China Air vs Daniel Chiok (2003)

Facts: Chiok bought a ticket with CAL (Mnl-Taipei-Hk-ML). This ticket was endorsable with
PAL. The trips covered were pre-scheduled and confirmed by CAL.
In Taipei, he went to CAL office and confirmed his HK to Mnl trip on board a PAL airplane. CAL
confirmed the flight. Upon arriving in HK, PAL confirmed his next flight. However on the day of
the flight, he saw that it was cancelled.
Chiok told the PAL people that he needed to arrive in Manila the next day. The following day,
Chiok presented his ticket but was refused because his name was not on the list and was not
permitted to board Flight 307.
He confronted the PAL reservation officer but was told that his name was on the list. He decided
to use another CAL ticket which booked him with his original flight (Flight 311). Before boarding
he lost his clutch bag containing valuable things.
Upon reaching Manila, he filed a complaint alleging that despite several confirmations he was
declined to fly and that a flight personnel ridiculed him. That by reason of his ticket, both PAL
And CAL are liable against him.
Issue: WON CAL as a ticket issuer is liable against Chiok for the breach of contract of carriage
by PAL’s employees (Yes, General Pool Partnership)
Ruling: Warsaw Convention and IATA existing practices: Contract of air carriage where
petitioner endorsed to PAL the HK-MNL leg is to be treated as a single operation.

Article 1, Section 3 Warsaw Convention”

“Transportation to be performed by several successive air 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 form of 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 a territory subject to the
sovereignty, suzerainty, mandate, or authority of the same High Contracting Party.”

Article 15 of IATA-Recommended Practice

“Carriage to be performed by several successive carriers under one ticket, or under a ticket and
any conjunction ticket issued therewith, is regarded as a single operation.”

Under a general pool partnership agreement, the ticket-issuing airline is the principal in a
contract of carriage, while the endorsee-airline is the agent.

Members of the IATA are under a general pool partnership agreement wherein they act as
agent of each other in the issuance of tickets 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.

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.

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, petitioner tacitly recognized its
commitment under the IATA pool arrangement to act as agent of the principal contracting
airline, 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 and having the same points of
departure and destination.

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.

the obligation of the ticket-issuing airline remained and did not cease, regardless of the fact that
another airline had undertaken to carry the passengers to one of their destinations.

Cathay vs CA – Respo first class passenger sued petitioner because of its breach of contract
involving respo’s luggage when he was going to attend a conference in Jakarta. RTC and CA
affirmed the petition for damages.
Issue: WON CA was wrong when it did not apply Warsaw Convention on mitigated liability of
petitioner
Ruling: No, Warsaw cannot stop the application of the Civil Code and even warsaw itself makes
petitioner liable.