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AIR FRANCE V. CARRASCOSO (28 SEPT 1966) - KAREN Topic: No double recovery rule Note: Weve read this case before for Civpro I think.

EMERGENCY
Air France, through its authorized agent (PAL) issued to CARRASCOSO a "first class" round trip airplane ticket from Manila to Rome. From Manila to Bangkok, CARRASCOSO travelled in "first class", but at Bangkok, the Manager of the AIR FRANCE airline forced CARRASCOSO to vacate the "first class" seat that he was occupying because, there was a "white man", who, the Manager alleged, had a "better right" to the seat. When asked to vacate his "first class" seat, CARRASCOSO refused, and told AIR FRANCE's Manager that his seat would be taken over his dead body; a commotion ensued, and, according to said witness Ernesto G. Cuento, "many of the Filipino passengers got nervous in the tourist class; when they found out that Mr. Carrascoso was having a hot discussion with the manager, they came all across to Mr. Carrascoso and pacified Mr. Carrascoso to give his seat to the white man"; and CARRASCOSO reluctantly gave his "first class" seat in the plane. CFI-Manila sentenced AIR FRANCE to pay CARRASCOSO P25,000.00 by way of moral damages; P10,000.00 as exemplary damages; P393.20 representing the difference in fare between first class and tourist class for the portion of the trip Bangkok-Rome, these various amounts with interest at the legal rate, from the date of the filing of the complaint until paid; plus P3,000.00 for attorneys' fees; and the costs of suit. On appeal, the CA slightly reduced the amount of refund on Carrascoso's plane ticket from P393.20 to P383.10, (Karen: the case did not say why this amount was reduced) and voted to affirm the appealed decision "in all other respects", with costs against AIR FRANCE. The case is now before the SC for review on certiorari.

SC: It is really correct to say that the Court of Appeals in the quoted portion first transcribed did not use the term "bad faith". But can it be doubted that the recital of facts therein points to bad faith? The manager not only prevented Carrascoso from enjoying his right to a first class seat; worse, he imposed his arbitrary will; he forcibly ejected him from his seat, made him suffer the humiliation of having to go to the tourist class compartment - just to give way to another passenger whose right thereto has not been established. Certainly, this is bad faith. Unless, of course, bad faith has assumed a meaning different from what is understood in law. For, "bad faith" contemplates a "state of mind affirmatively operating with furtive design or with some motive of self-interest or will or for ulterior purpose."

WON the amounts decreed by both the trial court and the Court of Appeals as awards for moral and exemplary damages and attorneys fees as excessive? NO The task of fixing these amounts is primarily with the trial court. The Court of Appeals did not interfere with the same. The dictates of good sense suggest that we give our imprimatur thereto. Because, the facts and circumstances point to the reasonableness thereof. Exemplary damages are well awarded. The Civil Code gives the court ample power to grant exemplary damages in contracts and quasicontracts. The only condition is that defendant should have "acted in a wanton, fraudulent, reckless, oppressive, or malevolent manner." 53 The manner of ejectment of CARRASCOSO from his first class seat fits into this legal precept. And this, in addition to moral damages.54 The right to attorney's fees is fully established. The grant of exemplary damages justifies a similar judgment for attorneys' fees.

COMPLETE DIGEST
1. 2. 3. Plaintiff CARRASCOSO, a civil engineer, was a member of a group of 48 Filipino pilgrims that left Manila for Lourdes on March 30, 1958. March 28, 1958: the defendant, Air France, through its authorized agent, Philippine Air Lines, Inc., issued to CARRASCOSO a "first class" round trip airplane ticket from Manila to Rome. From Manila to Bangkok, CARRASCOSO travelled in "first class", but at Bangkok, the Manager of the AIR FRANCE airline forced CARRASCOSO to vacate the "first class" seat that he was occupying because, in the

Is the CAs award of moral damages correct? YES AIR FRANCE's claims that Carrascoso's that to authorize an award for moral damages there must be an averment of fraud or bad faith; and that the decision of the CA fails to make a finding of bad faith.

