                                            No. 02-409

               IN THE SUPREME COURT OF THE STATE OF MONTANA

                                            2003 MT 36



RANDY ARMBRUST and RAYMOND MONK,

              Plaintiffs and Respondents,

         v.

DAN L. YORK and DEBORAH L. YORK,

              Defendants and Appellants.




APPEAL FROM:         District Court of the Twenty-First Judicial District,
                     In and For the County of Ravalli, Cause No. DV-00-301,
                     Honorable Jeffrey H. Langton, Presiding


COUNSEL OF RECORD:

              For Appellants:

                     J. Tiffin Hall, Milodragovich, Dale, Steinbrenner & Binney, P.C.,
                     Missoula, Montana

              For Respondents:

                     Jeffrey B. Hays, Hays & Hayes, P.L.L.P., Hamilton, Montana




                                                    Submitted on Briefs: October 10, 2002

                                                              Decided: March 4, 2003

Filed:

                     __________________________________________
                                       Clerk
Justice W. William Leaphart delivered the Opinion of the Court.

¶1     Appellants, Dan and Deborah York, appeal from the judgment of the Twenty-First

Judicial District Court, Ravalli County, requiring them to remove a newly constructed garage

from their property. We affirm.

¶2     The following issue is raised on appeal:

¶3     Whether the District Court erred in determining that the Yorks’ construction of a

second garage on their property violated the one-garage restriction to which the property was

subject.

                              PROCEDURAL BACKGROUND

¶4     Raymond Monk, Randy Armbrust, and the Yorks own real property in the Home

Acres Orchards subdivision near Stevensville, Montana. Their properties are subject to the

same restrictive covenants, recorded on August 13, 1971. A family dwelling and garage

existed on the Yorks’ lot when they purchased the property in 1997.

¶5     Prior to constructing the building in dispute, the Yorks reviewed the subdivision’s

restrictive covenants and discovered a 100-foot setback restriction and a limitation of one

garage per property owner. The setback restriction provided that “[n]o buildings (including

any roof overhang) shall be located nearer than one hundred (100) feet to the outside

perimeter line of the owner’s track, except as approved by the Architectural Committee.”

The one-garage restriction provided that “[s]aid lot or lots may be improved by the erection

of a one (1) family dwelling, garage, guest house, or any other building necessary for the

family pets or animals . . . .”

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¶6     In the summer of 2000, the Yorks began construction on a second garage next to their

home. They sought approval from the architectural committee identified in the restrictive

covenants but discovered that the committee no longer existed. Nonetheless, the Yorks

proceeded with the project. The Yorks failed to inform Armbrust and Monk about the

project, and since neither Armbrust nor Monk reside on their property year-round, they only

first discovered the Yorks’ building in October 2000. Because the building was located

approximately 61 feet from the northeast corner of the Yorks’ lot and 55 feet from the

northwest corner, Armbrust and Monk notified the Yorks by letter that the building was in

violation of the setback restriction, and requested that the Yorks stop working on the

building.

¶7     Armbrust and Monk then filed suit to enforce the restrictive covenant and enjoin

construction. Since neither Armbrust nor Monk knew that the building would be a garage,

their Complaint made no mention of the one-garage restriction. They sought only to enforce

the setback restriction and to relocate the building. However, during trial, Dan York testified

that the building was, in fact, a garage separate and apart from his house, and admitted that

this second garage would violate the one-garage restriction.

¶8     The District Court issued its findings of fact and conclusions of law, and entered

judgment in favor of Monk and Armbrust. The court determined that the building violated

both the setback and one-garage restrictions, and ordered the Yorks to remove the garage

from their lot within 90 days. The Yorks appealed from that portion of the court’s decision

requiring them to remove the garage. In addition, Monk and Armbrust filed a motion to

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amend their Complaint to conform to the evidence at trial pursuant to Rule 15(b), M.R.Civ.P.

The new evidence, according to Monk and Armbrust, included Dan York’s admission that

the second garage violated the one-garage restriction. Although the District Court has not

ruled on the motion, it appears that the court’s judgment was based on this evidence.

                                       DISCUSSION

¶9     The pivotal question raised by this appeal is whether the issue of the one-garage

restriction was tried by the implied consent of the Yorks. In its conclusions of law, the

District Court determined that the building constructed by the Yorks was, in fact, a second

garage, and that the Yorks had, accordingly, violated the one-garage restriction. To effect

compliance with the restrictive covenant, the court ordered the Yorks to remove the garage

from their lot.

