling
The petition is without merit.
The Warsaw Convention has the force and effect of law
in this country.
It is settled that the Warsaw Convention has the force
and effect of law in this country. In Santos III v.
Northwest Orient Airlines,12 we held that:
The Republic of the Philippines is a party to the
Convention for the Unification of Certain Rules Relating
to International Transportation by Air, otherwise
known as the Warsaw Convention. It took effect on
February 13, 1933. The Convention was concurred in by
the Senate, through its Resolution No. 19, on May 16,
1950. The Philippine instrument of accession was
signed by President Elpidio Quirino on October 13,
1950, and was deposited with the Polish government on
November 9, 1950. The Convention became applicable
to the Philippines on February 9, 1951. On September
23, 1955, President Ramon Magsaysay issued
Proclamation No. 201, declaring our formal adherence
thereto, "to the end that the same and every article and
clause thereof may be observed and fulfilled in good
faith by the Republic of the Philippines and the citizens
thereof."
The Convention is thus a treaty commitment voluntarily
assumed by the Philippine government and, as such, has
the force and effect of law in this country. 13
The Warsaw Convention applies because the air travel,
where the alleged tortious conduct occurred, was
15 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
between the United Kingdom and Italy, which are both
signatories to the Warsaw Convention.
Article 1 of the Warsaw Convention provides:
1. This Convention applies to all international
carriage of persons, luggage or goods
performed by aircraft for reward. It applies
equally to gratuitous carriage by aircraft
performed by an air transport undertaking.
2. For the purposes of this Convention the
expression "international carriage" means any
carriage 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 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 a territory subject to the
sovereignty, suzerainty, mandate or authority
of another Power, even though that Power is
not a party to this Convention. A carriage
without such an agreed stopping place
between territories subject to the sovereignty,
suzerainty, mandate or authority of the same
High Contracting Party is not deemed to be
international for the purposes of this
Convention. (Emphasis supplied)
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
carriage 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.14
In the case at bench, petitioner’s place of departure was
London, United Kingdom while her place of destination
was Rome, Italy.15 Both the United Kingdom16 and
Italy17 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.
Since the Warsaw Convention applies in the instant
case, then the jurisdiction over the subject matter of the
action is governed by the provisions of the Warsaw
Convention.
Under Article 28(1) of the Warsaw Convention, the
plaintiff may bring the action for damages before –
1. the court where the carrier is domiciled;
2. the court where the carrier has its principal
place of business;
3. the court where the carrier has an
establishment by which the contract has been
made; or
4. the court of the place of destination.
In this case, it is not disputed that 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 of Rome 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, petitioner may bring
her action 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.
Santos III v. Northwest Orient Airlines 18 applies in this
case.
Petitioner contends that Santos III v. Northwest Orient
Airlines19 cited by the trial court is inapplicable to the
present controversy since the facts thereof are not
similar with the instant case.
We are not persuaded.
In Santos III v. Northwest Orient Airlines, 20 Augusto
Santos III, a resident of the Philippines, purchased a
ticket from Northwest Orient Airlines in San Francisco,
for transport between San Francisco and Manila via
Tokyo and back to San Francisco. He was wait-listed in
the Tokyo to Manila segment of his ticket, despite his
prior reservation. Contending that Northwest Orient
Airlines acted in bad faith and discriminated against
him when it canceled his confirmed reservation and
gave his seat to someone who had no better right to it,
Augusto Santos III sued the carrier for damages before
the RTC. Northwest Orient Airlines moved to dismiss
the complaint on ground of lack of jurisdiction citing
Article 28(1) of the Warsaw Convention. The trial court
granted the motion which ruling was affirmed by the
Court of Appeals. When the case was brought before us,
we denied the petition holding that under Article 28(1)
of the Warsaw Convention, Augusto Santos III must
prosecute his claim in the United States, that place being
the (1) domicile of the Northwest Orient Airlines; (2)
principal office of the carrier; (3) place where contract
had been made (San Francisco); and (4) place of
destination (San Francisco).21
We further held that Article 28(1) of the Warsaw
Convention is jurisdictional in character. Thus:
