Praszker

We consider an appeal by defendants Roman Praszker and West and Praszker Realtors, Inc. (collectively Praszker), and a cross-appeal by plaintiff Norman I. Krug Real Estate Investments, Inc., arising from a judgment of the superior court in favor of Krug and against Praszker in the sum of $27,144.73. The judgment was rendered after the court found that Praszker, who listed property on which Krug held an unrecorded deed of trust, was negligent in failing to disclose the existence of Krug’s security interest to a prospective buyer or to inform Krug beforehand of the impending sale.

Background

Krug is a California corporation operated by Norman I. Krug (hereafter both are referred to as Krug), engaged in the business of making real estate investments. In 1978 Krug and Dr. Robert A. Gilbert acquired a multiunit apartment building at 445 Webster Street, San Francisco (445 Webster). The parties agreed that they would operate the property as an equal partnership, with Dr. Gilbert assuming responsibility for managing the property.

Subsequently, Gilbert spent approximately $90,000 of his own funds on the property and requested reimbursement from Krug for half of the amount. Krug…