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PHILIPPINE SUPREME COURT DECISIONS

FIRST DIVISION

[G.R. No. 104685. March 14, 1996.]

SABENA BELGIAN WORLD AIRLINES, Petitioner, v. HON. COURT OF APPEALS and MA. PAULA SAN AGUSTIN, Respondents.

Saturnino M . Basconcillo for Petitioner.

F .S. De Guzman and Associates for Private Respondent.


SYLLABUS


1. CIVIL LAW, OBLIGATIONS AND CONTRACTS; FAULT OR NEGLIGENCE CONSISTS IN THE OMISSION OF DILIGENCE DEMANDED BY THE NATURE OF AN OBLIGATION. — Fault or negligence consists in the omission of that diligence which is demanded by the nature of an obligation and corresponds with the circumstances of the person, of the time, and of the place.

2. ID.; ID.; ID.; PRESUMPTION OF FAULT ARISES UPON BREACH OR NON-FULFILLMENT OF THE PRESTATION. — When the source of an obligation is derived from a contract, the mere breach or non-fulfillment of the prestation gives rise to the presumption of fault on the part of the obligor.

3. ID.; ID.; COMMON CARRIERS; BOUND TO OBSERVE EXTRAORDINARY CARE IN THE VIGILANCE OVER THE GOODS. — This rule is no different in the case of common carriers in the carriage of goods which, indeed are bound to observe not just the due diligence of a good father of a family but that of "extraordinary" care in the vigilance over the goods.

4. ID.; ID.; TORT; PROXIMATE CAUSE, CONSTRUED. — Proximate cause is that which, in natural and continuous sequence, unbroken by any efficient intervening cause, produces injury and without which the result would not have occurred. The exemplification by the Court in one case is simple and explicit; viz:" (T)he proximate legal cause is that acting first and producing the injury, either immediately or by setting other events in motion, all constituting a natural and continuous chain of events, each having a close causal connection with its immediate predecessor, the final event in the chain immediately affecting the injury as a natural and probable result of the cause which first acted under such circumstances that the person responsible for the first event should, as an ordinarily prudent and intelligent person, have reasonable ground to expect at the moment of his act or default that an injury to some person might probably result therefrom."cralaw virtua1aw library

5. ID.; ID.; COMMON CARRIERS; LOSS OF PASSENGER’S BAGGAGE NOT ONLY ONCE BUT TWICE CONSTITUTES GROSS NEGLIGENCE; CASE AT BAR. — It remained undisputed that private respondent’s luggage was lost while it was in the custody of petitioner. It was supposed to arrive on the same flight that private respondent took in returning to Manila on 02 September 1987. When she discovered that the luggage was missing, she promptly accomplished and filed a Property Irregularity Report. She followed up her claim on 14 September 1987, and filed, on the following day, a formal letter-complaint with petitioner. She felt relieved when, on 23 October 1987, she was advised that her luggage had finally been found, with its contents intact when examined, and that she could expect it to arrive on 27 October 1987. She then waited anxiously only to be told later that her luggage had been lost for the second time. Thus, the appellate court, given all the facts before it, sustained the trial court in finding petitioner ultimately guilty of "gross negligence" in the handling of private respondent’s luggage. The "loss of said baggage not only once but twice," said the appellate court, "underscores the wanton negligence and lack of care" on the part of the carrier. The above findings, which certainly cannot be said to be without basis, foreclose whatever rights petitioner might have had to the possible limitation of liabilities enjoyed by international air carriers under the Warsaw Convention (Convention for the Unification of Certain Rules Relating to International Carriage by Air, as amended by the Hague Protocol of 1955, the Montreal Agreement of 1966, the Guatemala Protocol of 1971 and the Montreal Protocols of 1975). The Court thus sees no error in the preponderant application to the instant case by the appellate court, as well as by the trial court, of the usual rules on the extent of recoverable damages beyond the Warsaw limitations. Under domestic law and jurisprudence (the Philippines being the country of destination), the attendance of gross negligence (given the equivalent of fraud or bad faith) holds the common carrier liable for all damages which can be reasonably attributed, although unforeseen, to the non-performance of the obligation, including moral and exemplary damages.