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words of the witness Ernesto G. Cuento, there was a "white man", who, the Manager alleged, had a "better right" to the seat. When asked to vacate his "first class" seat, CARRASCOSO, as was to be expected, refused, and told AIR FRANCE's Manager that his seat would be taken over his dead body; a commotion ensued, and, according to said witness Ernesto G. Cuento, "many of the Filipino passengers got nervous in the tourist class; when they found out that Mr. Carrascoso was having a hot discussion with the white man [manager], they came all across to Mr. Carrascoso and pacified Mr. Carrascoso to give his seat to the white man"; and CARRASCOSO reluctantly gave his "first class" seat in the plane. CFI-Manila sentenced AIR FRANCE to pay CARRASCOSO P25,000.00 by way of moral damages; P10,000.00 as exemplary damages; P393.20 representing the difference in fare between first class and tourist class for the portion of the trip Bangkok-Rome, these various amounts with interest at the legal rate, from the date of the filing of the complaint until paid; plus P3,000.00 for attorneys' fees; and the costs of suit. On appeal, the CA slightly reduced the amount of refund on Carrascoso's plane ticket from P393.20 to P383.10 (Karen: the case did not say why this amount was reduced), and voted to affirm the appealed decision "in all other respects", with costs against AIR FRANCE. The case is now before the SC for review on certiorari.

4.

1st issue: Was Carrascoso entitled to the first class seat he claims? YES
1. It is conceded in all quarters that on March 28, 1958 he paid to and received from AIR FRANCE a first class ticket. But AIR FRANCE asserts that said ticket did not represent the true and complete intent and agreement of the parties; that said CARRASCOSO knew that he did not have confirmed reservations for first class on any specific flight, although he had tourist class protection; that, accordingly, the issuance of a first class ticket was no guarantee that he would have a first class ride, but that such would depend upon the availability of first class seats. These are matters which AIR FRANCE has thoroughly presented and discussed in its brief before the Court of Appeals under its third assignment of error, which reads: "The trial court erred in finding that plaintiff had confirmed reservations for, and a right to, first class seats on the "definite" segments of his journey, particularly that from Saigon to Beirut". And, the Court of Appeals disposed of this contention thus: We are not impressed by such a reasoning. We cannot understand how a reputable firm like defendant airplane company could have the indiscretion to give out tickets it never meant to honor at all. It received the corresponding amount in payment of first-class tickets and yet it allowed the passenger to be at the mercy of its employees. It is more in keeping with the ordinary course of business that the company should know whether or not the tickets it issues are to be honored or not. Note that the CFI-Manila similarly disposed of AIR FRANCE's contention. CFI-Manila found that AIR FRANCEs own witness, Rafael Altonaga, confirmed CARRASCOSO's testimony and testified as follows:

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ISSUES: 1. Was Carrascoso entitled to the first class seat he claims? YES 2. Is the CAs award of moral damages correct? YES 3. WON the finding of the Court of Appeals that the purser made an entry in his notebook reading "First class passenger was forced to go to the tourist class against his will, and that the captain refused to intervene" is predicated upon incompetent evidence? NO 4. WON the amounts decreed by both the trial court and the Court of Appeals as awards for moral and exemplary damages and attorneys fees as excessive? NO HELD: On balance, we say that the judgment of the Court of Appeals does not suffer from reversible error. We accordingly vote to affirm the same. Costs against AIR FRANCE. So ordered. RATIO:

4.

Q. In these tickets there are marks "O.K." From what you know, what does this OK mean? A. That the space is confirmed. Q. Confirmed for first class? A. Yes, "first class". (Transcript, p. 169)
5. We have heretofore adverted to the fact that except for a slight difference of a few pesos in the amount refunded on Carrascoso's ticket, the decision of the Court of First Instance was affirmed by the Court of Appeals in all other respects. Implicit in that affirmance is a determination by the Court of Appeals that the proceeding in the Court of First Instance was free from prejudicial error and "all questions raised by

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the assignments of error and all questions that might have been raised are to be regarded as finally adjudicated against the appellant". So also, the judgment affirmed "must be regarded as free from all error". We reached this policy construction because nothing in the decision of the CA on this point would suggest that its findings of fact are in any way at war with those of the trial court. Nor was said affirmance by the Court of Appeals upon a ground or grounds different from those which were made the basis of the conclusions of the trial court. xxx xxx xxx

