The waiver holding, and the two arguments it kills

Montana's waiver test comes from McKay v. Wilderness Development, 2009 MT 410, ¶ 28: the party asserting waiver must show the other party knew of the right, acted inconsistently with it, and prejudice resulted. Where waiver rests on a course of conduct, the result depends “upon the circumstances of each case and the character and materiality of the permitted breach.”

Applied here, two common owner arguments failed for structural reasons:

• Non-enforcement the association did not know about builds no waiver record. The defendants' course-of-conduct theory rested partly on breaches the plaintiff had no knowledge of. Knowledge is an element, not an inference.
• Conduct outside the covenanted tract is irrelevant. The rest of the theory rested on what landowners outside the subdivision were doing — parties not subject to its covenants. That disposes of the “look at the whole neighbourhood” argument, which is the version boards hear most often.

Express waiver was also unavailable, because the defendants had been “repeatedly informed about the covenants—during a conversation with Freeman, by their realtor at closing, on their title commitment, and on the Warranty Deed,” and the 2018 and 2020 listings described the property as residential. Laches did not apply.

Where this leaves a Montana board

Read against the rest of Montana's 2025 covenant law, Sloway is the counterweight. House Bill 147, effective May 5, 2025, wrote a statutory definition of “enforcement action” into § 70-17-210 requiring that a covenant be enforced “equally and consistently … on all properties subject to the covenant over at least a 2-year period” — which raised the bar for preserving a covenant. Sloway confirms that the common-law defences layered on top of that statute still have real elements the owner has to prove.²

Three practical points:

• Constructive notice matters. Title commitment, deed, listing and closing conversation all counted against the defendants' reliance argument. A record that the covenants were disclosed is worth keeping.
• Define the universe. When an owner says “everyone does it,” the first question is whether the properties they are pointing at are subject to the same covenants. Often they are not.
• Knowledge cuts both ways. The Court's test remains fact-driven on known and material permitted breaches. An association that has knowingly tolerated a material breach of the same covenant is in a different position from one that has not, and HB 147's two-year standard now applies to that record as well.

Standard of review, and why it made the appeal short

The injunction was reviewed for manifest abuse of discretion and the fee award for abuse of discretion. Neither is a friendly standard for an appellant. Declaratory relief on a covenant is available under § 27-8-202, MCA, and the Court's treatment of the case as a straightforward application of clear text meant there was little room to argue.

The result — injunction affirmed, remediation ordered, fees affirmed — is the outcome an association hopes for. Worth noting that it came in a subdivision with clear, specific, plainly worded covenants, which is the variable the association actually controls.