D E C I S I O N


VITUG, J.:


The appeal before the Court involves the issue of an airline’s liability for lost luggage. The petition for review assails the decision of the Court Appeals, 1 dated 27 February 1992, affirming an award of damages made by the trial court in a complaint filed by private respondent against petitioner.

The factual background of the case, narrated by the trial court and reproduce at length by the appellate court, is hereunder quoted:jgc:chanrobles.com.ph

"On August 21, 1987, plaintiff was a passenger on board flight SN 284 of defendant airline originating from Casablanca to Brussels, Belgium on her valuables, namely: jewelries valued at $2,350.00; clothes $1,500.00 shoes/bag $150; accessories $75; luggage itself $10.00; or a total of $4,265.00, for which she was issued Tag No. 77143. She stayed overnight in Brussels and her luggage was left on board Flight SN 284.

"Plaintiff arrived at Manila International Airport on September 2, 1987 and immediately submitted her Tag No 71423 to facilitate the release of her luggage but the luggage was missing. She was advised to accomplish and submitted and filed on the same day.

"She followed up her claim on Septembers 14, 1987 but the luggage remained to be missing.

"On September 15, 1987, she filed her formal complaint with the office of Ferge Massed, defendant’s Local Manager, demanding immediate attention (Exh.’A’).

"On September 30, 1987, on the Occasion of plaintiff’s following up her luggage claim, she was furnished copies of defendant’s telexes with and information that the Brussel’s Office of defendant found the luggage and that they have assured by the defendant that it has notified its Manila Office 1987. But unfortunately plaintiff was informed that the luggage was lost for the second time (Exhibits ‘C’ and ‘C-1’).

"At the time of the filling of the complaint, the luggage was its content has not been found.

"Plaintiff demanded from the defendant the money value of the luggage and its contents amounting to $4,265.00 or its exchange value, but defendant refused to settle the claim.

"Defendant asserts in its Answer about evidence tend to show that while it admits that the plaintiff was a passenger on board Flight No. SN 284 with a piece of checked in luggage bearing Tag No. 71423, the loss of the luggage was due to plaintiffs sole if not contributory negligence; that the did not declare the valuable items in her checked in luggage at the flight counter when she checked in for her flight from Casablanca to Brussels so that either the representative of the defendant at the alleged valuable items and required her to secure an insurance on the alleged valuable items and required her to pay additional charges, or would have refused acceptance of her baggage as required by the generally accepted practices of international carriers; that Section 9(a), Article 1X of General Conditions of carriage at the Brussels Airport that plaintiff should have retrieved her undeclared valuables from her baggage at the Brussels Airport; that plaintiff should have retrieved her undeclared valuables from her baggage at the Brussels Airport since her flight from Brussels to Manila will still have to visit for confirmation inasmuch as only her flight from Casablaca to Brussels was confirmed; that defendant incorporated in all Sabena Plane Tickets, including Sabena Ticket No. 0824222-72502241 issued to plaintiff in Manila on August 21, 1987, a warning that ‘Items of value should be carried on your person and that some carrier assume no liability for fragile, valuable or perishable articles for guidance; that granting without conceding that defendant it liable, its liability is limited only to US $20.00 per kilo due to plaintiff’s failure to declare a higher value on the contents of her checked in luggage and pay additional charges thereon." 2

The trial court rendered judgment ordering petitioner Sabena Belgian World Airlines to pay private respondent Ma. Paula San Agustin

"(a) . . . US$4,265.00 or its legal exchange in Philippine pesos;

"(b) . . . P30,000.00 as moral damages;

"(c) . . . P10,000.00 as exemplary damages;

"(d) . . . P10,000.00. attorney’s fees; and

"(e) (t)he cost of the suit." 3

Sabena appealed the decision of the Regional Trial Court to the Court of Appeals. The appellate court, in its decision of 27 February 1992, affirmed in toto the trial court’s judgment.

