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Schauer v. Mandarin Gems of California, Inc.

Court of Appeal of California
23 Cal. Rptr. 3d 233 (2005)


Sarah Jane Schauer (plaintiff) and her fiancé, Darin Erstad, went shopping together for an engagement ring. Erstad and Schauer chose a diamond ring at Mandarin Gems of California, Inc. (defendant) (Mandarin) and were told that the ring had a certain carat and clarity grading. According to Schauer, Erstad bought the ring for the stated purpose of giving the ring to her. Schauer and Erstad later divorced. The divorce judgment awarded each party title and possession of all personal property in that party’s present possession. Schauer’s personal property included the engagement ring. Schauer had the ring evaluated and was told that the ring was of a lesser quality than what Mandarin had stated and was worth significantly less than what Erstad had paid. Schauer sued Mandarin for breach of contract, rescission, recovery under the California Consumers Legal Remedies Act (the Act), and actual and constructive fraud. The trial court sustained Mandarin’s demurrer, which asserted that Schauer had no viable claim because Schauer was neither the purchaser of the ring nor a third-party beneficiary of the contract between Erstad and Mandarin. The trial court dismissed Schauer’s claims. Schauer appealed.

Rule of Law


Holding and Reasoning (Ikola, J.)

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