AIR FRANCE, PETITIONER, VS. THE COURT OF APPEALS AND NARCISO O. MORALES, RESPONDENTS.

This is a petition for review on certiorari of the
decision* of the Court of Appeals, dated 4 April 1986, in
CA-G.R. CV. No. 69875, entitled “Narciso Morales
vs. Air France,” dismissing herein petitioner’s appeal from the adverse
ruling of the trial court (Branch 33, CFI of Rizal, Kalookan City)** and the
latter’s denial of its motion for reconsideration.  The respondent Court of Appeals likewise
denied petitioner’s motion for reconsideration of its decision in a resolution dated 25 September 1986.

In reviewing the records, we find:

Sometime in October 1977, private respondent Narciso
Morales thru his representative, Ms. Janet Tolentino,
pur­chased an airline ticket from Aspac Management
Corporation, petitioner’s General Sales Agent in Makati,
for P9,426.00 Plus P1,413.90 travel tax, of which P413.90 were later refunded
to Ms. Tolentino.

The itinerary covered by the ticket included several cities, with
certain segments thereof restricted by markings of “non endorsable”
and “valid on AF (meaning Air France)
only”, as herein specified:

While in New York, U.S.A.
on 3 November 1977, private
respondent Morales obtained three (3) medical certificates (Exhibits G, G-1,
G-2) attesting to an ear infection which necessitated medical treatment.  From New York,
he flew to Paris, Stockholm
and then Copenhagen where he made
representations with petitioner’s office to shorten his trip by deleting some
of the cities in the itinerary. 
Respondent Morales was informed that, as a matter of procedure, confir­mation of petitioner’s office
in Manila (as ticketing office)
must be secured before shortening of the route (already paid for).  Air France
in Amsterdam telexed AF Manila
requesting for rerouting of the passenger to Amster­dam,
Hamburg, Geneva,
Rome, Hongkong,
Manila.^[2]

As there was no immediate response to the telex, res­pondent
proceeded to Hamburg where he was
informed of AF Manila’s negative reply. 
After reiterating his need to fly home on a shorter route due to his ear
infection, and presentation of supporting medical certificates, again, the
airline office made the necessary request to Manila on 23 November 1977 for a
Hamburg, Paris, Geneva, Rome, Paris, Hongkong and
Manila route.  Still, the request was
denied.  Despite respondent’s protest and
offer to pay any fare diffe­rence, petitioner did not relent in its position. 
Respon­dent, therefore, had to buy an entirely new set of tickets,
paying 1,914 German marks for the homeward route, namely:

“Itinerary                         Carrier                          Date                        Reservation

Hamburg/Frankfurt                   LH                             26
Nov.                           OK

(Lufthansa)

Frankfurt/Geneva                     SR                            26
Nov.                           OK

( Swissair)

Geneva/Rome                          AZ                             29 Nov.                           OK

(Alitalia)

Rome/Hongkong                      BA                            02 Dec.                          OK

(British Airways)

Hongkong/Manila                      PR                             Open                           Open

(Philippine Airlines)”^[3]

Upon arrival in Manila,
respondent sent a letter-com­plaint to Air France
dated 20 December 1977
thru Aspac Management Corporation.  Respondent Morales was advised to surrender
the unused flight coupons for a refund of its value, but he kept the same and, instead,
filed a complaint for breach of contract of carriage and damages.

CFI Judge Marcelino Sayo
found Air France
in evident bad faith for violation of the contract of carriage, aggravated by
the threatening attitude of its employees in Hamburg.  Considering
the social and economic standing of respondent, who is chairman of the board of
directors of a multi-million corporation and a member of several civic and business organizations, an
award of moral and exemplary damages, in addition to the actual damages
incurred, was deemed proper under the circumstances.  The dispositive
part of the CFI decision states:

“WHEREFORE, this Court hereby renders judgment for the
plaintiff and orders the defendant to pay to the plaintiff the sum of 1,914
German Marks, in its equivalent in Philippine Peso, as actual damages, the sum
of P1,000,000.00 as moral damages, and the further sum of P800,000.00 as
exemplary damages, with legal interest thereon from date of the filing of the
complaint until fully paid, plus the sum equal to 20% thereof as attorney’s
fees, with costs against the plaintiff.”^[4]

On appeal to the Court of Appeals, the award of damages was
modified as follows:

