Rideau

I.

INTRODUCTION

Earl B. Rideau and Marina Rideau (the Rideaus) entered into an agreement with a

developer, BGJB de Mexico, S. de R.L. de C.V. (BGJB), to purchase a condominium in a

building to be constructed in Mexico. The Rideaus deposited $239,700 toward the

purchase price with an escrow company, defendant Stewart Title of California (Stewart

Title). The escrow instructions provide in relevant part:

"ESCROW HOLDER is authorized and instructed to release funds as instructed by SELLER . . . without further authorization from BUYERS; said funds to be disbursed by California Fund Control to pay direct costs, commissions and construction costs only. California Fund Control and SELLER have in place, an agreement where California Fund Control inspects the project site and authorizes payment of construction costs to contractor, sub- contractors and suppliers according to a pre-approved voucher control system."

Stewart Title released the Rideaus' deposit, together with the deposits of other

purchasers, to entities other than California Fund Control, including to BGJB. BGJB

failed to construct the condominium building, and neither Stewart Title nor BGJB

returned the…