G.R. No. L-9185; January 25, 1915
GERALDINE COLEMAN, plaintiff-appellee, vs. HOTEL DE FRANCE COMPANY, defendant-appellant.

FACTS:
On September 13, 1912, in Sydney, Australia, Geraldine Coleman, a professional gymnast, entered into a written contract with the Hotel de France Company through its manager, Ignacio Arnalot. The defendant hired the plaintiff to entertain patrons at its hotel in Manila for three months. The contract stipulated a monthly salary of £12, plus board, lodging, laundry, and payment for her passage from Australia to Manila and back. The plaintiff was ready and able to fulfill her obligations. However, the defendant company canceled the contract. The plaintiff sued for damages arising from the breach. The trial court ruled in favor of Coleman, awarding her P585.42. The defendant appealed, raising several defenses.

ISSUE:
1. Whether the contract is void under the immigration laws.
2. Whether the contract is ultra vires (beyond the corporate powers of the defendant).
3. Whether the defendant was justified in canceling the contract due to an alleged violation by the plaintiff.
4. Whether the trial court applied the correct measure of damages.

RULING:
The Supreme Court affirmed the trial court’s judgment.

1. On the Immigration Law Defense: The contract is not void. The U.S. Immigration Act of February 20, 1907, which was in force in the Philippines, expressly exempts “professional actors, artists, [etc.]” from the provisions excluding contract labor. The Court found that Coleman, as a professional acrobat and trapeze artist engaged for professional exhibitions, clearly fell within this exception.

2. On the Ultra Vires Defense: The contract was not beyond the corporation’s powers. The defendant corporation was engaged in operating hotels and weekend resorts. The Court held that hiring vaudeville artists, including acrobats, to entertain guests and attract patronage is fairly incidental and within the implied powers of such a business. The doctrine of ultra vires cannot be invoked to defeat justice where a corporation has enjoyed the benefits of a contract.

3. On the Justification for Cancellation: The Supreme Court adopted the trial court’s findings, which sufficiently disposed of the defendant’s claim that the plaintiff’s misconduct justified the cancellation. The Court found no basis for this defense.

4. On the Measure of Damages: The trial court correctly applied the measure of damages. A plaintiff wrongfully discharged is entitled to recover the full amount stipulated for the entire contract period, less any compensation she actually earned or could have earned through reasonable effort in other employment during the unexpired term. The burden of proving such mitigating earnings rests upon the defendant.

The judgment of the trial court was affirmed, with costs against the appellant.