SOLOMON BOYSAW AND ALFREDO M. YULO, JR., PLAINTIFFS-APPELLANTS, VS. INTERPHIL PROMOTIONS, INC., LOPE SARREAL, SR., AND MANUEL NIETO, JR., DEFENDANTS-APPELLEES.

This is an appeal interposed by Solomon Boysaw and Alfredo Yulo, Jr., from
the decision dated July 25, 1963 and other rulings and orders of the then Court
of First Instance [CFI] of Rizal, Quezon City, Branch V in Civil Case No. Q-5063, entitled
“Solomon Boysaw and Alfredo M. Yulo, Jr., Plaintiffs versus Interphil
Promotions, Inc., Lope Sarreal, Sr.
and Manuel Nieto, Jr., Defendants“, which, among others, ordered
them to jointly and severally pay defendant-appellee
Manuel Nieto, Jr., the total sum of
P25,000.00, broken down into P20,000.00 as moral damages and P5,000.00 as
attorney’s fees; the defendants-appellees Interphil Promotions, Inc. and Lope Sarreal, Sr., P250,000.00 as unrealized profits, P33,369.72
as actual damages and P5,000.00 as attorney’s fees; and defendant-appellee Lope Sarreal, Sr., the
additional amount of P20,000.00 as moral damages aside from
costs.

The antecedent facts of the case are as follows:

On May 1, 1961, Solomon Boysaw and his
then Manager, Willie Ketchum, signed with Interphil
Promotions, Inc. represented by Lope Sarreal, Sr., a
contract to engage Gabriel “Flash” Elorde in a boxing
contest for the junior lightweight championship of the world.

It was stipulated that the bout would be held at the Rizal Memorial Stadium in Manila on September 30, 1961 or
not later than thirty [30] days thereafter should a postponement be mutually
agreed upon, and that Boysaw would not, prior to the
date of the boxing contest, engage in any other such contest without the written
consent of Interphil Promotions, Inc.

On May 3, 1961, a supplemental agreement on certain details not
covered by the principal contract was entered into by Ketchum and Interphil.  Thereafter, Interphil signed Gabriel “Flash” Elorde to a similar agreement, that is, to engage Boysaw in a title fight at the Rizal Memorial Stadium on September 30, 1961.

On June 19, 1961, Boysaw fought and
defeated Louis Avila in a ten-round non-title bout held in Las Vegas, Nevada,
U.S.A. [pp. 26-27, t.s.n., session of March 14,
1963].

On July 2, 1961, Ketchum, on his own behalf and on behalf of his
associate Frank Ruskay, assigned to J. Amado Araneta the managerial
rights over Solomon Boysaw.

Presumably in preparation for his engagement with
Interphil, Solomon Boysaw
arrived in the Philippines on July 31, 1961.

On September 1, 1961, J. Amado Araneta assigned to Alfredo J. Yulo, Jr. the managerial rights over Boysaw that he earlier acquired from Ketchum and Ruskay.  The next day, September 2, 1961, Boysaw wrote Lope Sarreal, Sr.
informing him of his arrival and presence in the Philippines.

On September 5, 1961, Alfredo Yulo, Jr.
wrote to Sarreal, informing him of his acquisition of
the managerial rights over Boysaw and indicating his
and Boysaw’s readiness to comply with the boxing
contract of May 1, 1961.  On the same date, on behalf of Interphil, Sarreal wrote a letter
to the Games and Amusement Board [GAB] expressing concern over reports that
there had been a switch of managers in the case of Boysaw, of which he had not been formally notified, and
requesting that Boysaw be called to an inquiry to
clarify the situation.

The GAB called a series of conferences of the parties concerned
culminating in the issuance of its decision to schedule the Elorde-Boysaw fight for November 4, 1961.  The
USA National Boxing Association which has supervisory control of all world title
fights approved the date set by the GAB.