A number of reasons tends to support the
characterization of Article 28(1) as a jurisdiction and
not a venue provision. First, the wording of Article 32,
which indicates the places where the action for
damages "must" be brought, underscores the
mandatory nature of Article 28(1). Second, this
characterization is consistent with one of the objectives
of the Convention, which is to "regulate in a uniform
manner the conditions of international transportation
by air." Third, the Convention does not contain any
provision prescribing rules of jurisdiction other than
Article 28(1), which means that the phrase "rules as to
jurisdiction" used in Article 32 must refer only to Article
28(1). In fact, the last sentence of Article 32 specifically
deals with the exclusive enumeration in Article 28(1) as
"jurisdictions," which, as such, cannot be left to the will
of the parties regardless of the time when the damage
occurred.
xxxx
16 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
In other words, where the matter is governed by the
Warsaw Convention, jurisdiction takes on a dual
concept. Jurisdiction in the international sense must be
established in accordance with Article 28(1) of the
Warsaw Convention, following which the jurisdiction of
a particular court must be established pursuant to the
applicable domestic law. Only after the question of
which court has jurisdiction is determined will the issue
of venue be taken up. This second question shall be
governed by the law of the court to which the case is
submitted.22
Contrary to the contention of petitioner, Santos III v.
Northwest Orient Airlines23 is analogous to the instant
case because (1) the domicile of respondent is London,
United Kingdom;24 (2) the principal office of respondent
airline is likewise in London, United Kingdom; 25 (3) the
ticket was purchased in Rome, Italy; 26 and (4) the place
of destination is Rome, Italy.27 In addition, petitioner
based her complaint on Article 2176 28 of the Civil Code
on quasi-delict and Articles 1929 and 2130 of the Civil
Code on Human Relations. In Santos III v. Northwest
Orient Airlines,31 Augusto Santos III similarly posited
that Article 28 (1) of the Warsaw Convention did not
apply if the action is based on tort. Hence, contrary to
the contention of the petitioner, the factual setting of
Santos III v. Northwest Orient Airlines 32 and the instant
case are parallel on the material points.
Tortious conduct as ground for the petitioner’s
complaint is within the purview of the Warsaw
Convention.
Petitioner contends that in Santos III v. Northwest
Orient Airlines,33 the cause of action was based on a
breach of contract while her cause of action arose from
the tortious conduct of the airline personnel and
violation of the Civil Code provisions on Human
Relations.34 In addition, she claims that our
pronouncement in Santos III v. Northwest Orient
Airlines35 that "the allegation of willful misconduct
resulting in a tort is insufficient to exclude the case from
the comprehension of the Warsaw Convention," is more
of an obiter dictum rather than the ratio
decidendi.36 She maintains that the fact that said acts
occurred aboard a plane is merely incidental, if not
irrelevant.37
We disagree with the position taken by the petitioner.
Black defines obiter dictum as "an opinion entirely
unnecessary for the decision of the case" and thus "are
not binding as precedent." 38 In Santos III v. Northwest
Orient Airlines,39 Augusto Santos III categorically put in
issue the applicability of Article 28(1) of the Warsaw
Convention if the action is based on tort.
In the said case, we held that the allegation of willful
misconduct resulting in a tort is insufficient to exclude
the case from the realm of the Warsaw Convention. In
fact, our ruling that a cause of action based on tort did
not bring the case outside the sphere of the Warsaw
Convention was our ratio decidendi in disposing of the
specific issue presented by Augusto Santos III. Clearly,
the contention of the herein petitioner that the said
ruling is an obiter dictum is without basis.
Relevant to this particular issue is the case of Carey v.
United Airlines,40 where the passenger filed an action
against the airline arising from an incident involving the
former and the airline’s flight attendant during an
international flight resulting to a heated exchange
which included insults and profanity. The United States
Court of Appeals (9th Circuit) held that the "passenger's
action against the airline carrier arising from alleged
confrontational incident between passenger and flight
attendant on international flight was governed
exclusively by the Warsaw Convention, even though the
incident allegedly involved intentional misconduct by
the flight attendant."41
In Bloom v. Alaska Airlines,42 the passenger brought
nine causes of action against the airline in the state
court, arising from a confrontation with the flight
attendant during an international flight to Mexico. The
United States Court of Appeals (9th Circuit) held that
the "Warsaw Convention governs actions arising from
