10. Breach of Contract and Damages

On 8 December 1991 Vanessa purchased from the Manila office of Euro-Aire an airline ticket for its Flight No. 710 from Dallas to Chicago on 16 January 1992. Her flight reservation was confirmed. On her scheduled departure Vanessa checked in on time at the Dallas airport. However, at the check-in counter she discovered that she was waitlisted with some other passengers because of intentional overbook­ing, a Euro-Aire policy and practice, Euro-Aire admitted that Vanessa was not advised of such policy when she purchased her plane ticket, Vanessa was only able to fly two days later by taking another airline.

Vanessa sued Euro-Aire in Manila for breach of contract and damages. Euro-Aire claimed that H cannot be held liable for damages because its practice of overbooking passengers was allowed by the U.S. Code of Federal Regulations. Vanessa on the other hand contended that assuming that the U.S. Code of Federal Regulations allowed intentional overbook­ing, the airline company cannot invoke the U.S. Code on the ground that the ticket was purchased in Manila, hence. Philippine law should apply, under which Vanessa can recover damages for breach of contract of carriage.

Decide. Discuss funny.

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