Yulo, Jr. refused to accept the change
in the fight date, maintaining his refusal even after Sarreal on September 26, 1961, offered to advance the fight
date to October 28, 1961 which was within the 30-day period of allowable
postponements provided in the principal boxing contract of May 1, 1961.

Early in October 1961, Yulo, Jr.
exchanged communications with one Mamerto Besa, a local boxing promoter, for a possible promotion of
the projected Elorde-Boysaw title bout. 
In one of such communications dated October 6, 1961, Yulo informed Besa that he was
willing to approve the fight date of November 4, 1961 provided the same was
promoted by Besa.

While an Elorde-Boysaw fight was
eventually staged, the fight contemplated in the May 1, 1961 boxing contract
never materialized.

As a result of the foregoing occurrences, on October 12, 1961,
Boysaw and Yulo, Jr. sued
Interphil, Sarreal, Sr. and
Manuel Nieto, Jr. in the CFI of Rizal [Quezon City Branch] for damages allegedly occasioned by the
refusal of Interphil and Sarreal, aided and abetted by Nieto, Jr., then GAB Chairman,
to honor their commitments under the boxing contract of May 1, 1961.

On the first scheduled date of trial, plaintiff moved to
disqualify Solicitor Jorge Coquia of the Solicitor
General’s Office and Atty. Romeo Edu of the GAB Legal
Department from appearing for defendant Nieto, Jr. on the ground that the latter
had been sued in his personal capacity and, therefore, was not entitled to be
represented by government counsel.  The motion was denied insofar
as Solicitor Coquia was concerned, but was granted as
regards the disqualification of Atty. Edu.

The case dragged into 1963 when sometime in the early part of said
year, plaintiff Boysaw left the country without
informing the court and, as alleged, his counsel.  He was still
abroad when, on May 13, 1963, he was scheduled to take the witness stand. 
Thus, the lower court reset the trial for June 20, 1963. 
Since Boysaw was still abroad on the later
date, another postponement was granted by the lower court for July 23, 1963 upon
assurance of Boysaw’s counsel that should Boysaw fail to appear on said date, plaintiff’s case would
be deemed submitted on the evidence thus far presented.

On or about July 16, 1963, plaintiffs represented by a new
counsel, filed an urgent motion for postponement of the July 23, 1963 trial,
pleading anew Boysaw’s inability to return to the
country on time.  The motion was denied; so was the motion for
reconsideration filed by plaintiffs on July 22, 1963.

The trial proceeded as scheduled on July 23, 1963 with plaintiff’s
case being deemed submitted after the plaintiffs declined to submit documentary
evidence when they had no other witnesses to present.  When
defendant’s counsel was about to present their case, plaintiffs’
counsel after asking the court’s permission, took no further part in the
proceedings.

After the lower court rendered its judgment dismissing the
plaintiffs’ complaint, the plaintiffs moved for a new trial.  The
motion was denied, hence, this appeal taken directly to this Court by reason of
the amount involved.

From the errors assigned by the plaintiffs, as having been
committed by the lower court, the following principal issues can be
deduced:

1. Whether or not there was a violation of the fight contract of May 1, 1961;
   and if there was, who was guilty of such violation.

2. Whether or not there was
   legal ground for the postponement of the fight date from September 1, 1961, as
   stipulated in the May 1, 1961 boxing contract, to November 4, 1961.

3. Whether or not the lower court erred in refusing a postponement of the July
   23, 1963 trial.

4. Whether or not the lower court erred in denying the appellant’s motion for a
   new trial.

5. Whether or not the lower court, on the basis
   of the evidence adduced, erred in awarding the appellees damages of the character and amount stated
   in the decision.

On the issue pertaining to the violation of the May 1, 1961
fight contract, the evidence established that the contract was violated by
appellant Boysaw himself when, without the approval or
consent of Interphil, he fought Louis Avila on June
19, 1961 in Las Vegas, Nevada.  Appellant Yulo admitted this fact during the trial.  [pp.
26-27, t.s.n., March 14, 1963].

