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Sharts v. Natelson6/30/1993
der to determine the quantity of harm or loss in fact that satisfies the first prong of the Jaramillo analysis, we note that useful guidance is found in the Discussions of "harm" and "injury" appearing in , and in the Restatement of Torts. While distinguishing the terms "harm" and "injury," the Lovelace Court cited Restatement (Second) of Torts § 7(1), at 12 (1965), for the general proposition that "harm" is a definite loss in fact and "injury" is an invasion of a legally protected interest.
Accordingly, in the present case, we believe Sharts' "injury" was the alleged negligent drafting of the restrictive covenants by Natelson. Moreover, we believe negligent document drafting by an attorney constitutes an invasion of a client's legally protected interest in professional competence. However, as in Jaramillo, the harm or loss in fact which flowed from the alleged negligent document drafting did not trigger the statute of limitations at that time. Jaramillo and its underlying authority teaches that an invasion of a legally protected interest (an injury ), without actual loss (harm), is insufficient to accrue a cause of action in legal malpractice for purposes of Section 37-1-4. See also W. Page Keeton, et al., Prosser & Keeton on the Law of Torts § 30, at 143-44 (5th ed. 1984) (negligence action developed out of old action on the case and rule of that action required harm in fact be proved); but see Budd v. Nixen, 491 P.2d at 436 (cause of action arises before client suffers all or even the greater part of the harm caused by attorney malpractice).
Under the facts of this case, we believe that until the time of the adverse declaratory judgment action, Sharts' rights were not diminished under the law, only challenged. In other words, the full benefit of the proposed real estate development still remained available and no legal action constrained its advancement. However, at the time of the adverse ruling in the declaratory judgment action, Sharts' legal entitlement to develop his land in the manner he had intended was severely diminished if not completely lost. See (trial court ruling reducing approval to build dwelling units from 287 units to 83 units is clear "occurrence resulting in loss" and marks the latest date upon which the cause of action could accrue under Tort Claims Act); ) (cause of action in professional negligence accrued at time legal liability materialized under contract); see also First Nat'l Bank of Clovis v. Diane. Inc..
C. Occurrence Resulting in Loss under the Tort Claims Act
In Aragon & McCoy, our Supreme Court considered the question of when an occurrence resulting in loss" is sufficient to accrue a cause of action under the Tort Claims Act, NMSA 1978, §§ 41-4-1 to -15(A) (Repl. Pamp. 1989). That Court said:
The plain language of the statute indicates that the period of limitations began to run when an "occurrence resulting in loss" took place. Until such a loss took place, the statute of limitations could not begin to run.
Like the trial court, we agree that the date of accrual could have begun on several dates when Aragon suffered loss or injury. In October 1976, the neighbors filed suit which eventually resulted in the invalidation of Aragon's site development plan. On February 3, 1977, Aragon's application for a Phase II building permit was denied. Aragon submits that injury or loss occurred when the Supreme Court ruled on March 31, 1978. In our opinion, the very last event which might be characterized as a loss or injury was the district court's February 8, 1977 order which vacated the 1972 decision approving the construction of 287 dwelling units. As a result of this o
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