¶10    On appeal, the Yorks argue that the District Court’s conclusions amount to an abuse

of discretion, and specifically, that the court improperly based its judgment on a legal theory

not presented in the Complaint filed by Monk and Armbrust. As the Yorks observe, Monk

and Armbrust requested only that the District Court order the Yorks to move their building

to comply with the 100-foot setback restriction. The Yorks contend that the issue of the one-

garage restriction was not tried by the express or implied consent of the parties since it was

never raised in the pleadings and because they subsequently objected to the introduction of

any evidence regarding that issue. The Yorks conclude that the District Court should have

confined its judgment to the issues raised in the Complaint, and that the court erred when it



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determined that the Yorks’ building constituted a second garage in violation of the one-

garage restriction.

¶11     In response, Monk and Armbrust argue that the issue of the one-garage restriction was

tried by the implied consent of the Yorks by virtue of the fact that, on direct examination,

Dan York testified that the building was intended as a garage, and that it is separate from his

house. Monk and Armbrust also contend that they were unaware of the purpose of the

Yorks’ building prior to filing their Complaint and that, pursuant to Rule 15(b), M.R.Civ.P.,

they properly sought to amend the Complaint to conform to this new evidence.

¶12     Our standard of review of a trial court’s conclusions of law is whether the court’s

interpretation of the law is correct. Carbon County v. Union Reserve Coal Co. (1995), 271

Mont. 459, 469, 898 P.2d 680, 686. See also Kreger v. Francis (1995), 271 Mont. 444, 447,

898 P.2d 672, 674; Steer Inc. v. Dep’t of Revenue (1990), 245 Mont. 470, 474-75, 803 P.2d

601, 603-04.

¶13     Under Rule 15(b), M.R.Civ.P., “issues not raised by the pleadings may be tried by the

express or implied consent of the parties. If this occurs, then the pleadings can be amended

to conform to the issues actually litigated.” Glacier Nat’l Bank v. Challinor (1992), 253

Mont. 412, 416, 833 P.2d 1046, 1049. Furthermore, “it is within the discretion of the trial

court whether to allow such amendments . . . .” Challinor, 253 Mont. at 416, 833 P.2d at

1049.

¶14     The record supports the District Court’s decision to consider the one-garage

restriction as an issue consented to by the Yorks. During direct examination, Dan York

                                              5
testified that the building under construction on his lot was, in fact, a garage. The following

excerpts from the trial transcript of statements made by Dan York to his attorney during

direct examination, are illustrative:

       Q. When you purchased the property, was there already a house located on
       that lot No. 2?

       A. Yes, there was a house on lot No. 2.

       Q. And at some point—Or let me rephrase that. When did you decide that
       you wanted to build a garage then next to that house?

       A. We, as a family, had decided that we were going to build a garage on our
       property in August [of 2000].

¶15    York’s acknowledgment was sufficient to open the door to further inquiry by Monk

and Armbrust as to whether the building was a second garage and whether the Yorks had

violated the one-garage restriction. During cross-examination on these points, York admitted

that he was aware of and had reviewed the restrictive covenants before beginning

construction on the garage and that he knew the covenants permitted only one garage per lot.

These statements served as a basis for the District Court’s findings and conclusions that the

Yorks’ garage violated the one-garage restriction and that compliance with the covenant

required removal of the building.

¶16    Despite this, the Yorks assert that because they objected to the introduction of this

testimony during cross-examination, they cannot be deemed to have consented to the

litigation of the second garage issue. Granted, in past decisions, we have stated that implied

consent may be found when issues extrinsic to the pleadings are admitted at trial without

objection. See Ryan v. City of Bozeman (1996), 279 Mont. 507, 513, 928 P.2d 228, 232;

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Columbia Grain Int. v. Cereck (1993), 258 Mont. 414, 421, 852 P.2d 676, 680. However,

those decisions do not suggest that by objecting to the admission of evidence, the party

opposing the introduction of an issue can always avoid a determination by the court that he

or she impliedly consented to the litigation of the issue. Whereas the failure to object may

serve as an implied consent to the litigation of new issues, the existence of an objection will

not necessarily preclude a finding of implied consent. Thus, when applying the implied

consent rule, we consider the interplay of a variety of factors surrounding a party’s consent.

See McJunkin v. Kaufman and Broad Home Sys. (1987), 229 Mont. 432, 438, 748 P.2d 910,

914 (stating that in these decisions, “the facts attendant to each case become controlling”).

For example, in Challinor, we concluded that the respondent bank did not expressly or

impliedly consent to the litigation of a suretyship issue where “the record was replete with

objections” raised by the bank in response to the appellant’s attempts to offer evidence

concerning the issue. 253 Mont. at 417, 833 P.2d at 1049 (emphasis added).

¶17    This distinction is particularly relevant in the present case, where the Yorks objected

to attempts by Monk and Armbrust to explore the second garage issue, but only after first

introducing the issue themselves during their own presentation of evidence, i.e. through Dan

York’s testimony during direct examination. In addition, Monk and Armbrust were

previously unaware that the building under construction was a garage. They filed their

Complaint before the building was completed, and at the time of filing, had no knowledge

that the one-garage restriction was an issue.



