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Transportation Case Digest: Korean Airlines Co. LTd v. CA (1994)

G.R. No. 114061 August 3, 1994

Lessons Applicable: Actionable Document (Transportation)

  • 1980: Juanito C. Lapuz, an automotive electrician, was contracted for employment in Jeddah, Saudi Arabia, for a period of 1 year through Pan Pacific Overseas Recruiting Services, Inc. Lapuz was supposed to leave on November 8, 1980, via Korean Airlines. 
    • initially, he was "wait-listed," (accommodated if any of the confirmed passengers failed to show up)
      • When 2 passengers did not appear, Lapuz and another person by the name of Perico were given the seats.
  • Lapuz: he was allowed to check in with 1 suitcase and 1 shoulder bag at the check-in counter of KAL. He passed through the customs and immigration sections for routine check-up and was cleared for departure as Passenger No. 157 of KAL Flight No. KE 903. Together with the other passengers, he rode in the shuttle bus and proceeded to the ramp of the KAL aircraft for boarding. However, when he was at the third or fourth rung of the stairs, a KAL officer pointed to him and shouted "Down! Down!" He was thus barred from taking the flight. When he later asked for another booking, his ticket was canceled by KAL. Consequently, he was unable to report for his work in Saudi Arabia within the stipulated 2-week period and so lost his employment.
  • KAL: Pan Pacific Recruiting Services Inc. coordinated with KAL for the departure of 30 contract workers, of whom only 21 were confirmed and 9 were wait-listed passengers. The agent of Pan Pacific, Jimmie Joseph, after being informed that there was a possibility of having one or two seats becoming available, gave priority to Perico, who was one of the supervisors of the hiring company in Saudi Arabia. The other seat was won through lottery by Lapuz. However, only one seat became available and so, pursuant to the earlier agreement that Perico was to be given priority, he alone was allowed to board.
  • RTC: KAL to pay Lapuz
  • CA: Affirmed with modifications - the amount of actual damages and compensatory damages is reduced to P60K and P100,000.00 moral and exemplary damages, at 6% interest per annum from the date of the filing of the Complaint until fully paid
ISSUE: W/N there was a contract of carriage 

HELD: YES. Affirmed
  • The status of Lapuz as standby passenger was changed to that of a confirmed passenger when his name was entered in the passenger manifest of KAL for its Flight No. KE 903. His clearance through immigration and customs clearly shows that he had indeed been confirmed as a passenger of KAL in that flight. his baggage had already been loaded in KAL's aircraft, to be flown with him to Jeddah. KAL thus committed a breach of the contract of carriage between them when it failed to bring Lapuz to his destination.
  • contract to transport passengers is different in kind and degree from any other contractual relation
    • The contract of air carriage generates a relation attended with a public duty
    • Passengers have the right to be treated by the carrier's employees with kindness, respect, courtesy and due consideration
    • They are entitled to be protected against personal misconduct, injurious language, indignities and abuses from such employees
      • any discourteous conduct on the part of these employees toward a passenger gives the latter an action for damages against the carrier
  • The breach of contract was aggravated in this case when, instead of courteously informing Lapuz of his being a "wait-listed" passenger, a KAL officer rudely shouted "Down! Down!" while pointing at him, thus causing him embarrassment and public humiliation
  • Korean Air Lines acted in a wanton, fraudulent, reckless, oppressive or malevolent manner when it "bumped off" plaintiff-appellant on November 8, 1980, and in addition treated him rudely and arrogantly as a "patay gutom na contract worker fighting Korean Air Lines," which clearly shows malice and bad faith, thus entitling plaintiff-appellant to moral damages.amount 
    • awarded should not be palpably and scandalously excessive
  • A perusal of the plaintiff-appellant's contract of employment shows that the effectivity of the contract is for only one year, renewable every year for five years. Although plaintiff-appellant intends to renew his contract, such renewal will still be subject to his foreign employer. Plaintiff-appellant had not yet started working with his foreign employer, hence, there can be no basis as to whether his contract will be renewed by his foreign employer or not. Thus, the damages representing the loss of earnings of plaintiff-appellant in the renewal of the contract of employment is at most speculative
  • CA did not err in sustaining the trial court's dismissal of KAL's counterclaim against Pan Pacific Overseas Recruiting Services Inc., whose responsibility ended with the confirmation by KAL of Lapuz as its passenger in its Flight No. 903.