international air travel and provides the exclusive
remedy for conduct which falls within its provisions." It
further held that the said Convention "created no
exception for an injury suffered as a result of intentional
conduct" 43 which in that case involved a claim for
intentional infliction of emotional distress.
It is thus settled that allegations of tortious conduct
committed against an airline passenger during the
course of the international carriage do not bring the
case outside the ambit of the Warsaw Convention.
Respondent, in seeking remedies from the trial court
through special appearance of counsel, is not deemed to
have voluntarily submitted itself to the jurisdiction of
the trial court.
Petitioner argues that respondent has effectively
submitted itself to the jurisdiction of the trial court
when the latter stated in its Comment/Opposition to the
Motion for Reconsideration that "Defendant [is at a loss]
x x x how the plaintiff arrived at her erroneous
impression that it is/was Euro-Philippines Airlines
Services, Inc. that has been making a special appearance
since x x x British Airways x x x has been clearly
specifying in all the pleadings that it has filed with this
Honorable Court that it is the one making a special
appearance."44
In refuting the contention of petitioner, respondent
cited La Naval Drug Corporation v. Court of
Appeals45 where we held that even if a party "challenges
the jurisdiction of the court over his person, as by
reason of absence or defective service of summons, and
he also invokes other grounds for the dismissal of the
action under Rule 16, he is not deemed to be in estoppel
or to have waived his objection to the jurisdiction over
his person."46
This issue has been squarely passed upon in the recent
case of Garcia v. Sandiganbayan, 47 where we reiterated
our ruling in La Naval Drug Corporation v. Court of
Appeals48 and elucidated thus:
Special Appearance to Question a Court’s Jurisdiction Is
Not
Voluntary Appearance
The second sentence of Sec. 20, Rule 14 of the Revised
Rules of Civil Procedure clearly provides:
Sec. 20. Voluntary appearance. – The defendant’s
voluntary appearance in the action shall be equivalent
to service of summons. The inclusion in a motion to
dismiss of other grounds aside from lack of jurisdiction
over the person of the defendant shall not be deemed a
voluntary appearance.
17 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
Thus, a defendant who files a motion to dismiss,
assailing the jurisdiction of the court over his person,
together with other grounds raised therein, is not
deemed to have appeared voluntarily before the court.
What the rule on voluntary appearance – the first
sentence of the above-quoted rule – means is that the
voluntary appearance of the defendant in court is
without qualification, in which case he is deemed to
have waived his defense of lack of jurisdiction over his
person due to improper service of summons.
The pleadings filed by petitioner in the subject
forfeiture cases, however, do not show that she
voluntarily appeared without qualification. Petitioner
filed the following pleadings in Forfeiture I: (a) motion
to dismiss; (b) motion for reconsideration and/or to
admit answer; (c) second motion for reconsideration;
(d) motion to consolidate forfeiture case with plunder
case; and (e) motion to dismiss and/or to quash
Forfeiture I. And in Forfeiture II: (a) motion to dismiss
and/or to quash Forfeiture II; and (b) motion for partial
reconsideration.
The foregoing pleadings, particularly the motions to
dismiss, were filed by petitioner solely for special
appearance with the purpose of challenging the
jurisdiction of the SB over her person and that of her
three children. Petitioner asserts therein that SB did not
acquire jurisdiction over her person and of her three
children for lack of valid service of summons through
improvident substituted service of summons in both
Forfeiture I and Forfeiture II. This stance the petitioner
never abandoned when she filed her motions for
reconsideration, even with a prayer to admit their
attached Answer Ex Abundante Ad Cautelam dated
January 22, 2005 setting forth affirmative defenses with
a claim for damages. And the other subsequent
pleadings, likewise, did not abandon her stance and
defense of lack of jurisdiction due to improper
substituted services of summons in the forfeiture cases.
Evidently, from the foregoing Sec. 20, Rule 14 of the
1997 Revised Rules on Civil Procedure, petitioner and
her sons did not voluntarily appear before the SB
constitutive of or equivalent to service of summons.
Moreover, the leading La Naval Drug Corp. v. Court of
Appeals applies to the instant case. Said case elucidates
the current view in our jurisdiction that a special
appearance before the court––challenging its
jurisdiction over the person through a motion to
dismiss even if the movant invokes other grounds––is
not tantamount to estoppel or a waiver by the movant
of his objection to jurisdiction over his person; and such
is not constitutive of a voluntary submission to the
jurisdiction of the court.1avvphi1

