Hot Water Case: 10 yr old v. airline

The airline is in hot water.

A 10-year old girl reportedly suffered 2nd degree burns while on flight from Bangkok to Manila on board a domestic airline. When she was served with her requested “hot water”, she accidentally spilled the contents on herself resulting in the injuries on her left thigh and leg. In response, the airline crew allegedly insisted that she was served only with “warm water”. (Read: News Report.)

To make things more interesting (or worse for the airline), the little girl happens to be a granddaughter of a Cebu-based mall tycoon whose group owns, runs, and operates a family-owned chain of malls in the Visayas and Mindanao. A tort case from a wealthy family will cause serious problems.

A tort case is the worst nightmare for a business, especially for an airline which is a common carrier subject to the highest form of diligence required by law – extraordinary diligence.

A tort or quasi-delict is “the wrongful act or negligent act or omission which creates a vinculum juris and gives rise to an obligation between two persons not formally bound by any other obligation” (Sps. Batal v. Sps. San Pedro, G.R. No. 164601, 27 September 2006, citing A.M. Tolentino, Commentaries and Jurisprudence on the Civil Code of the Philippines, p. 592, 1992).

This is usually referred to as negligence cases (which is not accurate as it may also apply to wilful acts). Thus, “a person is liable for damages against another who suffers damage as a result of the former’s acts or omissions which are the proximate cause, whether the same is due to negligence or fault, and there is no pre-existing contractual relation between the two persons” (J. Del Puerto, Legal Aspects of Business, 2014).

In the present case, there appears to be a prima facie case for quasi-delict. Based on reports, the girl suffered 2nd degree burns the proximate cause of which is the “hot water” served to her by the airline’s stewardess. The issue now revolves on whether there was negligence.

In the U.S., there is that much celebrated incident referred to as the Hot Coffee Case which is similar herein. In the Hot Coffee Case, a 79-year old grandmother accidentally spilled hot coffee on her thighs resulting in 3rd degree burns. She won and was initially awarded $2.86 Million (later reduced to $640K by the court and subsequently settled for an undisclosed amount). During the trial, the Complainant established their negligence case by showing that the coffee was “unreasonable hot” (as it did cause 3rd degree burns) and there have been numerous previous complaints with no adequate response. On the other hand, the business puts forth the defense that the temperature was just enough for a hot coffee and tried to shift the liability to the Complainant. As stated, the Complainant won.

Going back to the 10-year old, the airline as a common carrier is in a more difficult position to defend itself. Any defense they put forth will be invalidated by the extraordinary diligence required of their business as discussed in a previous article “Domestic airline loses to psoriasis”.

In the article mentioned above, another domestic airline was held liable for over P2 Million after it refused to board a passenger who was suffering from psoriasis. While the Complainant was refused in the morning of her flight, she was nonetheless boarded in the afternoon of the same day. Regardless, the damage has been done and she filed a complaint. While the trial court appears to have not made any explicit reference to extraordinary diligence, it ruled against the Defendant airline company stating that it “owes to a passenger the highest degree of care and this includes defendant’s duty to provide its own medical staff or consultants who could easily be contacted.” It resonates of extraordinary diligence.

For good reasons, common carriers are held to the highest degree of diligence – extraordinary diligence – as their business involve the safety and security of their passengers. They transport lives so to speak.

Thus, the Supreme Court has held that, in a contract of carriage, “the carrier assumes the express obligation to transport its passenger to his destination safely and to observe extraordinary diligence with due regard to all the circumstances, and any injury that might be suffered by the passenger is right away attributable to the fault or negligence of the carrier and thus gives rise to the right of the passenger or his heirs for indemnity” (Candano Shipping Lines, Inc., v. Sugata-on, G.R. No. 163212, 13 March 2007).

If you want to know how high a degree is extraordinary diligence, there has been no case (to my knowledge thus far) raised to the Supreme Court against a common carrier where the latter was able to discharge such a burden. On various occasions, the common carrier has been made liable.

