AWIN v. Whitehead Homes, 472 P.3d 165

AWIN Real Estate, LLC (AWIN) and Whitehead Homes, Inc. (WHI) executed an October 2007 Investment Agreement: Whitehead could acquire up to 33.33% of AWIN for $167,000 paid in three equal installments tied to a $500,000 valuation of AWIN and 713 E. 13th St.
Whitehead paid the first two installments ($56,000 each) but refused the third installment ($55,000) due on or before January 5, 2009.
AWIN obtained a prejudgment writ of attachment and seized WHI’s share (~$47,640) of proceeds from a 2014 sale of the building; the writ was later dissolved and WHI recovered its proceeds.
AWIN sued for breach of the Investment Agreement; WHI counterclaimed, alleging AWIN breached a separate Operating Agreement by denying access to financial records and sought damages and fees.
The District Court found the Investment Agreement ambiguous but concluded the parties intended Whitehead to become a one‑third owner upon making the three payments and awarded AWIN $55,000; it also found AWIN breached the Operating Agreement and awarded WHI $55,000.
The Montana Supreme Court affirmed that WHI breached the Investment Agreement, reversed the $55,000 award to WHI for breach of the Operating Agreement (insufficient evidence), and remanded for reconsideration of attorney’s fees.

Issue	Plaintiff's Argument (AWIN)	Defendant's Argument (WHI)	Held
Whether the Investment Agreement required Whitehead to make all three installments (i.e., was ambiguous and how to construe it)	The Agreement’s context and related documents show mutual intent that Whitehead would become a 1/3 owner by making the three installment payments	The phrase “may invest up to 33.33%” gave Whitehead an option to buy up to 33%; ambiguity should be construed against drafter (AWIN)	Court correctly found the Agreement ambiguous, examined extrinsic evidence, and reasonably concluded parties intended Whitehead to become a one‑third owner by making the installments; breach finding affirmed
Whether AWIN’s alleged breach of the Operating Agreement justified a $55,000 damages award to WHI	AWIN argued the District Court lacked evidence that denial of records caused monetary loss and WHI did not plead or quantify such damages	WHI argued it was damaged by AWIN’s withholding of financial records and sought offset/damages (claimed $15,608 pretrial)	Reversed: no substantial evidence or pleaded basis for $55,000 contract damages; award unsupported by pleadings/evidence; remand limited to consideration of attorney’s fees under the Operating Agreement

Watters v. City of Billings, 451 P.3d 60 (2019) (contract interpretation is a question of law)
Mary J. Baker Revocable Trust v. Cenex Harvest States Coops., Inc., 164 P.3d 851 (2007) (ambiguity and determining mutual intent; use of extrinsic evidence)
Ophus v. Fritz, 11 P.3d 1192 (2000) (definition and treatment of contract ambiguity)
Kuhr v. City of Billings, 168 P.3d 615 (2007) (standard of review for conclusions of law)
Watson v. West, 218 P.3d 1227 (2009) (damages as factual findings; compensatory purpose)
Hallenberg v. General Mills Operations, Inc., 141 P.3d 1216 (2006) (damages need reasonable basis; not mathematical precision)
Baston v. Baston, 240 P.3d 643 (2010) (setting aside damages awarded sua sponte when not pled)
Arcadia Fin., Ltd. v. Prestige Toyota, 989 P.2d 831 (1999) (damages to compensate nonbreaching party)
Mont. Health Network, Inc. v. Great Falls Orthopedic Assocs., 353 P.3d 483 (2015) (contracts must be given reasonable interpretation)
Denton v. First Interstate Bank of Commerce, 142 P.3d 797 (2006) (standard for reviewing factual findings)