Thus, it cannot be said that petitioner and her three

children voluntarily appeared before the SB to cure the
defective substituted services of summons. They are,
therefore, not estopped from questioning the
jurisdiction of the SB over their persons nor are they
deemed to have waived such defense of lack of
jurisdiction. Consequently, there being no valid
substituted services of summons made, the SB did not
acquire jurisdiction over the persons of petitioner and
her children. And perforce, the proceedings in the
subject forfeiture cases, insofar as petitioner and her
three children are concerned, are null and void for lack
of jurisdiction. (Emphasis supplied)

In this case, the special appearance of the counsel of

respondent in filing the Motion to Dismiss and other
pleadings before the trial court cannot be deemed to be
voluntary submission to the jurisdiction of the said trial
court. We hence disagree with the contention of the
petitioner and rule that there was no voluntary
appearance before the trial court that could constitute
estoppel or a waiver of respondent’s objection to
jurisdiction over its person.

WHEREFORE, the petition is DENIED. The October 14,

2005 Order of the Regional Trial Court of Makati City,
Branch 132, dismissing the complaint for lack of
jurisdiction, is AFFIRMED.

SO ORDERED.

MARIANO C. DEL CASTILLO

Associate Justice

18 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
 Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 149547             July 4, 2008
PHILIPPINE AIRLINES, INC., petitioner,
vs.
HON. ADRIANO SAVILLO, Presiding Judge of RTC
Branch 30 , Iloilo City, and SIMPLICIO
GRIÑO, respondents.
DECISION
CHICO-NAZARIO, J.:
This is a Petition for Review on Certiorari under Rule 45
of the Rules of Court, assailing the Decision 1 dated 17
August 2001, rendered by the Court of Appeals in CA-
G.R. SP No. 48664, affirming in toto the Order2 dated 9
June 1998, of Branch 30 of the Regional Trial Court
(RTC) of Iloilo City, dismissing the Motion to Dismiss
filed by petitioner Philippine Airlines Inc. (PAL) in the
case entitled, Simplicio Griño v. Philippine Airlines, Inc.
and Singapore Airlines, docketed as Civil Case No.
23773.
PAL is a corporation duly organized under Philippine
law, engaged in the business of providing air carriage
for passengers, baggage and cargo.3
Public respondent Hon. Adriano Savillo is the presiding
judge of Branch 30 of the Iloilo RTC, where Civil Case
No. 23773 was filed; while private respondent Simplicio
Griñ o is the plaintiff in the aforementioned case.
The facts are undisputed.
Private respondent was invited to participate in the
1993 ASEAN Seniors Annual Golf Tournament held in
Jakarta, Indonesia. He and several companions decided
to purchase their respective passenger tickets from PAL
with the following points of passage: MANILA-
SINGAPORE-JAKARTA-SINGAPORE-MANILA. Private
respondent and his companions were made to
understand by PAL that its plane would take them from
Manila to Singapore, while Singapore Airlines would
take them from Singapore to Jakarta.4
On 3 October 1993, private respondent and his
companions took the PAL flight to Singapore and
arrived at about 6:00 o’clock in the evening. Upon their
arrival, they proceeded to the Singapore Airlines office
to check-in for their flight to Jakarta scheduled at 8:00
o’clock in the same evening. Singapore Airlines rejected
the tickets of private respondent and his group because
they were not endorsed by PAL. It was explained to
private respondent and his group that if Singapore
Airlines honored the tickets without PAL’s
endorsement, PAL would not pay Singapore Airlines for
their passage. Private respondent tried to contact PAL’s
office at the airport, only to find out that it was closed. 5
Stranded at the airport in Singapore and left with no
recourse, private respondent was in panic and at a loss
where to go; and was subjected to humiliation,
embarrassment, mental anguish, serious anxiety, fear
and distress. Eventually, private respondent and his
companions were forced to purchase tickets from
Garuda Airlines and board its last flight bound for
Jakarta. When they arrived in Jakarta at about 12:00
o’clock midnight, the party who was supposed to fetch
them from the airport had already left and they had to
arrange for their transportation to the hotel at a very
late hour. After the series of nerve-wracking
experiences, private respondent became ill and was
unable to participate in the tournament. 6
Upon his return to the Philippines, private respondent
brought the matter to the attention of PAL. He sent a
demand letter to PAL on 20 December 1993 and
another to Singapore Airlines on 21 March 1994.
However, both airlines disowned liability and blamed
each other for the fiasco. On 15 August 1997, private
respondent filed a Complaint for Damages before the
RTC docketed as Civil Case No. 23773, seeking
compensation for moral damages in the amount
of P1,000,000.00 and attorney’s fees.7
Instead of filing an answer to private respondent’s
Complaint, PAL filed a Motion to Dismiss 8 dated 18
September 1998 on the ground that the said complaint
19 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
was barred on the ground of prescription under Section
1(f) of Rule 16 of the Rules of Court. 9 PAL argued that
the Warsaw Convention,10 particularly Article 29
thereof,11 governed this case, as it provides that any
claim for damages in connection with the international
transportation of persons is subject to the prescription
period of two years. Since the Complaint was filed on 15
August 1997, more than three years after PAL received
the demand letter on 25 January 1994, it was already
barred by prescription.
On 9 June 1998, the RTC issued an Order12 denying the
Motion to Dismiss. It maintained that the provisions of
the Civil Code and other pertinent laws of the
Philippines, not the Warsaw Convention, were
applicable to the present case.
The Court of Appeals, in its assailed Decision dated 17
August 2001, likewise dismissed the Petition for
Certiorari filed by PAL and affirmed the 9 June 1998
Order of the RTC. It pronounced that the application of
the Warsaw Convention must not be construed to
preclude the application of the Civil Code and other
