Kahn

Defendant, a realtor and mortgage broker, appeals from a judgment awarding his clients damages in the amount of $2,905 arising out of a fraudulent misappropriation committed by a salesman employed by appellant while that salesman was acting within the scope of ostensible authority. Appellant asserts that the evidence and findings of fact do not support the judgment; we hold to the contrary.

The Pacts

In the fall of 1958 respondents, desiring to make investments, were referred by a mutual acquaintance to Mr. Anderson, a salesman employed in appellant’s real estate office, Gordon Realty Company. At that office respondents met Anderson who introduced them to appellant. Appellant explained that deeds of trust were good investments. Respondents, who were husband and wife and both dance choreographers, had little knowledge of investments in general or deeds of trust in particular; their ignorance was readily apparent to appellant, but he assured them “that Mr. Anderson could take full responsibility and care of [their] account, whatever further dealings [they] had with the office. ’ ’

Shortly thereafter Anderson contacted respondents with a specific investment opportunity and at the…