“ACCORDINGLY, the judgment appealed from is hereby modified so
that it will read as follows: Judgment is hereby rendered in favor of the
plaintiff against the defendant ordering the defendant to pay to said plaintiff
the following:

(1) 1,914 German
Marks in its equivalent in Philippine peso at prevailing rate of exchange as
actual damages, with legal interest thereon from the date of the filing of the
complaint until fully paid;

(2) P500,000.00, as moral damages;

(3) P150,000.00, as exemplary damages; and

(4) 5% of the amount
of actual, moral and exemplary damages which are recoverable, as attorney’s
fees.”^[5]

Questioning the factual findings of the respondent court,
petitioner comes to this Court for review citing three (3) errors:

1. The conclusion
that there is a breach of contract is premised on a misapprehension of
facts.

2. Failure to apply
the doctrine of avoidable consequence in the present case.

3. Award of
exorbitant damages and attorney’s fees.

After considering respondent’s comment, the Court resolved to
give due course to the petition, and required the parties to file their
respective memoranda.  Complying with the
resolution of 26 October 1987,
private respondent filed his reply memorandum on 17 December 1987. 
This is the last pleading on record.

While this Court is not a trier of
facts, yet, when the findings of respondent court are without citation of
specific evidence on which they are based, there is suffi­cient reason for the
Court to review the appellate court’s decision.^[6]

The respondent court’s ruling that there was breach of contract
of carriage is premised on petitioner’s refusal to reroute respondent and, in
effect, requiring him to purchase a new set of tickets.  Petitioner refutes this conclusion, claiming
that the original ticket was discounted and non–endorsable
on certain segments. 
Eventually respondent flew on his chosen route with different airlines.

Under the factual milieu, was there really a breach of contract
of carriage on the part of the petitioner, as to justify the award to private
respondent of actual, moral and exemplary damages? We find none.

International Air Transport Association (IATA) Resolu­tion No.
275 e, 2., special note, reads: “Where a fare is restricted and such
restrictions are not clearly evident from the required entries on the ticket,
such restrictions may be written, stamped or reprinted in plain language in the
“Endorsements/Restrictions” box of the applicable flight coupon(s); or
attached thereto by use of an appropriate notice,”^[7]
Voluntary changes to tickets,^[8]
while allow­able, are also covered by IATA Resolution No. 1013, Art. II. which provides: “1. changes to the
ticket requested by the passenger will be subject to carriers
regulations.”

Private respondent wanted a rerouting to Hamburg,
Geneva, Rome,
Hongkong and Manila^[9]
which shortened the original itinerary on the ticket issued by AF Manila
through ASPAC, its general sales agent. 
Considering the original restrictions on the ticket, it was not
unreasonable for Air France
to deny the request.

Besides, a recurring ear infection was pleaded as reason
necessitating urgent return to Manila.  Assuming arguendo
a worsening pain or discomfort, private respondent appears to have still
proceeded to four (4) other cities covering a period of at least six (6) days
and leaving open his date of departure from Hongkong
to Manila.^[10]
And, even if he claimed to have undergone medical examination upon arrival in Manila,
no medical certificate was presented.  He
failed to even remember his date of arrival in Manila.

With a claim for a large amount of damages, the Court finds it
unusual for respondent, a lawyer, to easily forget vital information to
substantiate his plea.  It is also
essential before an award of damages that the claimant must satisfactorily
prove during the trial the existence of the factual basis of the damages and its causal connection to
defendant’s acts.^[11]

In KLM Royal Dutch
Airlines v. CA,^[12]
the Court observed –

“xxx. As noted by the Court of Appeals that condition was
printed in letters so small that one would have to use a magnifying glass to read the words.  Under the circumstances, it would be unfair
and inequitable to charge the respondents with automatic knowledge or
notice of the said condition so as to preclude any doubt that it was fairly and
freely agreed upon by the respondents when they accepted the passage tickets
issued to them by the KLM.  As the
airline which issued those tickets with the knowledge that the respondents
would be flown on the various legs of their journey by different air carriers, the
KLM was chargeable with the duty and responsibility of specifically infor­ming
the respondents of conditions prescribed in their tickets or, in the very
least, to ascer­tain that
the respondent read them before they accepted their passage tickets.  A thorough search of the records, however,
inexplicably fails to show that any effort was exerted by the KLM officials or
employees to discharge in a proper manner this responsibility to the
respondents.  Consequently, We hold that
the respondents cannot be bound by the provision in question by which KLM
unilaterally assumed the role of a mere-ticket-issuing agent for other
airlines and limited its liability only to untoward occurrences on its own
lines.” (emphasis supplied)