pertinent laws. By applying Article 1144 of the Civil
Code,13 which allowed for a ten-year prescription
period, the appellate court declared that the Complaint
filed by private respondent should not be dismissed.14
Hence, the present Petition, in which petitioner raises
the following issues:
I
THE COURT OF APPEALS ERRED IN NOT
GIVING DUE COURSE TO THE PETITION AS
RESPONDENT JUDGE COMMITED GRAVE
ABUSE OF DISCRETION AMOUNTING TO LACK
OF JURSIDICTION IN DENYING PAL’S MOTION
TO DISMISS.
II
THE COURT OF APPEALS ERRED IN NOT
APPLYING THE PROVISIONS OF THE
WARSAW CONVENTION DESPITE THE FACT
THAT GRIÑ O’S CAUSE OF ACTION AROSE
 FROM A BREACH OF CONTRACT FOR
INTERNATIONAL AIR TRANSPORT.
III
THE COURT OF APPEALS ERRED IN NOT
HOLDING THAT THE COMPLAINT FILED BY
GRIÑ O BEYOND THE TWO (2)-YEAR PERIOD
PROVIDED UNDER THE WARSAW
CONVENTION IS ALREADY BARRED BY
PRESCRIPTION.15
The petition is without merit.
In determining whether PAL’s Motion to Dismiss should
have been granted by the trial court, it must be
ascertained if all the claims made by the private
respondent in his Complaint are covered by the Warsaw
Convention, which effectively bars all claims made
outside the two-year prescription period provided
under Article 29 thereof. If the Warsaw Convention
covers all of private respondent’s claims, then Civil Case
No. 23773 has already prescribed and should therefore
be dismissed. On the other hand, if some, if not all, of
respondent’s claims are outside the coverage of the
Warsaw Convention, the RTC may still proceed to hear
the case.
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. 16 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. 17
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.
Nevertheless, this Court notes that jurisprudence in the
Philippines and the United States also recognizes that
the Warsaw Convention does not "exclusively regulate"
the relationship between passenger and carrier on an
international flight. This Court finds that the present
case is substantially similar to cases in which the
damages sought were considered to be outside the
coverage of the Warsaw Convention.
In United Airlines v. Uy,18 this Court distinguished
between the (1) damage to the passenger’s baggage and
(2) humiliation he suffered at the hands of the airline’s
employees. The first cause of action was covered by the
Warsaw Convention which prescribes in two years,
while the second was covered by the provisions of the
Civil Code on torts, which prescribes in four years.
Similar distinctions were made in American
jurisprudence. In Mahaney v. Air France,19 a passenger
was denied access to an airline flight between New York
and Mexico, despite the fact that she held a confirmed
reservation. The court therein ruled that if the plaintiff
were to claim damages based solely on the delay she
experienced – for instance, the costs of renting a van,
which she had to arrange on her own as a consequence
of the delay – the complaint would be barred by the
two-year statute of limitations. However, where the
plaintiff alleged that the airlines subjected her to unjust
discrimination or undue or unreasonable preference or
disadvantage, an act punishable under the United States
laws, then the plaintiff may claim purely nominal
compensatory damages for humiliation and hurt
feelings, which are not provided for by the Warsaw
Convention. In another case, Wolgel v. Mexicana
Airlines,20 the court pronounced that actions for
damages for the "bumping off" itself, rather than the
incidental damages due to the delay, fall outside the
Warsaw Convention and do not prescribe in two years.
In the Petition at bar, private respondent’s Complaint
alleged that both PAL and Singapore Airlines were
guilty of gross negligence, which resulted in his being
subjected to "humiliation, embarrassment, mental
20 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
anguish, serious anxiety, fear and distress."21 The
emotional harm suffered by the private respondent as a
result of having been unreasonably and unjustly
prevented from boarding the plane should be
distinguished from the actual damages which resulted
from the same incident. Under the Civil Code provisions
on tort,22 such emotional harm gives rise to
compensation where gross negligence or malice is
proven.
The instant case is comparable to the case of Lathigra v.
British Airways.23
In Lathigra, it was held that the airlines’ negligent act of
reconfirming the passenger’s reservation days before
departure and failing to inform the latter that the flight
had already been discontinued is not among the acts
covered by the Warsaw Convention, since the alleged
negligence did not occur during the performance of the
contract of carriage but, rather, days before the
scheduled flight.
In the case at hand, Singapore Airlines barred private
respondent from boarding the Singapore Airlines flight
because PAL allegedly failed to endorse the tickets of
private respondent and his companions, despite PAL’s
assurances to respondent that Singapore Airlines had
already confirmed their passage. While this fact still
needs to be heard and established by adequate proof
before the RTC, an action based on these allegations will
not fall under the Warsaw Convention, since the
purported negligence on the part of PAL did not occur
during the performance of the contract of carriage but
days before the scheduled flight. Thus, the present
action cannot be dismissed based on the statute of
limitations provided under Article 29 of the Warsaw
Convention.
Had the present case merely consisted of claims
incidental to the airlines’ delay in transporting their
passengers, the private respondent’s Complaint would
have been time-barred under Article 29 of the Warsaw
Convention. However, the present case involves a
special species of injury resulting from the failure of
PAL and/or Singapore Airlines to transport private
respondent from Singapore to Jakarta – the profound
distress, fear, anxiety and humiliation that private
respondent experienced when, despite PAL’s earlier
assurance that Singapore Airlines confirmed his
passage, he was prevented from boarding the plane and
he faced the daunting possibility that he would be
stranded in Singapore Airport because the PAL office
was already closed.

