Charles C. Bell and Shirley M. Bell, Plaintiffs-Appellants,
Land Title Guarantee Company, Orr Land Company LLC, and Tammy Ellerman, Defendants-Appellees.
County District Court No. 16CV30498 Honorable Todd L. Taylor,
Poulson, Odell & Peterson, LLC, Nick A. Swartzendruber,
Aaron G. Norris, Denver, Colorado, for Plaintiffs-Appellants
Frascona, Joiner, Goodman and Greenstein, PC, Britney D.
Beall-Eder, Cinthia Manzano, Boulder, Colorado; Robinson
Waters & O'Dorisio, PC, Stephen L. Waters, Kimberly
A. Bruetsch, Denver, Colorado, for Defendants-Appellees
1 We all know that we should read carefully and understand
any important document before we sign it. In fact, a
principle of contract law says that anyone who signs a
document is presumed to know its contents. We also know
generally that if we have a legal claim arising from a
document we've signed, we must file that claim in court
within a certain time or our claim may be barred by a statute
of limitations. And as to when that time starts to run,
another principle of law codified by a Colorado statute says
it starts on the date when both the claimant's injury and
its cause are known or should have been known by the exercise
of reasonable diligence.
2 This case poses a question arising from the intersection of
these two legal principles: Does the
presumed-to-know-what-you-signed principle conclusively
establish, as a matter of law, that the statute of
limitations for a claim against a third person who prepared
the document begins to run on the date the claimant signed
it? We conclude that it doesn't. So we reverse the
district court's order dismissing negligence and breach
of contract claims brought by plaintiffs, Charles C. Bell and
Shirley M. Bell, against defendants, Land Title Guarantee
Company (Land Title), Orr Land Company LLC (Orr), and Tammy
Facts and Procedural Background
3 The Bells hired Orr and its employee Ellerman to represent
them in selling their real property. Orr found a buyer,
the Bells entered into a buy and sell contract with the
buyer, which provided - as pertinent here - that the sale
excluded all oil, gas, and mineral rights in the property.
Orr then retained Land Title to draft closing documents,
including the warranty deed. On May 31, 2005, the Bells
signed the warranty deed and sold the property to the buyer.
4 The Bells didn't know that the warranty deed prepared
by Land Title didn't contain any language reserving the
Bells' mineral rights as provided in the buy and sell
contract. But, for over nine years, the Bells continued to
receive the mineral owner's royalty payments due under an
oil and gas lease on the property. In September 2014, the
lessee oil and gas company learned that the Bells hadn't
owned the mineral rights to the property since closing on the
buy and sell contract in May 2005. So, it began sending the
mineral owner's royalty payments to the buyer. After
that, the Bells discovered that the warranty deed they had
signed over nine years earlier didn't reserve their
mineral rights as provided in the buy and sell contract.
5 In May 2016, the Bells filed this negligence and breach of
contract action against defendants. Defendants filed motions
to dismiss under C.R.C.P. 12(b)(5), arguing that the
Bells' claims were untimely because the statute of
limitations had run.
6 The district court agreed and granted defendants'
motions to dismiss. The court reasoned that the Bells'
complaint showed that they had signed the deed in 2005
(eleven years before filing suit) and, because they were
charged with knowing the contents of the document they
signed, they should have discovered when they signed the deed
that it failed to reserve their mineral rights.
Statute of Limitations
7 The Bells contend that the court erred in granting
defendants' motions to dismiss because they sufficiently
alleged facts that, if true, establish that the statute of
limitations didn't begin to accrue on their claims until
the oil and gas company ceased payment in September 2014,
which is when they ...