Unlike in the KLM case where the breach of contract was
aggravated by the discourteous and arbitrary conduct of an official of the Aer Lingus which the KLM had
engaged to transport the respondents, here. 
Air France
employees in Hamburg informed
private respondent that his tickets were partly stamped
“non-endorsable” and “valid on Air France
only.”^[13]
Mere refusal to accede to the passenger’s wishes does not necessarily translate
into damages in the absence of bad faith.^[14]
To our mind, respondent has failed to show wanton, malevolent or reckless
misconduct imputable to petitioner in its refusal to reroute.

Air France Manila acted
upon the advise of ASPAC in denying private respondent’s request.  There was no evident
bad faith when it followed the advise not to authorize rerouting.^[15] At worst, the situation can be considered a
case of inadvertence on the part of ASPAC in not explaining the non-endorsable
character of the ticket.  Of importance,
however, is the fact that private respondent is a lawyer, and the restriction box^[16] clearly indicated the non?endorsable
character of the ticket.

Omissions by ordinary
passengers may be condoned but more is expected of
members of the bar who cannot feign ignorance of such limitations and restrictions.  An award of moral and exemplary damages
cannot be sustained under the circumstances, but petitioner has to refund the
unused coupons in the Air France ticket issued to the private respondent.

WHEREFORE, the judgement
appealed from is REVERSED and SET ASIDE.  Petitioner is ordered, however, to refund to
private respondent the value or the
unused coupons in the passenger’s ticket issued to him by the petitioner.  No costs.

SO ORDERED.

Melencio-Herrera, (Chairman), Paras, Sarmiento, and Regalado, JJ., concur.

* Justice Desiderio
Jurado, ponente; Justices Crisolito Pascual, Jose Campos
and Serafin E. Camilon,
concurring.

** Presided by Judge Marcelino Sayo.

^[1]
Appellant’s Brief, p. 7

^[2]
Deposition of Mrs. R. Schaale, q. #35, p. 7, Folder
of ‘Defendants’ Exhibits, Original Records, CFI, Br. 33, Kalookan
City

^[3]
Rollo, p. 26

^[4]
Amended Record on Appeal, P. 78

^[5]
Rollo, p. 67

^[6]
Apex Investment & Financing Corp. and Jose S.J. Villarica vs. IAC, Crown Radio Corp. Phil., G.R. No.
69723, October 18, 1988

^[7]
In addition, where a fare and such restrictions are not clearly evident from
the required entries on the ticket, such restrictions may be written, stamped
or pre-printed in plain language in the ‘Endorsements/Restrictions’ box of the
applicable flight coupon(s); or attached thereto by use of an appropriate
notice. In addition, where a fare is restricted to time of travel or period of
validity, a special fare notice similar to that shown below, may be used:

IMPORTANT NOTICE

This is a ‘SPECIAL FARE’ Ticket which involves travel restrictions.
Certain ‘Special Fares’ do not permit cancellation, change of reservations or
refund of full amount paid.

^[8]
Governed by IATA Resolution No. 279

^[9]
Governed by General Conditions of Carriage [Passenger] changes to ticket or
schedules. missed connections, changes requested by passenger.

^[10]
Deposition Answer to Question No. 79. p. 14. Folder of Defendants’ Exhibits.
Original Records. CFI. Br.
33. Kaloocan
City.

^[11]
Makabali v. CA, G.R. No. L-46877, January 22, 1988

^[12]
65 SCRA 237, G.R. No. L-31150. July
22, 1975

^[13]
Deposition Answer to Question No. 86, p. 17, Folder of Defendants’ Exhibits. Original Records, CFI. Br. 33, Kalookan City.

^[14]
TWA v. Court of Appeals and Rogelio Vintuan,
G.R. No. 78656, August 30, 1988, KLM Royal Dutch Airlines v. CA, July
25, 1975, 65 SCRA 237; Ortigas, Jr. Lufthansa German
Airlines, June 30, 1975, 64 SCRA 610; Zulueta v.
Pan Am World Airways, Inc., 43 SCRA 397; Korean Airlines Co., Ltd, v.
CA, G .R. No. 61416, 29 September 1987

^[15]
TSN, February 26, 1979, pp.
200-202.

^[16]
Exhibits 2-A, 3-A-2, 3-B-2