While the contract imposed no penalty for such violation,
this does not grant any of the parties the unbridled liberty to breach it with
impunity.  Our law on contracts recognizes the principle that
actionable injury inheres in every contractual breach. 
Thus:

“Those who in the performance of their obligations are guilty of
fraud, negligence or delay, and those who in any manner contravene the terms
thereof, are liable for damages.” [Art. 1170, Civil Code].

Also:

“The power to rescind obligations is implied, in reciprocal ones, in
case one of the obligors should not comply with what is incumbent upon him.”
[Par. 1, Art. 1191, Civil Code].

There is no doubt that the contract in question gave rise to
reciprocal obligations.  “Reciprocal obligations are those which
arise from the same cause, and in which each party is a debtor and a creditor of
the other, such that the obligation of one is dependent upon the obligation of
the other.  They are to be performed simultaneously, so that the
performance of one is conditioned upon the simultaneous fulfillment of the
other” [Tolentino, Civil Code of the
Philippines, Vol. IV, p. 175.]

The power to rescind is given to the injured party. 
“Where the plaintiff is the party who did not perform the
undertaking which he was bound by the terms of the agreement to perform, he is
not entitled to insist upon the performance of the contract by the defendant, or
recover damages by reason of his own breach.” [Seva vs. Alfredo Berwin, 48 Phil.
581, underscoring supplied].

Another violation of the contract in question was the
assignment and transfer, first to J. Amado Araneta, and subsequently, to appellant Yulo, Jr., of the managerial rights over Boysaw without the knowledge or consent of Interphil.

The assignments, from Ketchum to Araneta, and from Araneta to Yulo, were in fact novations of
the original contract which, to be valid, should have been consented to by Interphil.

Novation which consists
in substituting a new debtor in the place of the original one, may
be made even without the knowledge or against the will of the latter,
but not without the consent of the creditor.” [Art. 1293, Civil Code,
underscoring supplied].

That appellant Yulo, Jr., through
a letter, advised Interphil on September 5, 1961 of
his acquisition of the managerial rights over Boysaw
cannot change the fact that such acquisition, and the prior acquisition of such
rights by Araneta were done without the consent
of Interphil. 
There is no showing that Interphil, upon
receipt of Yulo’s letter, acceded to the
“substitution” by Yulo of the original principal
obligor, who is Ketchum.  The logical presumption can only be that,
with Interphil’s letter to the GAB expressing concern
over reported managerial changes and requesting for clarification on the matter,
the appellees were not reliably informed of the
changes of managers.  Not being reliably informed, appellees cannot be deemed to have consented to such
changes.

Under the law when a contract is unlawfully novated by an applicable and unilateral substitution of the
obligor by another, the aggrieved creditor is not bound to deal with the
substitute.

“The consent of the creditor to the change of debtors, whether
in expromision or delegacion is an indispensable requirement . .
.  Substitution of one debtor for another may delay or prevent the
fulfillment of the obligation by reason of the inability or insolvency of
the new debtor, hence, the creditor should agree to accept
the substitution in order that it may be binding on
him.

Thus, in a contract where x is the creditor and y is the debtor, if
y enters into a contract with z, under which he transfers to z all his rights
under the first contract, together with the obligations thereunder, but such transfer is not consented to or
approved by x, there is no novation.  X can still bring his action against
y for performance of their contract or damages in case of breach.” [Tolentino, Civil Code of the Philippines, Vol. IV, p.
361].

From the evidence, it is clear that the appellees, instead of availing themselves of the options
given to them by law of rescission or refusal to recognize the substitute
obligor Yulo, really wanted to postpone the fight date
owing to an injury that Elorde sustained in a recent
bout.  That the appellees had the
justification to renegotiate the original contract, particularly the fight date
is undeniable from the facts aforestated. 
Under the circumstances, the appellees‘ desire
to postpone the fight date could neither be unlawful nor
unreasonable.

