Cathay Pacific Airways, Ltd. V. Court of Appeals, G.R. No.

60501, 5 March 1993

FACTS: The passenger, Mr. Tomas Alcantara was a first class passenger of the petitioner airline on 19 Oct
1975 on Flight No. CX-900 from Manila to Hongkong and onward from Hongkong to Jakarta on Flight No.
CX-711. The purpose of Mr. Alcantra’s trip was due for a conference with the Director General of Trade of
Indonesia on 20 October 1975. His checked in luggage contained not only his clothing and articles for
personal use but also papers and document he needed for the conference.

Upon arrival in Jakarta, Alcantara discovered that his luggage was missing and when he inquired regarding
this, the representative of Cathay told him that his luggage was left in Hongkong. Alcantara was offered
$20.00 as inconvenience money to buy his immediate personal needs until the delivery of the luggage. It
was only after more than 24 hours after his arrival when his luggage reached Jakarta but was only to be
picked up by an official of the Philippine Embassy.

The respondent filied his complaint against the petitioner airline with the CFI of Lanao del Norte praying
for temperate, moral and exemplary damages, plus attorney’s fees. The trial court rendered a decision other
Cathay to pay Alcantara Php 20,000.00 for moral damages, Php 5,000.00 for temperate damages, Php
10,000.00 for exemplary damages and Php 25,000.00 for attorney’s fees and the costs. On appeal, the
petitioner assailed the conclusion of the TC that it was accountable for breach of contract and questioned
the non-application by the court of the Warsaw Convention.

ISSUE: Whether the Court of Appeals erred in failing to apply the Warsaw Convention on the liability of a
carrier to its passengers?

HELD: The CA did not err in not applying the Warsaw Convention in this case. The Warsaw Convention
declares the carrier liable for damages in the enumerated cases and under certain limitations. However, it
must not be construed to preclude the operation of the Civil Code and other pertinent laws. It does not
regulate, much less exempt, the carrier from liability for damages for violating the rights of its passengers
under the contract of carriage, especially if willful misconduct on the part of the carrier’s employees is
found or established which is present in this case.

For the Warsaw Convention it provided in Art 25 that:

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”
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

Philippine Airlines v. Court of Appeals, G.R. No. L-44936, 25 September 1992

FACTS: On April 4, 1972, private respondent boarded herein petitioner’s Flight PR 301 from Hongkong to
Manila and checked in four (4) pieces of baggage. When the plane landed in Manila, private respondent
was not able to locate the two pieces of baggage containing cinematographic films despite diligent search
therefor. Private respondent made the claim for such loss to petitioner, which admitted the loss and offered
to compensate private respondent. Instead of accepting the offer, private respondent opted to file the case
below to principally recover the value of the lost items which he estimated to be worth P20,000.00. The
petitioner limits the liability under the applicable rules and regulations of the Warsaw Convention limited
to a maximum of US$ 6.50 per kilogram for the private respondent’s loss to US $165.00, or its equivalent
in Philippine currency.

ISSUE: Whether the Petitioner can avail of the limitations under the Warsaw Convention
HELD: Now, as to whether petitioner may utilize the provision under Article 22(2) of the Warsaw
Convention which limits the liability of a common carrier for loss of baggage, We have to consider other
salient features thereof such as Article 4, paragraph 1 that:

"For the transportation of baggage, other than small personal objects of which the passenger takes charge
himself, the carrier must deliver a baggage check."

and the explicit wordings of Article 4, paragraph 4 of the same Convention that:

"The absence, irregularity, or loss of the baggage checks shall not affect the existence or the validity of the
contract of transportation which shall nonetheless be subject to the rules of this Convention. Nevertheless,
if the carrier accepts baggage without a baggage check having been delivered, or if the baggage check does
not contain the particulars set out at (d), (f), and (h) above, the carrier shall not be entitled to avail himself
of those provisions of the Convention which exclude or limit his liability."

Philippine Airlines, Inc. v. Court of Appeals and Mejia, G.R. No. 119706, 14 March 1996

FACTS: Plaintiff, Gilda C. Mejia, shipped thru defendant, Philippine Airlines, one (1) unit microwave
oven, fromSan Francisco, U.S.A. to Manila, Philippines. Upon arrival, however, of said article in Manila,
Philippines,plaintiff discovered that its front glass door was broken and the damage rendered it
unserviceable.Demands both oral and written were made by plaintiff against the defendant for the
reimbursement of the value of the damaged microwave oven, and transportation charges paid by plaintiff to
defendant company.Plaintiff filed the instant action for damages against defendant in the lower court.
Defendant Airlines alleged inter alia, by way of special and affirmative defenses, that the court has no
jurisdiction over thecase; that plaintiff has no valid cause of action against defendant since it acted only in
good faith and incompliance with the requirements of the law, regulations, conventions and contractual
commitments;and that defendant had always exercised the required diligence in the selection, hiring and
supervision of its employees.Petitioner airlines argues that the legal principle enunciated in Fieldmen’s
Insurance does not apply to thepresent case because the provisions of the contract involved here are neither
ambiguous nor obscure.

The trial court justified its award of actual, moral and exemplary damages, and attorney’s fees in favor of
private respondent that since the plaintiff’s baggage destination was the Philippines, Philippine law governs
the liability of the defendant for damages for the microwave oven. And that, plaintiff has established that
defendant acted in bad faith when it denied the former’s claim on the ground that the formal claim was filed
beyond the period as provided in the Air Waybill when actually, Concepcion DiñoThe court finds that the
petitioner acted in bad faith in denying private respondent’s claim, which was affirmed by the Court of
Appeals. Hence this appeal for Certiorari, sister of plaintiff has immediately filed the formal claim upon
discovery of the damage.

ISSUE: Whether the CA erred in affirming the finding of the trial court that herein petitioners liability is
not limited by the provisions of the air waybill

HELD: (in relation to the limitation) Finally, the Court finds no merit to defendants contention that under
the Warsaw Convention, its liability if any, cannot exceed U.S. $20.00 based on weight as plaintiff did not
declare the contents of her baggage nor pay additional charges before the flight.[14]

The appellate court declared correct the non-application by the trial court of the limited liability of therein
defendant-appellant under the Conditions of the Contract contained in the air waybill , based on the ruling
in Cathay Pacific Airways, Ltd. vs. Court of Appeals, et al.,[15] which substantially enunciates the rule that
while the Warsaw Convention has the force and effect of law in the Philippines, being a treaty commitment
by the government and as a signatory thereto, the same does not operate as an exclusive enumeration of the
instances when a carrier shall be liable for breach of contract or as an absolute limit of the extent of
liability, nor does it preclude the operation of the Civil Code or other pertinent laws.
Petitioner insists that both respondent court and the trial court erred in finding that petitioners liability, if
any, is not limited by the provisions of the air waybill, for, as evidence of the contract of carriage between
petitioner and private respondent, it substantially states that the shipper certifies to the correctness of the
entries contained therein and accepts that the carriers liability is limited to US$20 per kilogram of goods
lost, damaged or destroyed unless a value is declared and a supplementary charge paid. Inasmuch as no
such declaration was made by private respondent, as she admitted during cross-examination, the liability of
petitioner, if any, should be limited to 28 kilograms multiplied by US$20, or $560. Moreover, the validity
of these conditions has been upheld in the leading case of Ong Yiu vs. Court of Appeals, et al., supra, and
subsequent cases, for being a mere reiteration of the limitation of liability under the. Warsaw Convention,
which treaty has the force and effect of law.