Petitioner airline company, in contending that the alleged negligence of private respondent should be considered the primary cause for the loss of her luggage, avers that, despite her awareness that the flight ticket had been confirmed only for Casablanca and Brussel, and that her flight from Brussels to Manila had yet to be confirmed, she did not retrieve the luggage upon arrival in Brussels. Petitioner insist that private respondent, being a seasoned international traveler, must have likewise been familiar with the standard provisions contained in her flight ticket that items of value are required to be hand-carried by the passenger and that the liability of the airlines for loss, delay or damage to baggage would be limited, in any event, to only US$20.00 per kilo unless a higher value is declared in advance and corresponding additional charge are paid thereon, At the Casablanca International Airport, private respondent, in checking in her luggage evidently did not declare its contents or value . Petitioner cites Section 5(c), Article IX, of the General Conditions of Carriage, signed at Warsaw, Poland, on 02 October 1929, as amended by the Hague Protocol of 1955, generally observed by International carriers, stating among other things, that:jgc:chanrobles.com.ph

"Passengers shall not include in his checked baggage, and the carrier may refuse to carry as checked baggage, Fragiles or perishable articles, money, jewelry, precious metals, negotiable papers, securities or other valuable." 4

Fault or negligence consists in the omission of that diligence which is demanded by the nature of an obligation and corresponds with the circumstances of the person, of the time, and of the place. When the source of an obligation is derived from a contract, the mere. breach or non-fulfillment of the prestation gives rise to the presumption of fault on the part of the obligor. This rule is not different in the case of common carriers in the carriage of good father of a family but that of "extraordinary" care in the vigilance over the goods. The appellate court has aptly observe:jgc:chanrobles.com.ph

". . . Art. 1733 of the [Civil] Code provides that from the very nature of their business and by reason of public policy, common carriers are bound to observe extraordinary diligence in the vigilance over the goods transported by them. This extraordinary responsibility, according to Art. 1736, lasts from the time the goods are unconditionally placed in the possession of and received by the consignee or person who has the right to receive them. Art 1737 states that the common carrier’s duty to observe extraordinary diligence in the vigilance over the goods transported by them remains in full force and effect even when they are temporarily unloaded or stored in transits.’ And Art. 1735 establishes the presumption that if the goods are lost, destroyed or deteriorate, common carrier are presumed to have En at fault or to have acted negligently, unless they prove that they had observed extraordinary diligence as required in Article 1733.

"The only exceptions to the foregoing extraordinary responsibility of the common carrier is when the loss, destruction, or deterioration of the goods is due to any of the following causes:jgc:chanrobles.com.ph

"(1) Flood, storm, earthquake, lightning, or other natural disaster or calamity;

"(2) Act of the public enemy in war, whether international or civil;

"(3) Act or omission of the shipper or owner of the goods;

"(4) The character of the goods or defects in the packing or in the containers;

"(5) Order or act of excepted causes obtains in the case." 5

The above rules remain basically unchanged even when the contract is breached by tort 6 although noncontradictory principles on quasi-delict may then be assimilated as also forming part of the governing law. Petitioner is not thus entirely off track when it has likewise raised in its defense the tort doctrine cannot, in this particular instance, support its case. Proximate cause is that which, in natural and continues sequence, unbroken by any efficient intervening cause, produces injury and without which the result would not have occurred. The exemplication by the Court in one case 7 is simple and explicit; viz:jgc:chanrobles.com.ph

"(T)he proximate legal cause is that acting first and producing the injury, either immediately or by setting other events in motion, all constituting a natural and continuous chain of events, each having a close causal connection with its immediate predecessors, the final event in the chain immediately affecting the injury as a natural and probable result of the cause which first acted, under such circumstances that the person responsible for the event should, as an ordinarily prudent and intelligent person, have reasonable ground to expect at the moment of his act or default that an injury to some person might probably result therefrom."cralaw virtua1aw library

It remained undisputed that private respondent’s luggage was lost while it was in the custody of petitioner. It was supposed to arrive on the same flight that private respondent took in returning to Manila on 02 September 1987. When she discovered that the luggage was missing, she promptly accomplished and filed a Property Irregularity Report. She followed up her claim on 14 September 1987, and filed, on the following day, a formal letter-complaint with petitioner. She felt relieved when, on 23 October 1987, she was advised that her luggage had finally been found, with its contents intact when waited anxiously only to be told later that her luggage had been lost for the second time. Thus, the appellate court, given all the facts before it, sustained the trial court in finding petitioner ultimately guilty of "gross negligence" in the handling of private respondent’s luggage. The "loss of said baggage not only once by twice," said the appellate court, "underscore the wanton negligence and lack of care" on the part of the carrier.