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¶18    Rule 15(b) provides that “[i]f evidence is objected to at the trial on the ground that it

is not within the issues made by the pleadings, the court may allow the pleadings to be

amended . . . [if] the objecting party fails to satisfy the court that the admission of such

evidence would prejudice the party . . . .” Rule 15(b), M.R.Civ.P. The rule also states that

“[t]he court may grant a continuance to enable the objecting party to meet such evidence.”

Rule 15(b), M.R.Civ.P. Although the Yorks objected to the admission of evidence regarding

the issue of the one-garage restriction, they declined to seek a continuance or an opportunity

to meet this evidence. Neither did they argue to the District Court that the admission of Dan

York’s testimony resulted in prejudice to their case. Taken together, these factors support

a finding of implied consent by the Yorks despite their objection to the testimony elicited by

Monk and Armbrust.

¶19    In summary, we find that the Yorks’ argument that the District Court improperly

relied upon evidence concerning the garage issue is unpersuasive because, having raised the

issue during direct examination, the Yorks impliedly consented to its subsequent litigation.

Furthermore, in light of Dan York’s testimony that the building was a garage separate from

an existing house and garage, and that this second garage violated the one-garage restriction,

we hold that the District Court correctly concluded that the restrictive covenant was violated,

and that removal of the second garage was necessary in order to effect compliance with the

covenant.

¶20    Finally, we consider the propriety of the motion to amend filed by Monk and

Armbrust. The Yorks observe that Monk and Armbrust “never moved the [District Court],

                                               8
not even at trial, to amend their pleading to try the issue of whether the Yorks were in

violation of an alleged covenant prohibiting more than one garage,” and imply that the

absence of a Rule 15(b) motion made during trial precluded the District Court from

considering the issue of the one-garage restriction.

¶21    Although Monk and Armbrust did not file their motion to amend until after the court

issued its judgment, Rule 15(b) provides that a motion to amend pleadings may be made “at

any time, even after judgment; but failure to so amend does not affect the result of the trial

of these issues.” Rule 15(b), M.R.Civ.P. Applying Rule 15(b), this Court has stated that a

complaint may be amended even after an appeal. See Reilly v. Maw (1965), 146 Mont. 145,

155-56, 405 P.2d 440, 446-47. Accordingly, we reject the Yorks’ argument that Monk and

Armbrust’s motion to amend was untimely.




                                           /S/ W. WILLIAM LEAPHART



We concur:

/S/ KARLA M. GRAY
/S/ TERRY N. TRIEWEILER
/S/ JAMES C. NELSON




                                              9
Justice Jim Regnier dissenting.

¶22    I respectfully dissent.

¶23    In their complaint Armbrust and Monk sought to enforce the setback restriction but

not the one-garage restriction. The Court points out that neither Armbrust nor Monk knew

that the building being constructed was a garage and, therefore, their complaint made no

mention of the one-garage restriction. Assuming that the setback restriction was the only

issue being litigated, York responded to a question that the new construction was a "garage."

As a result of this spontaneous response, the District Court and this Court concluded that the

Yorks impliedly consented to litigate the one-garage restriction. The District Court then

permitted Monk and Armbrust to amend their complaint pursuant to Rule 15(b), M.R.Civ.P.,

after judgment was entered by the District Court.

¶24     Armbrust and Monk admit they knew a building was being constructed at the time

they filed their complaint, but since they did not know what the building was going to be

used for, they only alleged a violation of the setback restriction in their complaint. The

parties were clearly not prepared to litigate the one-garage restriction at trial and conse-

quently we are presented with an incomplete and somewhat sketchy record on the issue. For

example, we don't know if the Yorks intended to convert the attached garage to another use

after the new structure was built. Also, Dan York suggested that the new improvement may

be used as a wood shop and not as a garage in the traditional sense. None of this relevant

and important information was developed at the District Court. This is not surprising since

the one-garage restriction was not an issue that either party intended to litigate at the time

of trial. In fact, the District Court made no findings on the question of whether the Yorks'

                                             10
structure constituted a "garage" for purposes of the covenant that purports to restrict only one

garage per lot in the Home Acres Orchards Subdivision.

¶25    Simply because the Yorks or their attorney may have used the term "garage" when

responding to a question concerning the building does not establish conclusively that the

structure constitutes a second garage as defined and contemplated by the restrictive

covenants. I would remand this matter back to the District Court for a new trial on this issue.

I believe the Yorks should have an opportunity to present evidence as to whether or not the

building constitutes a second garage as envisioned by the covenants.


                                                   /S/ JIM REGNIER



Justices Patricia O. Cotter and Jim Rice join in the foregoing dissent.


                                                   /S/ PATRICIA COTTER
                                                   /S/ JIM RICE




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