14 Sps Zalamea vs. Court of Appeals

Zalamea vs.
Court of Appeals
FACTS:
Spouses Cesar and Suthira Zalamea, and their daughter, Liana Zalamea, purchased three (3) airline
tickets from the Manila agent of respondent TransWorld Airlines, Inc. (TWA) for a flight from New
York to Los Angeles on June 6, 1984. The tickets of the spouses were
purchased at a discount of 75% while that of their daughter was a full fare ticket. All three tickets
represented confirmed reservations.
While in New York, on June 4, 1984, the spouses Zalamea and their daughter received a notice of
reconfirmation of their reservations for said flight. On the appointed date, however, the spouses
Zalamea and their daughter checked in at 10:00 am, an hour earlier than the scheduled flight at 11:00
am but were placed on the wait-list because the number of passengers who checked in before tem
had already taken all the seats available on the flight.
Out of the 42 names on the wait-list, the first 22 names were eventually allowed to board the flight to
Los Angeles, including Cesar Zalamea. The two others, on the other hand, being ranked lower than
22, were not able to fly. As it were, those holding full-fare ticket were given first priority among the
wait-listed passengers. Mr. Zalamea, who was holding the full-fare ticket of his daughter, was allowed
to board the plane; while his wife and daughter, who presented the discounted tickets were denied
boarding. Even in the next TWA flight to Los Angeles, Mrs. Zalamea and her daughter, could not be
accommodated because it was full booked. Thus, they were constrained to book in another flight and
purchased two tickets from American Airlines.
Upon their arrival in the Philippines, the spouses Zalamea filed an action for damages based on
breach of contract of air carriage before the RTC of Makati which rendered a decision in their favor
ordering the TWA to pay the price of the tickets bought from American Airlines together with moral
damages and attorney’s fees. On appeal, the CA held that moral damages are recoverable in a
damage suit predicated upon a breach of contract of carriage only where there is fraud or bad faith. It
further stated that since it is a matter of record that overbooking of flights is a common and accepted
practice of airlines in the United States and is specifically allowed under the Code of Federal
Regulations by the Civil Aeronautics Board, neither fraud nor bad faith could be imputed on TWA.
ISSUE:
Whether or not the CA erred in accepting the finding that overbooking is specifically allowed by the
US Code of Federal Regulations and in holding that there was no fraud or bad faith on the part of
TWA ?
HELD:
The CA was in error. There was fraud or bad faith on the part of TWA when it did not allow Mrs.
Zalamea and her daughter to board their flight for Los Angeles in spite of confirmed tickets. The US
law or regulation allegedly authorizing overbooking has never been proved.
The evidence shows that petitioners Suthira and Liana were constrained to take the American Airlines
flight to Los Angeles not because they “opted not to use their TWA tickets on another TWA flight” but
because respondent TWA could not accommodate them either on the next TWA flight which was also
fully booked. 14 The purchase of the American Airlines tickets by petitioners Suthira and Liana was
the consequence of respondent TWA’s unjustifiable breach of its contracts of carriage with
petitioners.
The Court held that in accordance with Article 2201, the TWA should be responsible for all damages
which may be reasonably attributed to the non-performance of the obligation.
In the previously cited case of Alitalia Airways v. Court of Appeals, 15 this Court explicitly held that a
passenger is entitled to be reimbursed for the cost of the tickets he had to buy for a flight to another
airline. Thus, instead of simply being refunded for the cost of the unused TWA tickets, petitioners
should be awarded the actual cost of their flight from New York to Los Angeles. On this score, we
differ from the trial court’s ruling which ordered not only the reimbursement of the American Airlines
tickets but also the refund of the unused TWA tickets. To require both prestations would have
enabled petitioners to fly from New York to Los Angeles without any fare being paid.
1.) Foreign laws do not prove themselves nor can the court take judicial notice of them. Like any other
fact, they must be alleged and proved. Written law may be evidenced by an official publication thereof
or by a copy attested by the officers having legal custody of the record, or by his deputy and
accompanied with a certificate that such officer has custody. The certificate may be made by a
secretary of an embassy or legation, consul-general, consul, vice-consul, or consular agent or by any
officer in the foreign service of the Phil. stationed in the foreign country in which the record is kept and
authenticated by the seal of his office. Here, TWA relied solely on the testimony of its customer
service agent in her deposition that the Code of Federal Regulations of the Civil Aeronautic Board
allows overbooking. Aside from said statement, no official publication of said code was presented as
evidence. Thus, the CA’s finding that overbooking is specifically allowed by the US Code of Federal
Regulations has no basis in fact.
“That there was fraud or bad faith on the part of respondent airline when it did not allow petitioners to
board their flight for Los Angeles in spite of confirmed tickets cannot be disputed. The U.S. law or
regulation allegedly authorizing overbooking has never been proved. Foreign laws do not prove
themselves nor can the courts take judicial notice of them. Like any other fact, they must be alleged
and proved. Written law may be evidenced by an official publication thereof or by a copy attested by
the officer having the legal custody of the record, or by his deputy, and accompanied with a certificate
that such officer has custody. The certificate may be made by a secretary of an embassy or legation,
consul general, consul, vice-consul, or consular agent or by any officer in the foreign service of the
Philippines stationed in the foreign country in which the record is kept, and authenticated by the seal
of his office.
Respondent TWA relied solely on the statement of Ms. Gwendolyn Lather, its customer service
agent, in her deposition dated January 27, 1986 that the Code of Federal Regulations of the Civil
Aeronautics Board allows overbooking. Aside from said statement, no official publication of said code
was presented as evidence. Thus, respondent court’s finding that overbooking is specifically allowed
by the US Code of Federal Regulations has no basis in fact.”
“Even if the claimed U.S. Code of Federal Regulations does exist, the same is not applicable to the
case at bar in accordance with the principle of lex loci contractus which require that the law of the
place where the airline ticket was issued should be applied by the court where the passengers are
residents and nationals of the forum and the ticket is issued in such State by the defendant airline.
Since the tickets were sold and issued in the Philippines, the applicable law in this case would be
Philippine law.”

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