2. That likewise, as a result of defendant's failure to furnish First Class accommodations aforesaid, plaintiff suffered inconveniences, embarrassments, and humiliations, thereby causing plaintiff mental anguish, serious anxiety, wounded feelings, social humiliation, and the like injury, resulting in moral damages in the amount of P30,000.00. xxx 2. xxx xxx

2nd issue: Is the CAs award of moral damages correct? YES

1. AIR FRANCE assails the court's award of moral damages. AIR FRANCE's trenchant claim is that Carrascoso's action is planted upon breach of contract; that to authorize an award for moral damages there must be an averment of fraud or bad faith; and that the decision of the CA fails to make a finding of bad faith. The pivotal allegations in the complaint bearing on this issue are: 3. That ... plaintiff entered into a contract of air carriage with the Philippine Air Lines for a valuable consideration, the latter acting as general agents for and in behalf of the defendant, under which said contract, plaintiff was entitled to, as defendant agreed to furnish plaintiff, First Class passage on defendant's plane during the entire duration of plaintiff's tour of Europe with Hongkong as starting point up to and until plaintiff's return trip to Manila, ... . 4. That, during the first two legs of the trip from Hongkong to Saigon and from Saigon to Bangkok, defendant furnished to the plaintiff First Class accommodation but only after protestations, arguments and/or insistence were made by the plaintiff with defendant's employees. 5. That finally, defendant failed to provide First Class passage, but instead furnished plaintiff only Tourist Class accommodations from Bangkok to Teheran and/or Casablanca, ... the plaintiff has been compelled by defendant's employees to leave the First Class accommodation berths at Bangkok after he was already seated. 6. That consequently, the plaintiff, desiring no repetition of the inconvenience and embarrassments brought by defendant's breach of contract was forced to take a Pan American World Airways plane on his return trip from Madrid to Manila.32

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The foregoing, in our opinion, substantially aver: First, That there was a contract to furnish plaintiff a first class passage covering, amongst others, the Bangkok-Teheran leg; Second, That said contract was breached when AIR FRANCE failed to furnish first class transportation at Bangkok; and Third, that there was bad faith when AIR FRANCE's employee compelled Carrascoso to leave his first class accommodation berth "after he was already, seated" and to take a seat in the tourist class, by reason of which he suffered inconvenience, embarrassments and humiliations, thereby causing him mental anguish, serious anxiety, wounded feelings and social humiliation, resulting in moral damages. It is true that there is no specific mention of the term bad faith in the complaint. But, the inference of bad faith is there, it may be drawn from the facts and circumstances set forth therein. 34 The contract was averred to establish the relation between the parties. But the stress of the action is put on wrongful expulsion. Quite apart from the foregoing is that (a) right at the start of the trial, CARRASCOSO's counsel placed AIR FRANCE on guard on what Carrascoso intended to prove: That while sitting in the plane in Bangkok, Carrascoso was ousted by AIR FRANCE's manager who gave his seat to a white man; 35 and (b) evidence of bad faith in the fulfillment of the contract was presented without objection on the part of the AIR FRANCE. It is, therefore, unnecessary to inquire as to whether or not there is sufficient averment in the complaint to justify an award for moral damages. Deficiency in the complaint, if any, was cured by the evidence. An amendment thereof to conform to the evidence is not even required. 36 On the question of bad faith, the Court of Appeals declared: That the plaintiff was forced out of his seat in the first class compartment of the plane belonging to the defendant Air France while at Bangkok, and was transferred to the tourist class not only without his consent but against his will, has been sufficiently established by plaintiff in his testimony before the court, corroborated by the

