96-616
No. 96-616
IN THE SUPREME COURT OF THE STATE OF MONTANA
1997
JOYCE TIPTON and
LEONA D. WETHERALL,
Plaintiffs and Appellants,
v.
TERRY T. BENNETT and
BRENDA M. BENNETT,
husband and wife,
Defendants, Respondents
and Cross-Appellants.
APPEAL FROM: District Court of the First Judicial District,
In and for the County of Lewis & Clark,
The Honorable Dorothy McCarter, Judge presiding.
COUNSEL OF RECORD:
For Appellants:
Thomas F. Dowling; Dowling Law Firm,
Helena, Montana
For Respondents:
Thomas Q. Johnson; Keller, Reynolds, Drake,
Johnson & Gillespie, Helena, Montana
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Submitted on Briefs: February 20, 1997
Decided: March 11, 1997
Filed:
__________________________________________
Clerk
Justice W. William Leaphart delivered the Opinion of the Court.
Joyce Tipton and Leona Wetherall filed suit against Terry and
Brenda Bennett seeking to enforce a restriction contained in the
Bennetts' deed. This is an appeal by Tipton and Wetherall from the
findings of fact, conclusions of law and order entered by the
District Court after a bench trial. The Bennetts filed a cross-
appeal. We affirm in part, reverse in part and remand for further
proceedings.
Background
Although the parties appeal from certain legal conclusions
reached by the court, they do not contest the court's findings of
fact. Accordingly, we set forth the following background which
tracks the District Court's factual recitation:
The Bennetts and Tipton entered into an agreement to sell and
purchase real property, dated January 12, 1994, whereby the
Bennetts were to purchase from Tipton six lots in the Seaver Park
Addition, East Helena, Montana. A counteroffer was executed
between the parties whereby the Bennetts acknowledged that Tipton's
deed restrictions were a part of any buy/sell agreement.
On February 11, 1994, a warranty deed was executed by Tipton
conveying the six lots to the Bennetts with the following deed
restrictions, among others:
That the real property hereof shall be used strictly for
residential purposes and no business, trade or
manufacture of any sort or nature shall be conducted
thereon.
After having purchased the lots, the Bennetts constructed a
storage building on the property. The building had a ground floor
area of 3,200 square feet and a height of 21 feet 1 inch.
Appellant Wetherall is the owner of the property immediately
adjacent to the Bennetts' property. Wetherall's property is
subject to the same deed restrictions set forth above.
Prior to purchasing this property, the Bennetts asked a real
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estate agent to show them some property on which they would be able
to construct a large storage-type building. The Bennetts purchased
the property in question after being assured by the real estate
agent that the deed restrictions did not preclude building such a
structure. The real estate agent advised Tipton that the Bennetts
intended to build a garage and then a house, six months to a year
later.
After purchasing the property, the Bennetts obtained a
building permit to construct the storage building. The stated
purpose of the building on the permit application was for "personal
storage." At trial, the Bennetts described the building as a large
garage. The court, however, found that it looked like a storage
building rather than a residential garage. To date, no house has
been erected on the property and the Bennetts testified that they
would not be building a house on the property for the next few
years.
The neighborhood in the immediate vicinity of the property in
question consists of single family residences. The court found
that, "[t]he storage building does not look like a large garage and
does not blend in with the character of the neighborhood." The
neighbors characterized the building as an eyesore and felt that
the building has devalued their properties. The Bennetts have been
storing only personal property in the building. There was no
evidence that they have used the building for commercial or
business purposes.
The Bennetts argue that since Tipton was forewarned of the
Bennetts' intent to build a storage building and since she
acquiesced in its construction, she is estopped from challenging
the existence of the building.
Having found the above facts, the District Court concluded
that the restrictions were clear and unambiguous and that the
Bennetts, although not in violation of the restriction on
commercial use of the property, were in violation of the "for
residential purposes only" restriction. The court then ordered
that the Bennetts either remove the storage building within six
months or place a residential dwelling on the property within one
year from the date of the order. The court rejected the Bennetts'
estoppel argument.
Discussion
Recently in Toavs v. Sayre (Mont. 1997), ___ P.2d ___ , (No.
96-611, decided March 4, 1997) we held:
In interpreting restrictive covenants, we apply the same
rules as apply to interpreting contracts. Gosnay v. Big
Sky Owners Ass'n (1983), 205 Mont. 221, 227, 666 P.2d
1247, 1250. We read all covenants as a whole to
ascertain their meaning. Gosnay, 666 P.2d at 1250.
Where the language of the covenant is clear and explicit,
that language will govern our interpretation of the
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covenants as a whole. The language of the covenant is to
be understood in its ordinary and popular sense. Section
28-3-501, MCA. Restrictive covenants are to be strictly
construed and ambiguities in a covenant are to be
construed to allow free use of the property. Town &
Country Estates Ass'n v. Slater (1987), 227 Mont. 489,
492, 740 P.2d 668, 670-71 (quoting State v. District
Court (1980), 187 Mont. 126, 130, 609 P.2d 245, 248).
