Defendant buyer appealed an order from the Superior Court of Los Angeles County (California), which found in favor of plaintiff seller in plaintiff’s suit seeking the recovery of money held in escrow on the allegation that defendant breached a contract for the purchase of real property.
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Overview
Plaintiff seller filed suit against a bank to recover money held in escrow under an agreement with defendant buyer for the purchase of real property, alleging that upon defendant’s breach of their agreement, plaintiff became entitled to the money. The bank interpleaded defendant, paid the money to the lower court, and was discharged from the suit. The lower court entered judgment in favor of plaintiff and defendant appealed, claiming that there was no memorandum sufficient to charge defendant under the statute of frauds as signed by defendant because defendant only signed his escrow instructions and not plaintiff’s. The court affirmed the lower court’s judgment. The court held that defendant was bound by a valid contract because in construing separately executed escrow instructions as one contract, the court found a complete agreement of sale and purchase, containing all of the necessary terms, covenants, and conditions. The court found that the mutual stipulations of the parties, the actual conveyance in escrow by one and the promise by the other to pay the price both being valid, constituted a sufficient consideration and created a valid escrow.
Outcome
A judgment for plaintiff seller to recover defendant buyer’s money in escrow due to a breach of contract was affirmed on the grounds that separately executed escrow instructions contained sufficient terms and stipulations so as to be deemed a valid escrow agreement.