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Sharts v. Natelson6/30/1993
able by Sharts prior to July 10, 1985. Sharts predicates his cause of action on the contention that he requested Natelson to draft restrictive covenants only for Tract One of the sixty-acre property. Natelson's failure to handle properly the alleged assignment was clearly ascertainable by Sharts well before July 10, 1985. In 1981 Sharts had received a letter from an attorney contending that the covenants affected all 60 acres of Tracts One and Two. Other attorneys challenged Sharts' development of Tract Two in a 1983 letter. Also in 1983, a title company had informed Sharts that the restrictions applied to all 60 acres. In 1984 Sharts had even brought a declaratory judgment to attempt to remove the cloud from his title to Tract TWO. Any reasonable person could infer from these events that Natelson had not handled the covenants in a manner to avoid nonfrivolous claims that Tract TWO was restricted by the covenants. See Levine v. Diamanthuset, Inc., 722 F. Supp. 579, 590 (N.D. Cal. 1989) (cause of action arose when plaintiffs had notice of their investment problems and the consequent legal issues because attorney general had filed suit). On April 3, 1985, Sharts wrote Natelson the following letter:
This letter is to inform you that if you can get a DECLARATORY JUDGEMENT in my favor, I'm only going to sue you for approximately $35,000 which represents the extent of the damages I've suffered so far, in the form of interest payments I've had to pay while waiting for you to correct the legal errors you should have corrected two years ago when you were made aware of them.
If you lose, the Declaratory Judgement to set the record straight, I intend to bring a MALPRACTICE SUIT against Natelson and Ross for a minimum of $800,000 to $2,000,000 which represents the direct and provable damages you have caused me by your carelessness.
I am bringing to New Mexico some very expensive and very professional "family" attornies who are interested in the case.
The letter noted that copies were being sent to ten persons, including one titled "Esq." Thus, it is not surprising that Sharts' answer brief acknowledges that by April 3, 1985, he "was aware that Natelson may have been careless in drafting and recording the original restrictive covenants." Sharts does not claim that he was unaware of any pertinent facts.
As for damages, by July 9, 1985, Sharts knew that there was a cloud on his title and that the cloud at the least had delayed development of his property and had required him to incur attorney's fees for the declaratory judgment action and related activity. Sharts' letter to Natelson of April 3, 1985, demonstrated knowledge of serious consequences to Sharts' arising from the problems with the covenants. He knew that he had suffered actual damages. The discovery rule is not designed to protect persons as aware of the essential facts as Sharts was. See Grunwald, 621 A.2d at 463.
B. Was Discoverability Delayed--
In his Answer Brief Sharts advances two reasons why his cause of action was not discoverable before July 10, 1985.
1. Until Conclusion of the Declaratory Judgment Action?
First, he argues that his damages were not ascertainable until the Conclusion of the declaratory judgment action. But, as already pointed out, even eventual victory in the declaratory judgment action would not eliminate the damages suffered by Sharts as a result of the problems with the covenants. See Laird v. Blacker, 828 P.2d at 696. Sharts would still have incurred attorney's fees in trying to clear the cloud to his title, as well as losses from delay in the project. A cause of action accrues even when the full extent of damages is un
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