These claims are covered by the Civil Code provisions

on tort, and not within the purview of the Warsaw
Convention. Hence, the applicable prescription period is
that provided under Article 1146 of the Civil Code:

Art. 1146. The following actions must be

instituted within four years:

(1) Upon an injury to the rights of the plaintiff;

(2) Upon a quasi-delict.

Private respondent’s Complaint was filed with the RTC

on 15 August 1997, which was less than four years since
PAL received his extrajudicial demand on 25 January
1994. Thus, private respondent’s claims have not yet
prescribed and PAL’s Motion to Dismiss must be denied.

Moreover, should there be any doubt as to the

prescription of private respondent’s Complaint, the
more prudent action is for the RTC to continue hearing
the same and deny the Motion to Dismiss. Where it
cannot be determined with certainty whether the action
has already prescribed or not, the defense of
prescription cannot be sustained on a mere motion to
dismiss based on what appears to be on the face of the
complaint.24 And where the ground on which
prescription is based does not appear to be indubitable,
the court may do well to defer action on the motion to
dismiss until after trial on the merits. 25

IN VIEW OF THE FOREGOING, the instant Petition

is DENIED. The assailed Decision of the Court of
Appeals in CA-G.R. SP No. 48664, promulgated on 17
August 2001 is AFFIRMED. Costs against the petitioner.

SO ORDERED.

Ynares-Santiago, Chairperson, Austria-Martinez,

Nachura, Reyes, JJ., concur.