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corresponding entry made by the purser of the plane in his notebook which notation reads as follows: "First-class passenger was forced to go to the tourist class against his will, and that the captain refused to intervene", and by the testimony of an eye-witness, Ernesto G. Cuento, who was a co-passenger. The captain of the plane who was asked by the manager of defendant company at Bangkok to intervene even refused to do so. It is noteworthy that no one on behalf of defendant ever contradicted or denied this evidence for the plaintiff. It could have been easy for defendant to present its manager at Bangkok to testify at the trial of the case, or yet to secure his disposition; but defendant did neither. 4. The Court of appeals further stated Neither is there evidence as to whether or not a prior reservation was made by the white man. Hence, if the employees of the defendant at Bangkok sold a first-class ticket to him when all the seats had already been taken, surely the plaintiff should not have been picked out as the one to suffer the consequences and to be subjected to the humiliation and indignity of being ejected from his seat in the presence of others. Instead of explaining to the white man the improvidence committed by defendant's employees, the manager adopted the more drastic step of ousting the plaintiff who was then safely ensconsced in his rightful seat. We are strengthened in our belief that this probably was what happened there, by the testimony of defendant's witness Rafael Altonaga who, when asked to explain the meaning of the letters "O.K." appearing on the tickets of plaintiff, said "that the space is confirmed for first class. Likewise, Zenaida Faustino, another witness for defendant, who was the chief of the Reservation Office of defendant, testified as follows: "Q How does the person in the ticket-issuing office know what reservation the passenger has arranged with you? A They call us up by phone and ask for the confirmation." In this connection, we quote with approval what the trial Judge has said on this point:

Why did the, using the words of witness Ernesto G. Cuento, "white man" have a "better right" to the seat occupied by Mr. Carrascoso? The record is silent. The defendant airline did not prove "any better", nay, any right on the part of the "white man" to the "First class" seat that the plaintiff was occupying and for which he paid and was issued a corresponding "first class" ticket. If there was a justified reason for the action of the defendant's Manager in Bangkok, the defendant could have easily proven it by having taken the testimony of the said Manager by deposition, but defendant did not do so; the presumption is that evidence willfully suppressed would be adverse if produced [Sec. 69, par (e), Rules of Court]; and, under the circumstances, the Court is constrained to find, as it does find, that the Manager of the defendant airline in Bangkok not merely asked but threatened the plaintiff to throw him out of the plane if he did not give up his "first class" seat because the said Manager wanted to accommodate, using the words of the witness Ernesto G. Cuento, the "white man".38 5. It is really correct to say that the Court of Appeals in the quoted portion first transcribed did not use the term "bad faith". But can it be doubted that the recital of facts therein points to bad faith? The manager not only prevented Carrascoso from enjoying his right to a first class seat; worse, he imposed his arbitrary will; he forcibly ejected him from his seat, made him suffer the humiliation of having to go to the tourist class compartment - just to give way to another passenger whose right thereto has not been established. Certainly, this is bad faith. Unless, of course, bad faith has assumed a meaning different from what is understood in law. For, "bad faith" contemplates a "state of mind affirmatively operating with furtive design or with some motive of self-interest or will or for ulterior purpose." And if the foregoing were not yet sufficient, there is the express finding of bad faith in the judgment of the Court of First Instance, thus: The evidence shows that the defendant violated its contract of transportation with plaintiff in bad faith, with the aggravating circumstances that defendant's Manager in Bangkok went to the extent of threatening the plaintiff in the presence of many passengers to have him thrown out of the

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airplane to give the "first class" seat that he was occupying to, again using the words of the witness Ernesto G. Cuento, a "white man" whom he (defendant's Manager) wished to accommodate, and the defendant has not proven that this "white man" had any "better right" to occupy the "first class" seat that the plaintiff was occupying, duly paid for, and for which the corresponding "first class" ticket was issued by the defendant to him.40 7. The responsibility of an employer for the tortious act of its employees need not be essayed. It is well settled in law. 41 For the willful malevolent act of AIR FRANCE's manager, AIR FRANCE, his employer, must answer. Article 21 of the Civil Code says: ART. 21. Any person who willfully causes loss or injury to another in a manner that is contrary to morals, good customs or public policy shall compensate the latter for the damage. In parallel circumstances, we applied the foregoing legal precept; and, we held that upon the provisions of Article 2219 (10), Civil Code, moral damages are recoverable. 42 8. A contract to transport passengers is quite different in kind and degree from any other contractual relation. 43 And this, because of the relation which an air-carrier sustains with the public. Its business is mainly with the travelling public. It invites people to avail of the comforts and advantages it offers. The contract of air carriage, therefore, generates a relation attended with a public duty. Neglect or malfeasance of the carrier's employees, naturally, could give ground for an action for damages. 9. Passengers do not contract merely for transportation. They have a 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. So it is, that any rule or discourteous conduct on the part of employees towards a passenger gives the latter an action for damages against the carrier. 10. Thus, "Where a steamship company 45 had accepted a passenger's check, it was a breach of contract and a tort, giving a right of action for its agent in the presence of third persons to falsely notify her that the check was worthless and demand payment under threat of ejection, though the language used was not insulting and she was not ejected." 46 And this, because, although the relation of passenger and carrier is "contractual both

