G.R. No. L-22425; August 31, 1965
NORTHWEST AIRLINES, INC., petitioner, vs. NICOLAS L. CUENCA and COURT OF APPEALS (SPECIAL SIXTH DIVISION), respondents.

FACTS

Petitioner Northwest Airlines, Inc. was sentenced by the Court of First Instance of Manila to pay respondent Nicolas L. Cuenca moral damages, exemplary damages, attorney’s fees, and litigation expenses for breach of contract of carriage. The Court of Appeals affirmed the decision but eliminated the exemplary damages and converted the award for moral damages into nominal damages. The case is before the Supreme Court on a petition for review. Respondent Cuenca, then the Commissioner of Public Highways and an official delegate to a conference in Tokyo, held a first-class ticket from Manila to Tokyo. He boarded the petitioner’s plane in Manila and was given first-class accommodation. Upon arrival at Okinawa, he was transferred to the tourist class compartment. Despite revealing his official capacity, an agent of the petitioner rudely compelled him, in the presence of other passengers and under threat of being left in Okinawa, to move to tourist class. To reach the conference on time, respondent complied. His ticket was marked “W/L” (wait-listed), but his attention was not called to this notation, nor was he advised of its meaning. Petitioner has not alleged or explained that the person who took respondent’s first-class seat had a better right to it.

ISSUE

1. Whether the Warsaw Convention of October 12, 1929, is in force in the Philippines and limits the carrier’s liability.
2. Whether respondent has a cause of action against petitioner.
3. Whether the award of P20,000 as nominal damages is proper.

RULING

1. The Supreme Court deemed it unnecessary to rule on the first issue regarding the Warsaw Convention’s force, as the resolution of the second issue renders it moot.
2. Yes, respondent has a cause of action. Petitioner’s argument that the Warsaw Convention (Articles 17, 18, and 19) limits carrier liability only to cases of death, injury, loss/damage to baggage/goods, or delay is incorrect. These articles merely declare carrier liability in those enumerated cases but do not regulate or exclude liability for other breaches of contract. Under petitioner’s theory, an air carrier would be absurdly exempt from liability for a bad faith refusal to comply with a contract of carriage.
3. Yes, the award of P20,000 as nominal damages is proper. The cited cases (Medina vs. Cresencia and Quijano vs. Philippine Air Lines) are inapplicable. In Medina, nominal damages were eliminated because compensatory, moral, and exemplary damages were already awarded, and nominal damages cannot co-exist with compensatory damages. Here, the Court of Appeals awarded no such compensatory, moral, or exemplary damages to respondent. Special reasons justify the award: petitioner’s agent acted in a wanton, reckless, and oppressive manner with full knowledge that respondent was an official representative of the Republic of the Philippines. The sum may be considered merely nominal or, alternatively, as exemplary damages given the circumstances. The decision appealed from is affirmed.