GR 92501; (March, 1992) (Digest)
G.R. No. 92501 March 6, 1992
PHILIPPINE AIR LINES, petitioner, vs. HON. COURT OF APPEALS and ISIDRO CO, respondents.
FACTS
On April 17, 1985, private respondent Isidro Co arrived at the Manila International Airport via PAL Flight No. 107 from San Francisco. Upon claiming his checked-in baggage, he found only eight of his nine luggages. He immediately notified a PAL employee, who filled out a Property Irregularity Report acknowledging the missing luggage. Co surrendered all nine claim checks, including the one for the missing luggage. The lost Samsonite suitcase contained personal effects worth US$1,243.01 based on invoices, plus gifts valued at about US$500-$600. Despite Co’s follow-ups and a formal demand letter, PAL failed to locate the baggage or pay its value. Co filed a complaint for damages. The Regional Trial Court of Pasay City awarded Co actual damages (P42,766.02), exemplary damages (P20,000.00), attorney’s fees (P10,000.00), and costs. The Court of Appeals affirmed this decision in toto. PAL petitioned for review, arguing that its liability should be limited to US$20.00 under the Warsaw Convention and contesting the factual findings and award of damages.
ISSUE
1. Whether the factual findings of the lower courts regarding the loss of baggage and PAL’s negligence are reviewable.
2. Whether the Warsaw Convention’s limit of liability applies to the loss of Co’s checked-in baggage.
3. Whether the award of actual and exemplary damages, attorney’s fees, and costs to Co is justified.
RULING
1. The factual findings of the lower courts are final and not reviewable by the Supreme Court, as they raise purely factual issues. The trial court’s finding that PAL’s Baggage Retrieval Report was a fabrication, affirmed by the Court of Appeals, is binding. Co surrendered all claim checks, including for the missing luggage, making it impossible for him to produce the check in court.
2. The Warsaw Convention’s limit of liability does not apply. Under Philippine law, specifically Articles 1733, 1735, and 1753 of the New Civil Code, the liability of a common carrier for loss of goods transported to the Philippines is governed primarily by the Code. Since Co’s destination was the Philippines, Philippine law governs. PAL failed to overcome the presumption of negligence under Article 1735 and acted in bad faith by fabricating a retrieval receipt, thus the Convention’s limits are disregarded.
3. The award of damages is justified. Actual damages were proven by invoices and testimony. Exemplary damages and attorney’s fees were properly awarded due to PAL’s bad faith and refusal to satisfy Co’s valid claim, which forced him to litigate. The petition for review is DENIED for lack of merit. Costs against PAL.