in origin and nature" nevertheless "the act that breaks the contract may be also a tort". 47 And in another case, "Where a passenger on a railroad train, when the conductor came to collect his fare tendered him the cash fare to a point where the train was scheduled not to stop, and told him that as soon as the train reached such point he would pay the cash fare from that point to destination, there was nothing in the conduct of the passenger which justified the conductor in using insulting language to him, as by calling him a lunatic," 48 and the Supreme Court of South Carolina there held the carrier liable for the mental suffering of said passenger. 11. AIR FRANCE's contract with Carrascoso is one attended with public duty. The stress of Carrascoso's action as we have said, is placed upon his wrongful expulsion. This is a violation of public duty by the AIR FRANCE air carrier a case of quasi-delict. Damages are proper.

3rd issue: WON the finding of the Court of Appeals that the purser made an entry in his notebook reading "First class passenger was forced to go to the tourist class against his will, and that the captain refused to intervene" is predicated upon incompetent evidence? NO
12. AIR FRANCE charges that the finding of the Court of Appeals that the purser made an entry in his notebook reading "First class passenger was forced to go to the tourist class against his will, and that the captain refused to intervene" is predicated upon evidence [Carrascoso's testimony above] which is incompetent. We do not think so. The subject of inquiry is not the entry, but the ouster incident. Testimony on the entry does not come within the proscription of the best evidence rule. Such testimony is admissible. 49a 13. Besideswhen the dialogue happened, the impact of the startling occurrence was still fresh and continued to be felt. The excitement had not as yet died down. Statements then, in this environment, are admissible as part of the res gestae. 50 For, they grow "out of the nervous excitement and mental and physical condition of the declarant". 51 The utterance of the purser regarding his entry in the notebook was spontaneous, and related to the circumstances of the ouster incident. Its trustworthiness has been guaranteed. 52 It thus escapes the operation of the hearsay rule. It forms part of the res gestae. 14. At all events, the entry was made outside the Philippines. And, by an employee of AIR FRANCE. It would have been an easy matter for AIR FRANCE to have contradicted Carrascoso's testimony. If it were really true

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that no such entry was made, the deposition of the purser could have cleared up the matter. 15. We, therefore, hold that the transcribed testimony of Carrascoso is admissible in evidence.

4th Issue: WON the amounts decreed by both the trial court and the Court of Appeals as awards for moral and exemplary damages and attorneys fees as excessive? NO

16. Questioned as excessive are the amounts decreed by both the trial court and the Court of Appeals, thus: P25,000.00 as moral damages; P10,000.00, by way of exemplary damages, and P3,000.00 as attorneys' fees. The task of fixing these amounts is primarily with the trial court. The Court of Appeals did not interfere with the same. The dictates of good sense suggest that we give our imprimatur thereto. Because, the facts and circumstances point to the reasonableness thereof. 17. Exemplary damages are well awarded. The Civil Code gives the court ample power to grant exemplary damages in contracts and quasicontracts. The only condition is that defendant should have "acted in a wanton, fraudulent, reckless, oppressive, or malevolent manner." 53 The manner of ejectment of CARRASCOSO from his first class seat fits into this legal precept. And this, in addition to moral damages.54 18. The right to attorney's fees is fully established. The grant of exemplary damages justifies a similar judgment for attorneys' fees. The least that can be said is that the courts below felt that it is but just and equitable that attorneys' fees be given. 55 We do not intend to break faith with the tradition that discretion well exercised as it was here should not be disturbed.