The above findings, which certainly cannot be said to be without basis, foreclose whatever right s petitioner might have had to the possible limitation of liabilities enjoyed by international air carriers under the Warsaw Convention (Convention for the Unification of Certain Rules Relating to International Carriage by Air, as amended by the Hague Protocol of 1955, the Montreal Agreement of 1966, the Guatemala Protocol of 1971 and the Montreal Protocols of 1975). In Alitalia v. Intermediate Appellate Court, 8 now Chief Justice Andres R. Narvasa, speaking for the Court, has explained it well; he said:jgc:chanrobles.com.ph

"The Warsaw Convention however denies to the carrier availment ‘of the provisions which exclude or limit his liability if the damage is caused by his wilful misconduct or by such default on his part as, in accordance with the law of the court seized of the case, is considered to be equivalent to willful misconduct,’ or ‘if the damage is (similarly) caused . . . by any agent of the carrier acting within the scope of his employment.’ The Hague Protocol amended the Warsaw Convention by removing the provision that if the airline took all necessary steps to avoid the damage, it could exculpate itself completely, and declaring the stated limits of liability not applicable ‘if it is proved that the damage resulted from an act or omission of the carrier, its servants or agents, done with intent to cause damage or recklessly and with knowledge that damage would probably result.’ The same deletion was effected by the Montreal Agreement of 1966, with the result that a passenger could recover unlimited damages upon proof of wilful misconduct.

"The Convention does not thus operate as an exclusive enumeration of the instances of an airline’s liability, or as an absolute limit of the extent of that liability. Such a proposition is not borne out by the language of the Convention, as this Court has now, and at an earlier time, pointed out. Moreover, slight reflection readily leads to the conclusion that it should be deemed a limit of liability only in those cases where the cause of the death or injury to person, or destruction, loss or damage to property or delay in its transport is not attributable to or attended by any wilful misconduct, bad faith, recklessness or otherwise improper conduct on the part of any official or employee for which the carrier is responsible, and the carrier’ or misconduct of its employees, or for some Particular or exceptional type of damage. Otherwise, an air carrier would be exempt from any liability for damages in the event of its absolute refusal, in bad faith, to comply with a contract of carriage, which is absurd. No may it for a moment be supposed that if a member of the aircraft complement should inflict some physical injury on a passenger, or maliciously destroy or damage the latter’s property, the Convention might successfully be pleaded as the sole gauge to determine the carrier’s liability to the passenger, Neither may the Convention be invoke justify the disregard of some extraordinary sort of damage resulting to a passenger and preclude recovery therefore beyond the limits set by said Convention. It is in this sense that the Convention has been applied, or ignored, depending on the peculiar facts presented by each case."cralaw virtua1aw library

The Court thus sees no error in the preponderant application to the instant case by the appellate court, as well as by the trial court, of the usual rules on the extent of recoverable damages beyond the Warsaw limitations. Under domestic law and jurisprudence (the Philippines being the country of destination), the attendance of gross negligence (given the equivalent of fraud or bad faith) holds the common carrier liable for all damages which can be reasonably attribute, although unforeseen, to the non-performance of the obligation, 9 including moral and exemplary damages. 10

WHEREFORE, the decision appealed from is AFFIRM. Costs against petitioner.

SO ORDERED.

Padilla, Bellosillo, Kapunan and Hermosisima, Jr., JJ., concur.

Endnotes:



1. Association Justice Alicia V. Sempio Diy, ponente; concurred in by Associate Justices Oscar M. Herrera and Artemio D. Luna.

2. Rollo, p. 37-39

3. Rollo, p. 36

4. Rollo, p. 4

5. Rollo, pp. 42-44

6. See Singson v. Bank of P.I., 23 SCRA 1117; Air France v. Carrascoso; 18 SCRA 155.

7. Vda. de Bataclan v. Medina, 102 Phil. 181,186.

8. 192 Scra 9, 16-18.

9. See Art. 2201, in relation to Art. 1764, Civil Code.

10. See Art. 2220, Civil; See Gatchalian v. Delim, 203 SCRA 126.

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