One fuzzy sentence in a Buy-Sell deal just sent a Montana commercial property fight back to court
A Montana Supreme Court ruling has revived a commercial storage-property dispute, signaling that ambiguous right-of-first-refusal clauses deserve a closer look.
The May 12, 2026 decision sent the case back to a Gallatin County judge, who had dismissed it without weighing evidence of what the two sides actually meant when they signed their deal.
The story begins in the spring of 2018 in Belgrade, Montana. BMK Enterprises, a mini-storage company owned by Ben and Myron Kovash, was buying a property on Briar Place from Bailey Enterprises of Montana that held roughly fifteen storage unit buildings. Joe Bailey and Michelle Franks, who own and manage Bailey, also owned the property next door at 151 Bolinger Road, a roughly eight-acre site with ten more storage buildings, a commercial office and shop space, a short-term vacation rental, and a residential home.
BMK liked what it saw and asked for dibs if Bailey ever sold the adjacent site. The parties tucked a single sentence into an exhibit of their Buy-Sell Agreement granting BMK the first right of refusal if Bailey sold storage units at 151 Bolinger, Belgrade, Montana.
That sentence is the heart of the case.
In September 2019, Bailey mentioned it might sell. BMK toured the Bolinger property again but did not pull the trigger. By July 2020 the property was listed. A year later, in August 2021, it sold to TruNorth Properties, LLC. BMK was not contacted before the deal closed.
BMK sued. According to its claim, Bailey had walked away from the deal it signed. The District Court did not see it that way. It ruled the right of first refusal too vague to enforce because nobody could tell, just by reading it, whether BMK had dibs on the entire property, just the storage buildings, or some carved-out slice. The judge granted summary judgment to Bailey and called it a day.
The state's high court was not satisfied. In a unanimous opinion by Justice Beth Baker, the court agreed the clause was ambiguous. The address 151 Bolinger covers the whole property, but the reference to storage units could narrow it to a piece of the site. Two reasonable readings, the court said, and that is the textbook definition of ambiguity.
Here is where the district judge went off track, the court explained. When contract language is murky, Montana law requires a judge to look beyond the page, at what the parties said, did, and understood when they signed, before declaring the deal unenforceable. Skipping that step was premature. The court pointed to two older Montana cases that walked through the same analysis, one tossing a vague preemptive right and one upholding it.
The dispute is far from over. The Supreme Court reversed the summary judgment and sent the case back to the District Court for the kind of fact-finding that should have happened the first time. No final determination has been made on whether Bailey breached the contract.
For real estate professionals, the takeaway is straightforward. A single ambiguous sentence in a Buy-Sell Agreement can spark years of litigation, and Montana courts will work hard to find a workable meaning before they throw a clause out.