21 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
 Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. L-31150 July 22, 1975
KONINKLIJKE LUCHTVAART MAATSHAPPIJ N.V.,
otherwise known as KLM ROYAL DUTCH
AIRLINES, petitioner,
vs.
THE HONORABLE COURT OF APPEALS, CONSUELO T.
MENDOZA and RUFINO T. MENDOZA, respondents.
Picazo, Agcaoili, Santayana, Reyes and Tayao for
petitioner.
Bengzon, Villegas, Zarraga, Narciso and Cudala for
respondents.
CASTRO, J.:
In this appeal by way of certiorari the Koninklijke
Luchtvaart Maatschappij N.V., otherwise known as the
KLM Royal Dutch Airlines (hereinafter referred to as the
KLM) assails the award of damages made by the Court
of Appeals in CA-G.R. 40620 in favor of the spouses
Rufino T. Mendoza and Consuelo T. Mendoza
(hereinafter referred to as the
respondents).1äwphï1.ñët
Sometime in March 1965 the respondents approached
Tirso Reyes, manager of a branch of the Philippine
Travel Bureau, a travel agency, for consultations about a
world tour which they were intending to make with
their daughter and a niece. Reyes submitted to them,
after preliminary discussions, a tentative itinerary
which prescribed a trip of thirty-five legs; the
respondents would fly on different airlines. Three
segments of the trip, the longest, would be via KLM. The
respondents expressed a desire to visit Lourdes, France,
and discussed with Reyes two alternate routes, namely,
Paris to Lourdes and Barcelona to Lourdes. The
respondents decided on the Barcelona-Lourdes route
with knowledge that only one airline, Aer Lingus,
serviced it.
The Philippine Travel Bureau to which Reyes was
accredited was an agent for international air carriers
which are members of the International Air Transport
Association, popularly known as the "IATA," of which
both the KLM and the Aer Lingus are members.
After about two weeks, the respondents approved the
itinerary prepared for them, and asked Reyes to make
the necessary plane reservations. Reyes went to the
KLM, for which the respondents had expressed
preference. The KLM thereafter secured seat
reservations for the respondents and their two
companions from the carriers which would ferry them
throughout their trip, with the exception of Aer Lingus.
When the respondents left the Philippines (without
their young wards who had enplaned much earlier),
they were issued KLM tickets for their entire trip.
However, their coupon for the Aer Lingus portion
(Flight 861 for June 22, 1965) was marked "RQ" which
meant "on request".
After sightseeing in American and European cities (they
were in the meantime joined by their two young
companions), the respondents arrived in Frankfurt,
Germany. They went to a KLM office there and obtained
a confirmation from Aer Lingus of seat reservations on
flight 861. After meandering in London, Paris and
Lisbon, the foursome finally took wing to Barcelona for
their trip to Lourdes, France.
In the afternoon of June 22, 1965 the respondents with
their wards went to the Barcelona airport to take their
plane which arrived at 4:00 o'clock. At the airport, the
manager of Aer Lingus directed the respondents to
check in. They did so as instructed and were accepted
for passage. However, although their daughter and
niece were allowed to take the plane, the respondents
were off-loaded on orders of the Aer Lingus manager
who brusquely shoved them aside with the aid of a
policeman and who shouted at them, "Conos!
Ignorantes Filipinos!"
Mrs. Mendoza later called up the manager of Aer Lingus
and requested that they provide her and her husband
22 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
means to get to Lourdes, but the request was denied. A
stranger, however, advised them to take a train, which
the two did; despite the third class accommodations
and lack of food service, they reached Lourdes the
following morning. During the train trip the
respondents had to suffer draft winds as they wore only
minimum clothing, their luggage having gone ahead
with the Aer Lingus plane. They spent $50 for that train
trip; their plane passage was worth $43.35.
On March 17, 1966 the respondents, referring to KLM as
the principal of Aer Lingus, filed a complaint for
damages with the Court of First Instance of Manila
arising from breach of contract of carriage and for the
humiliating treatment received by them at the hands of
the Aer Lingus manager in Barcelona. After due hearing,
the trial court awarded damages to the respondents as
follows: $43.35 or its peso equivalent as actual
damages, P10,000 as moral damages, P5,000 as
exemplary damages, and P5,000 as attorney's fees, and
expenses of litigation.
Both parties appealed to the Court of Appeals. The KLM
sought complete exoneration; the respondents prayed
for an increase in the award of damages. In its decision
of August 14, 1969 the Court of Appeals decreed as
follows: "Appellant KLM is condemned to pay unto the
plaintiffs the sum of $43.35 as actual damages; P50,000
as moral damages; and P6,000 as attorney's fees and
costs."
Hence, the present recourse by the KLM.
The KLM prays for exculpation from damages on the
strength of the following particulars which were
advanced to but rejected by the Court of Appeals:
(a) The air tickets issued to the respondents stipulate
that carriage thereunder is subject to the "Convention
for the Unification of Certain Rules Relating to
International Transportation by Air," otherwise known
as the "Warsaw Convention," to which the Philippine
Government is a party by adherence, and which