For this 10-year old girl, her life has been placed at risk. Against extraordinary diligence, the airline may find it a Herculean task to defend itself. Unfortunately, they started weak with a “warm water” defense. On the side, settlement is the better route for both parties as each side having the financial means will engage top caliber lawyers who will exhaust any and all means to protect the interest of their respective clients. This could easily result in an expensive and protracted lawsuit.

Best Legal Practices: How It Started

Business law can be complicated.

I have been writing about Best Legal Practices in Legal Aspects and in my various social media accounts. My book Legal Aspects of Business with Best Legal Practices are filled with these practices.

Many have asked me what these “Best Legal Practices” are all about. They are interested as it is their first time from hearing these aside from the usual industry best practices. When have you encountered best legal practices?

Continue reading here.


Employment Contracts and Employee Status

Employment contracts may have these arrangements: regular, probationary, casual, project, seasonal, and fixed-term. Each arrangement places an employee on a certain status. There are requirements for each employment contract. Failure to comply with the requisites results in the employee becoming regular, who will be entitled to all rights and privileges owing to such an employee.

Continue reading here.

Handling Grievance in the Workplace

Handling Grievance in the workplace is a good way to prevent an issue from escalating to a labor complaint. In some cases, a simple concern in the workplace when left unresolved becomes a big problem later when a labor case is brought against the employer. It is, thus, important that issues be resolved properly and adequately within an establishment.

Continue reading here.

Best Legal Practices: Disciplining or Terminating an Employee

Best Legal Practices are designed to protect businesses and organizations by preventing lawsuits and liabilities. These are best practices with legal compliance. For labor law, best legal practices are sourced from labor laws, rules and regulations, jurisprudence, and industry best practices.

Due Process Termination: Legal Way to Dismiss an Employee

Due process termination is the legal way to terminate an employee. Without due process, the employer will be liable for illegal dismissal, full backwages, reinstatement, separation pay if reinstatement is not feasible, moral and exemplary damages, nominal damages, and attorney’s fees. Illegal dismissal could result in a huge monetary award.

Intel Technology Philippines, Inc. v. NLRC, Jeremias Cabiles

Resignation is the formal relinquishment of an office, the overt act of which is coupled with an intent to renounce. This intent could be inferred from the acts of the employee before and after the alleged resignation.

G.R. No. 200575, 05 February 2014

Complainant Jeremias Cabiles filed a labor complaint primarily to recover retirement benefits from his employer Defendant Intel Technology Philippines, Inc. “Cabiles was initially hired by Intel Phil. on April 16, 1997 as an Inventory Analyst. He was subsequently promoted several times over the years and was also assigned at Intel Arizona and Intel Chengdu. He later applied for a position at Intel Semiconductor Limited Hong Kong (Intel HK).” He was offered by the latter the position of Finance Manager.

Prior to accepting the post, Complainant sent an email to Defendant which read:

“Are there any clearance requirements I need to fulfil as I move as a local hire to Hong Kong starting February 1?? I am still on my expat assignment in Chengdu till it ends January 31. Then immediately I become a HK local employee so I don’t technically repatriate and work back to my home site Philippines at all.

“Nevertheless, I still need to close I think my employment there and so that all my ES benefits and clearance will be closed like conversion of my vacation leaves to cash, carry over of my service tenure in CV to HK etc. Please do let me know what process I need to go through or would an email notification be enough?

