Opinion ID: 1441566
Heading Depth: 4
Heading Rank: 1

Heading: The Moores were damaged by Breck's negligence and made proper efforts to mitigate their damages

Text: Breck argues that the no dwelling plat restriction is invalid as a matter of law and therefore the Moores have suffered no damage because of it. [7] In Belland v. O.K. Lumber Co., 797 P.2d 638 (Alaska 1990), we held that a lender suffered no damage when the lender's attorney failed to discover a prior federal tax lien on the mortgaged property. Because a purchase money mortgage takes precedence over all prior liens, the lender was not harmed by the attorney's negligence. Id. at 641-42. The value of the loan was not diminished at all by the presence of the tax lien. In the present case, it is arguable that the no dwelling restriction is not enforceable against the Moores. [8] However, the restriction is not facially void. Thus, the cloud on the Moores' title is sufficient damage to maintain the action. The trial court correctly concluded that the Moores had alleged sufficient damage to state a cause of action for malpractice. In a related argument, Breck claims that the Moores failed to mitigate their damages by declining to pay him an additional fee to quiet title on the property. After the no dwelling restriction was discovered, Breck wrote to the Moores: I would estimate that the total cost of the Quiet Title Action would likely be in the $5,000 to $7,000 range. In view of my arguable exposure to a possible professional negligence claim ... I would be willing to undertake the Quiet Title Action on behalf of the Moores at one-half of my standard hourly rate (i.e. at $75.00 per hour instead of $150.00 per hour) for time expended, plus reimbursement for my out-of-pocket expenses and costs, should the Moores desire to consider this course. The Moores did not in fact pursue this course. Instead the Moores settled with the Kralls and filed suit against Breck for the difference. The Moores acted reasonably. They had a duty to mitigate their damages and, while it might have been unreasonable for them to refuse to allow Breck to attempt to quiet title at Breck's expense, the Moores were under no obligation to pay an attorney to cure his initial error.