pertinently provides.1
ART. 30. (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
(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. (emphasis supplied)
(b) On the inside front cover of each ticket the following
appears under the heading "Conditions of Contract":
1 ... (a) Liability of carrier for
damages shall be limited to
occurrences on its own line, except in
the case of checked baggage as to
which the passenger also has a right
of action against the first or last
carrier. A carrier issuing a ticket or
checking baggage for carriage over
the lines of others does so only as
agent..
(c) All that the KLM did after the respondents
completed their arrangements with the travel agency
was to request for seat reservations among the airlines
called for by the itinerary submitted to the KLM and to
issue tickets for the entire flight as a ticket-issuing
agent.
The respondents rebut the foregoing arguments, thus:
(a) Article 30 of the Warsaw Convention has no
application in the case at bar which involves, not an
accident or delay, but a willful misconduct on the part of
the KLM's agent, the Aer Lingus. Under article 25 of the
same Convention the following is prescribed:
ART. 25. (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 willful misconduct.3
(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.
(emphasis by respondents)
(b) The condition in their tickets which purportedly
excuse the KLM from liability appears in very small
print, to read which, as found by the Court of Appeals,
one has practically to use a magnifying glass.
(c) The first paragraph of the "Conditions of Contract"
appearing identically on the KLM tickets issued to them
idubitably shows that their contract was one of
continuous air transportation around the world:
1 ... "carriage" includes the air carrier
issuing this ticket and all carriers
that carry or undertake to carry the
passenger or his baggage hereunder
or perform any other service
incidental to such air carriage...
Carriage to be performed hereunder
by several successive carrier is
regarded as a single operation.
(d) The contract of air transportation was exclusively
between the respondents and the KLM, the latter
merely endorsing its performance to other carriers, like
Aer Lingus, as its subcontractors or agents, as evidenced
by the passage tickets themselves which on their face
disclose that they are KLM tickets. Moreover, the
23 | T R A N S P O ( A i r T r a n s p o r t a ti o n )
respondents dealt only with KLM through the travel
agency.
1. The applicability insisted upon by the KLM of article
30 of the Warsaw Convention cannot be sustained. That
article presupposes the occurrence of either an accident
or a delay, neither of which took place at the Barcelona
airport; what is here manifest, instead, is that the Aer
Lingus, through its manager there, refused to transport
the respondents to their planned and contracted
destination.
2. 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. As the airline which issued
those tickets with the knowledge that the respondents
would be flown on the various legs of their journey by
different air carriers, the KLM was chargeable with the
duty and responsibility of specifically informing the
respondents of conditions prescribed in their tickets or,
in the very least, to ascertain that the respondents read
them before they accepted their passage tickets. A
thorough search of the record, however, inexplicably
fails to show that any effort was exerted by the KLM
officials or employees to discharge in a proper manner
this responsibility to the respondents. Consequently, we
hold that the respondents cannot be bound by the
provision in question by which KLM unilaterally
assumed the role of a mere ticket-issuing agent for
other airlines and limited its liability only to untoward
occurrences on its own lines.
3. Moreover, 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.
4. The breach of that guarantee was aggravated by the
discourteous and highly arbitrary conduct of an official
of the Aer Lingus which the KLM had engaged to
transport the respondents on the Barcelona-Lourdes
segment of their itinerary. It is but just and in full
accord with the policy expressly embodied in our civil
law which enjoins courts to be more vigilant for the
protection of a contracting party who occupies an
inferior position with respect to the other contracting
party, that the KLM should be held responsible for the
abuse, injury and embarrassment suffered by the
respondents at the hands of a supercilious boor of the
Aer Lingus.
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 the territory subject to the
sovereignty, suzerainty, mandate, or
authority of the same High
Contracting Party."
3 Article 22 of the Convention limits
the liability of an air carrier in the
transportation of passengers to
125,000 francs except where both
carrier and passenger "agree to a
higher limit of liability."

ACCORDINGLY, the judgment of the Court of Appeals

dated August 14, 1969 is affirmed, at KLM's cost.

Makalintal, C.J., Makasiar, Esguerra and Muñoz Palma,

JJ., concur.

Footnotes

1 See 51 O.G. 4933 et seq. for text of

Presidential Proclamation of
adherence dated September 23,
1955. See 51 O.G. 5084 et seq. for full
text of the Convention.

2 Article I (3) provides:

"Transportation to be performed by
several successive air carriers shall
be deemed, for the purposes of this

24 | T R A N S P O ( A i r T r a n s p o r t a ti o n )