We uphold the appellees‘ contention that
since all the rights on the matter rested with the appellees, and appellants’ claims, if any, to the
enforcement of the contract hung entirely upon the former’s pleasure and sufferance, the GAB did not act
arbitrarily in acceding to the appellee’s request to
reset the fight date to November 4, 1961.  It must
be noted that appellant Yulo had earlier agreed
to abide by the GAB ruling.

In a show of accommodation, the appellees offered to advance the November 4, 1961 fight to
October 28, 1961 just to place it within the 30-day limit of allowable
postponements stipulated in the original boxing contract.

The refusal of appellants to accept a postponement without any
other reason but the implementation of the terms of the original boxing contract
entirely overlooks the fact that by virtue of the violations they have committed
of the terms thereof, they have forfeited any right to its
enforcement.

On the validity of the fight postponement, the violations of
the terms of the original contract by appellants vested the appellees with the right to rescind and repudiate such
contract altogether.  That they sought to seek an adjustment of one
particular covenant of the contract, is under the circumstances, within the
appellee’s rights.

While the appellants concede to the GAB’s authority to regulate boxing contests, including the
setting of dates therefor, [pp. 44-49, t.s.n., Jan. 17, 1963], it is their contention that only
Manuel Nieto, Jr. made the decision for postponement, thereby arrogating to
himself the prerogatives of the whole GAB Board.

The records do not support appellants’ contention. 
Appellant Yulo himself admitted that it
was the GAB Board that set the questioned fight date.  [pp.
32-42, t.s.n., Jan. 17, 1963].  Also, it
must be stated that one of the strongest presumptions of law is that official
duty has been regularly performed.  In this case, the absence of
evidence to the contrary, warrants the full application of said presumption that
the decision to set the Elorde-Boysaw fight on
November 4, 1961 was a GAB Board decision and not of Manuel Nieto, Jr.
alone.

Anent the lower court’s refusal to postpone the July 23,
1963 trial, suffice it to say that the same issue had been raised before Us by
appellants in a petition for certiorari and prohibition docketed
as G.R. No. L-21506.  The dismissal by the Court of said petition
had laid this issue to rest, and appellants cannot now hope to resurrect the
said issue in this appeal.

On the denial of appellant’s motion for a new trial, we find
that the lower court did not commit any reversible
error.

The alleged newly discovered evidence, upon which the
motion for new trial was made to rest, consists merely of clearances which Boysaw secured from the clerk of court prior to his
departure for abroad.  Such evidence cannot alter the result of the
case even if admitted for they can only prove that Boysaw did not leave the country without notice to the court
or his counsel.

The argument of appellants is that if the clearances were admitted
to support the motion for a new trial, the lower court would have allowed the
postponement of the trial, it being convinced that Boysaw did not leave without notice to the court or
to his counsel.  Boysaw’s
testimony upon his return would, then, have altered the results of the case.

We find the argument without merit because it confuses the
evidence of the clearances and the testimony of Boysaw.  We uphold the lower court’s ruling
that:

“The said documents [clearances] are not evidence to offset the
evidence adduced during the hearing of the defendants.  In fact,
the clearances are not even material to the issues raised.  It is
the opinion of the Court that the ‘newly discovered evidence’ contemplated in
Rule 37 of the Rules of Court, is such kind of evidence which has
reference to the merits of the case, of such a nature and kind, that if it were
presented, it would alter the result of the judgment.  As admitted
by the counsel in their pleadings, such clearances might have impelled the Court
to grant the postponement prayed for by them had they been
presented on time.  The question of the denial of the postponement
sought for by counsel for plaintiffs is a moot issue …  The
denial of the petition for certiorari and prohibition filed by them, had
the effect of sustaining such ruling of the court…  [pp. 296-297,
Record on Appeal].

