Appeal from the District Court of the United States for the District of New Jersey; Guy L. Fake, Judge.
Before BUFFINGTON, THOMPSON, and BIGGS, Circuit Judges.
Upon April 10, 1935, Madison Square Garden Corporation (hereafter referred to as the Garden) entered into a contract with James J. Braddock which provided for a contest with Max Baer, then holder of the title of heavyweight champion of the world, and further provided in paragraph 10 of the contract as follows:
"That in the event Braddock is the winner of the boxing contest between him and the said Max Baer and Braddock shall become the heavyweight champion of the world, then the Garden shall employ Braddock and Braddock agrees that he will render services as a boxer in his first boxing contest thereafter (which contest shall be for the heavyweight championship of the world). Such contest shall be held in the United States of America under the auspices of the Garden, not later than September 30, 1936, with an opponent to be mutually agreed upon. * * *"
Paragraph 11 of the contract provided:
"That Braddock shall not, prior to the contest referred to in paragraph 10 hereof, engage in any boxing contest or boxing exhibition, without the written consent of the Garden, except boxing exhibitions for not more than four (4) rounds and in which no decision is rendered. Such exhibition contests may be held under the auspices of others than the Garden."
Upon July 28, 1936, within the time provided by the contract of April 10, 1935, the Garden notified Braddock that he was to fight Max Schmeling at Madison Square Garden Bowl, in the city of New York, upon the evening of September 30, 1936, and upon the following day Braddock's manager advised the Garden that the selection of Braddock's opponent, the date and place of meeting, were acceptable to Braddock. Thereafter, on August 12, 1936, it became apparent that Braddock had suffered a severe injury to his left hand which would render it impossible for him to engage in the fight with Schmeling upon September 30, 1936.
On August 21, 1936, Braddock and the Garden entered into a contract (Exhibit "C" of the record) wherein and whereby he contracted to fight Schmeling under the auspices of the Garden, the match to be held on either the 3d or the 10th day of June, 1937. This contract, to which Braddock was the party of the second part, provided, eiter alia, as follows:
"The party of the second part hereby agrees to deposit with the party of the first part, cash, certified check, or accepted draft for the sum of 10,000 as forfeit money, to a guarantee his appearance, his making the weight as above agreed, and for his performance of this contract in all other respects.
"If said party of the second part shall fail to appear or make the weight agreed upon, or if said party is not in physical condition and should fail to pass the required examination by a duly licensed Physician, then said forfeit money may, at the discretion of the Athletic Commission, be forfeited to the party of the first part (the Garden), and undert these circumstances the party of the first part will pay to Max Schmeling, the other contestant in this match, or his duly authorized manager, the sum of $5,000. as liquidated damages. If for any reason, other than the failure on the part of either of the two contestatnts to appear, the party of the first part does not fulfill this contract, the party of the first part shall then pay to the party of the second part an amount equal to said forfeit as liquidated damages, unless this match is cancelled by mutual consent."
A further paragraph of this contract provided:
"It is further agreed that if said party of the second part enters into another contest prior to the one herein contracted for and is defeated or in any other way does anything calculated to lessen his present value as an attraction, the party of the first part shall have the option to rescind and cancel this contract without further liability hereunder, provided such cancellation is approved by the New York State Athletic Commission."
Upon December 12, 1936, a further contract (Exhibit "E" of the record) was entered into between Braddock and the Garden in which the date of the proposed contest with Schmeling was definitely fixed for June 3, 1937, Braddock's percentages of payment in the terms of "the gross receipts of the house" were more than doubled, but the other provisions of the contract were substantially the same as those contained in the contract ...