Lydia L. Geraldez vs.

Court of Appeals, and Kenstar Travel Corporation

G.R. No. 108253; February 23, 1994
Ponente: Regalado, J. – SUPREME COURT 2nd DIVISION

FACTS:

Petitioner Lydia Geraldez filed an action for damages against private

respondent Kenstar Travel Corporation (Kenstar). The action sprung advertisement
regarding European tours which Geraldez chose. Geraldez paid a total sum of
P190,000 to Kenstar Travel Corporation for a 22-day tour of Europe denominated
as “VOLARE 3”. During the tour, Geraldez was very disappointed when there was
no European tour manager for their group of tourists, the hotels were not first-
class, the UGC Leather Factory which was included in the package was not visited
and that the Filipino lady tour guide was a first-timer performing her duties for the
first time.
RTC ruled in favor of Geraldez, and asked Kenstar to pay Geraldez of moral
damages, nominal damages, exemplary damages, attorney’s fees and costs of the
suit. On appeal, the Court of Appeals removed the moral and exemplary damages,
and reduced the nominal damages and attorney’s fees. Kenstar contends that they
are not liable for damages for Geraldez.

ISSUE:
Whether Kenstar acted in bad faith or with gross negligence in discharging
its obligations under the contract that warrants payment of damages to Geraldez

RULING:
YES. Kenstar failed to comply faithfully with its commitments under Volare
3 Tour Program.

Supreme Court held that the contract between Geraldez with Kenstar was a
contract of adhesion, that is, one party imposes or formulated the provisions of the
contract and that the other party was only to affix his or her signature thereto.
Adhesion contracts are not necessarily void, but are construed strictly against the
one who drafted the same.
It was clear under the provisions of VOLARE 3 Europe tour, Kenstar would
provide first-class hotels. Failure of which proved that Kenstar was in neglect in
the observance of such stipulation. In addition, Kenstar has employed an
inexperience tour guide which proves that Geraldez shall be entitled to damages.
Such negligence and fraudulent acts produced serious anxiety and distress to
Geraldez, prompting the award of damages proper against Kenstar.