However, the free use of the property must be balanced
against the rights of the other purchasers in the
subdivision.
Here, the deed in question restricts use of the property to
"residential" use only. The question presented is whether the
Bennetts' 3,200 square foot storage building is consistent with
that restriction. We addressed a similar question in Hillcrest
Homeowners Ass'n v. Wiley (1989), 239 Mont. 54, 778 P.2d 421.
Hillcrest involved restrictive covenants in a residential
subdivision which limited use to "single family residential
purposes." Wileys purchased a lot in the subdivision and erected
a steel sided garage. Seven years later, when Wileys had not
constructed a residence in conjunction with the garage, the
Homeowner's Association filed suit to have the garage removed. The
district court held that the garage did not violate the restrictive
covenants. Hillcrest, 778 P.2d at 422.
Relying on Webster's Ninth New Collegiate Dictionary (1986),
we defined "residential" as "'used as a residence or by
residents.'" "Residence" was defined as "'the act or fact of
dwelling in a place for some time.'" We then noted: "Consistent
with these definitions, courts have held that a garage built on a
lot without a dwelling house on the same lot violates a restrictive
covenant when the covenant specifically limits a lot's use to
'residential purposes.'" Hillcrest, 778 P.2d at 423. We also
quoted with approval the Washington Court of Appeals' holding that:
"A private garage is a proper appurtenance necessary to the
enjoyment of a dwelling house and does not violate a 'for residence
purposes only' covenant [cites omitted]." Hillcrest, 778 P.2d at
423 (citing Sandy Point Improvement Co. v. Huber (Wash.App. 1980),
613 P.2d 160). Based upon these authorities, we reversed the
district court, and held:
Reading the covenant as a whole and in light of the
popular and ordinary meaning of "residential," a garage,
by itself, is not consistent with "single family
residential purposes" when the garage is not used in
conjunction with a residential dwelling.
Hillcrest, 778 P.2d at 423.
In the present case, the District Court found that the
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building in question "is not even a garage, but a large storage
building." Thus, the court held that the Bennetts are in violation
of the covenant restricting use to "residential purposes." The
court then observed that the covenants do not prohibit a storage
building if its use is incidental to a residential dwelling located
on the property. Accordingly, the court ordered the Bennetts to
either remove the building within six months or construct a
residential dwelling on the premises within one year. We affirm
the court's conclusion that the building violates the covenant.
We reverse the court's order in that it allows the Bennetts to
keep the storage building on the condition that they construct a
residence on the property within one year. This later provision
assumes that any building used incidental to a residence is
permissible under the covenant. We hold that this interpretation
of the covenant is too broad. The covenant clearly and
unambiguously restricts usage to "residential purposes." The
question is whether a large storage building qualifies as "for
residential purposes." The District Court's own factual findings
do not support such a conclusion. In Hillcrest, we recognized that
a garage "is a proper appurtenance necessary to the enjoyment of a
dwelling house . . . . " Hillcrest, 778 P.2d at 423. In the
present suit, the District Court acknowledged that the structure is
not a garage; rather it is a 3,200 square foot storage building.
With or without a residence, a 3,200 square foot storage building
is not an appurtenance necessary to the enjoyment of a dwelling
house. The building violates the covenant, not only because it
stands alone without a dwelling, but also due to the fact that a
3,200 square foot storage building is not consistent with
"residential purposes." In that it allows the Bennetts to keep the
storage building on the condition that they construct a dwelling
within one year, the court's order is reversed.
The Bennetts' claim of estoppel
The Bennetts argue strenuously that, since Tipton knew, before
she sold the property to the Bennetts, that they planned to build
a storage building and since she acquiesced in its construction,
she is equitably estopped from complaining about the building. The
District Court rejected this theory.
Even assuming, for sake of argument only, that Tipton would
be equitably estopped from complaining, there is no argument or
basis for finding that Wetherall, the other plaintiff to this suit,
received any advance notice of the Bennetts' intent or that she
explicitly or impliedly consented to construction of the building.
That being the case, even if Tipton were estopped, we would arrive
at the same conclusions on the basis of Wetherall's complaint.
Accordingly, there is no need to discuss equitable estoppel. We
affirm the District Court in its rejection of the Bennetts'
estoppel theory.
Affirmed in part, reversed in part and remanded for further
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proceedings consistent herewith.
/S/ W. WILLIAM LEAPHART
We concur:
/S/ JAMES C. NELSON
/S/ JIM REGNIER
/S/ TERRY N. TRIEWEILER
/S/ KARLA M. GRAY
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