“Another issue I would like to clarify is with regard to my retirement benefits. Will celebrate my 10th year of service with Intel on April 16, 2007. However, because I will be moving to Hong Kong as a local hire starting February 1, would I still be entitled to retirement benefits?? Do we round up the years of service if its close enough to 10 years?? If not, what other alternatives I have or do I just lose my years of service at Intel Philippines? Any possibility that I keep my 9.5 years and start it from there when I work in the Philippines again in the future?? [Emphases supplied]”

In response, Defendant stated that Complainant was not yet entitled to the retirement benefit as he has not yet rendered at least 10 years of service. Afterwards, Complainant received his final pay and executed a Release, Waiver, and Quitclaim (Waiver). After seven (7) months with Intel HK, Complainant resigned. Two years after that, he filed the present labor case alleging non-payment of retirement benefits and for moral and exemplary damages. He insists that he has been employed with by Intel for 10 years and 5 months, including his Intel HK stint.

HELD: Complainant was not entitled to his retirement benefits as he did not render 10 years of service. Complainant resigned prior to making it on his 10th year. “Resignation is the formal relinquishment of an office, the overt act of which is coupled with an intent to renounce. This intent could be inferred from the acts of the employee before and after the alleged resignation.”

Here, “[Complainant], while still on a temporary assignment in Intel Chengdu, was offered by Intel HK the job of a Finance Manager.”

In his letter, it showed two of Complainant’s main concerns: “a) clearance procedures; and b) the probability of getting his retirement pay despite the non-completion of the required 10 years of employment service. Beyond these concerns, however, was his acceptance of the fact that he would be ending his relationship with Intel Phil. as his employer. The words he used – local hire, close, clearance – denote nothing but his firm resolve to voluntarily disassociate himself from Intel Phil. and take on new responsibilities with Intel HK.”

Even if there was no favorable response to that letter, Complainant still accepted the Intel HK post. “His acceptance of the offer meant letting go of the retirement benefits he now claims as he was informed through email correspondence that his 9.5 years of service with Intel Phil. would not be rounded off in his favor. He, thus, placed himself in this position, as he chose to be employed in a company that would pay him more than what he could earn in Chengdu or in the Philippines.”

Complainant made a choice. “The choice of staying with Intel Phil. vis-à-vis a very attractive opportunity with Intel HK put him in a dilemma. If he would wait to complete ten (10) years of service with Intel Phil. (in about 4 months) he would enjoy the fruits of his retirement but at the same time it would mean forfeiture of Intel HK’s compensation offer in the amount of HK $ 942,500.00, an amount a lot bigger than what he would receive under the plan. He decided to forfeit and became Intel HK’s newest hire.”

As such, Complainant did resign. “All these are indicative of the clearest intent of Cabiles to sever ties with Intel Phil. He chose to forego his tenure with Intel Phil., with all its associated benefits, in favor of a more lucrative job for him and his family with Intel HK.”

Regarding his claim that he was merely assigned Intel HK or an extension of his employment with Intel Phil., there is no such secondment contract. “The continuity, existence or termination of an employer-employee relationship in a typical secondment contract or any employment contract for that matter is measured by the following yardsticks: … 1. the selection and engagement of the employee; … 2. the payment of wages; … 3. the power of dismissal; … and 4. the employer’s power to control the employee’s conduct.”

Applying the four-fold test, Intel HK became the new employer. “It provided Cabiles his compensation. Cabiles then became subject to Hong Kong labor laws, and necessarily, the rights appurtenant thereto, including the right of Intel HK to fire him on available grounds. Lastly, Intel HK had control and supervision over him as its new Finance Manager. Evidently, Intel Phil. no longer had any control over him.”

Complainant’s Waiver was valid. Citing jurisprudence, “[n]ot all waivers and quitclaims are invalid as against public policy. If the agreement was voluntarily entered into and represents a reasonable settlement, it is binding on the parties and may not later be disowned simply because of a change of mind. It is only where there is clear proof that the waiver was wangled from an unsuspecting or gullible person, or the terms of settlement are unconscionable on its face, that the law will step in to annul the questionable transaction. But where it is shown that the person making the waiver did so voluntarily, with full understanding of what he was doing, and the consideration for the quitclaim is credible and reasonable, the transaction must be recognized as a valid and binding undertaking.”