The testimony of Boysaw cannot be
considered newly-discovered evidence for as appellees
rightly contend, such evidence has been in existence waiting only to be elicited
from him by questioning.

We cite with approval appellee’s
contention that “the two qualities that ought to concur or dwell on each and
every piece of evidence that is invoked as a ground for new trial in order to
warrant the reopening …  inhered separately on two unrelated
species of proof” which “creates a legal monstrosity that deserves no
recognition.”

On the issue pertaining to the award of excessive damages, it must
be noted that because the appellants wilfully refused
to participate in the final hearing and refused to present documentary evidence
after they no longer had witnesses to present, they, by their own acts prevented
themselves from objecting to or presenting proof contrary to those adduced for
the appellees.

On the actual damages awarded to appellees, the appellants contend that a conclusion or
finding based upon the uncorroborated testimony of a lone witness cannot be
sufficient.  We hold that in civil cases, there is no rule
requiring more than one witness or declaring that the testimony of a single
witness will not suffice to establish facts, especially where such testimony has
not been contradicted or rebutted.  Thus, we find no reason to
disturb the award of P250,000.00 as and for unrealized profits to the appellees.

On the award of actual damages to Interphil and Sarreal, the records
bear sufficient evidence presented by appellees of
actual damages which were neither objected to nor rebutted by appellants, again
because they adamantly refused to participate in the court proceedings.

The award of attorney’s fees in the amount of P5,000.00 in favor
of defendant-appellee Manuel Nieto, Jr. and another
P5,000.00 in favor of defendants-appellees Interphil Promotions, Inc. and Lope Sarreal, Sr., jointly, cannot also be regarded as excessive
considering the extent and nature of defense counsels’ services which involved
legal work for sixteen [16] months.

However, in the matter of moral damages, we are inclined to uphold
the appellant’s contention that the award is not sanctioned by law and
well-settled authorities.  Art. 2219 of the Civil Code
provides:

“Art. 2219.  Moral damages may be recovered in the
following analogous cases:

1) A
criminal offense resulting in physical injuries;

2)
Quasi-delict causing physical injuries;

3)
Seduction, abduction, rape or other lascivious acts;

4)
Adultery or concubinage;

5)
Illegal or arbitrary detention or
arrest;

6) Illegal
search;

7) Libel,
slander or any other form of defamation;

8)
Malicious prosecution;

9) Acts
mentioned in Art. 309.

10) Acts
and actions referred to in Arts., 21, 26, 27, 28, 29, 30, 32, 34 and
35.

The award of moral damages in the instant case is not based on any
of the cases enumerated in Art. 2219 of the Civil Code.  The action
herein brought by plaintiffs-appellants is based on a perceived breach committed
by the defendants-appellees of the contract of May 1,
1961, and cannot, as such, be arbitrarily considered as a case of malicious
prosecution.

Moral damages cannot be imposed on a party litigant although such
litigant exercises it erroneously because if the action has been erroneously
filed, such litigant may be penalized for costs.

“The grant of moral damages is not subject to the whims and caprices
of judges or courts.  The court’s discretion in granting or
refusing it is governed by reason and justice.  In order that a
person may be made liable to the payment of moral damages, the law requires that
his act be wrongful.  The adverse result of an action does not
per se make the act wrongful and subject the actor to the
payment of moral damages.  The law could not have meant to impose a
penalty on the right to litigate; such right is so precious that
moral damages may not be charged on those who may exercise it
erroneously.  For these the law taxes costs.  [Barreto vs. Arevalo, et. al. No. L-7748,
Aug. 27, 1956, 52 O.G., No. 13, p. 5818.]

WHEREFORE, except for the award of moral damages which is
herein deleted, the decision of the lower court is hereby affirmed.

SO
ORDERED.

Gutierrez, Jr., Paras, Padilla, Bidin, and Cortes, JJ., concur.