Passengers win damage suit vs PAL

The Supreme Court has finally resolved a 21-year-old suit filed against Philippine Airlines (PAL) and a travel agency by three Chinese-Filipino traders who missed two business deals in Hong Kong after being bumped off their flight to the Chinese territory.

In an Oct. 17 decision, the Supreme Court’s Third Division denied the PAL’s plea to reverse a 2005 Court of Appeals ruling that awarded damages and payment of attorney’s fees to Francisco Lao Lim, Manuel Limtong and the heirs of the late Henry Go, all of Cebu City.

“Having proven the existence of a contract of carriage between respondents Lim and Go, and the fact of nonperformance by [PAL] of its obligation as a common carrier, it is clear that [PAL] breached its contract of carriage with respondents Lim and Go,” the high court said in a 14-page decision penned by Justice Diosdado Peralta.

Justice Presbitero Velasco Jr., division chair, and the three other division members, Justices Teresita Leonardo-de Castro, Roberto Abad and Jose Mendoza, concurred with the decision.

Lim, Limtong and Go bought round-trip PAL tickets from Rainbow Tours and Travel Inc. on Feb. 22, 1991, for a trip to Hong Kong on Feb. 26 where they were to purchase weighing scales and printing press equipment from two sellers.

They took off from Mactan International Airport in Cebu on Feb. 25 and landed in Manila for their morning flight to Hong Kong the following day. However, at the Ninoy Aquino International Airport, Lim and Go learned their names were not on the passenger list.

Only Limtong was able to take the flight. Lim and Go, both wait-listed, followed on a later flight. However, as Lim and Go were late and Limtong was unable to conduct a proper negotiation, the weighing scale contract was awarded to another buyer while the seller of the printing press equipment left Hong Kong and refused to see them anymore.

The businessmen said they could have made P3.56 million from the deals and consequently sued PAL, then partly government-owned, for damages. They also each claimed P350,000 in moral damages after accusing PAL staff of scolding and humiliating them.

A regional trial court found the 344-seat flight was overbooked by 44 seats. Both the RTC and the Court of Appeals noted that PAL and Rainbow Tours officers had agreed not to tell the traders that their confirmed bookings for the Manila-Hong Kong leg had been erroneously cancelled and that the flight was on critical status due to the overbooking of passengers.

In 1996, the RTC ordered PAL and Rainbow Tours to pay each of the complainants P75,000 in temperate damages and P25,000 in attorney’s fees.

The Court of Appeals increased the award of damages to P200,000 each for exemplary, moral and temperate damages, and the attorney’s fees to P60,000. The Supreme Court modified the decision by deleting the award of moral damages to the deceased Go, as well as the award of temperate damages to Limtong, since he was able to make the flight. Jerome Aning