G.R. No. L-3678; February 29, 1952
JOSE MENDOZA, plaintiff-appellant, vs. PHILIPPINE AIR LINES, INC., defendant-appellee.

FACTS

In 1948, plaintiff-appellant Jose Mendoza, owner of the Cita Theater in Naga, Camarines Sur, contracted with LVN Pictures, Inc. to exhibit the film “Himala ng Birhen” during the town fiesta on September 17 and 18. He made extensive preparations, including printing and distributing posters and advertising in a local weekly. On September 17, LVN Pictures delivered the film can to defendant-appellee Philippine Air Lines, Inc. (PAL) for shipment from Manila to the Pili Air Port near Naga. PAL issued Air Way Bill No. 317133. The film was loaded on Flight 113, which arrived at Pili Air Port in the afternoon of September 17. However, due to the fault of PAL’s employees or agents, the film was not unloaded and was brought back to Manila. Mendoza inquired at the air port, and the station master sent radiograms to Manila. The film was located on September 18 and shipped to Pili on September 20. Mendoza received it and exhibited the film but missed the fiesta crowd, resulting in a loss of expected profits. The trial court found that Mendoza suffered damages of P3,000 due to the failure to exhibit the film during the fiesta but dismissed the complaint, holding PAL not liable for these damages. PAL relied on paragraph 6 of the Way Bill, which stated the carrier was not obligated to carry the goods by any specified aircraft or on a specified time. The trial court held that once the film was loaded and shipped, PAL assumed the obligation to unload it at the destination, and its failure constituted negligence, but it was a debtor in good faith. The court applied Article 1107 of the Civil Code, holding that the damages were not foreseen or could not have been foreseen at the time of the contract because neither the shipper nor the consignee had informed PAL of the special circumstances.

ISSUE

Whether PAL is liable for the special damages (loss of profits) suffered by Mendoza due to the delay in delivering the film, considering the lack of notice to PAL of the special circumstances surrounding the shipment.

RULING

No. The decision of the trial court is affirmed. PAL is not liable for the special damages (loss of profits) claimed by Mendoza. The Court, without making a definite ruling on the civil or commercial nature of air transportation, inclined to regard it as commercial, analogous to land and water transportation, and PAL as a common carrier. However, whether governed by the Code of Commerce or the Civil Code, the principle is the same: a carrier is liable only for damages that were foreseen or could have been foreseen at the time of constituting the obligation. Here, neither LVN Pictures nor Mendoza informed PAL of the special need to deliver the film by September 17 for the fiesta. Therefore, the loss of profits was not within the contemplation of the parties at the time of the contract. The Court cited Article 1107 of the Civil Code and analogous principles under commercial law. The Court also noted that Mendoza, as consignee, had a right to enforce the contract of carriage, but his claim for damages was limited to those foreseeable. The Court suggested that exhibitors in similar situations should either obtain films well in advance or make special contracts with carriers, informing them of the circumstances and potential damages.