Key Takeaways
- Montana requires sellers to provide an Owner's Property Disclosure Statement under MCA 70-20-305
- Disclosure must be provided before a purchase agreement is signed
- Montana's Mold Disclosure Act requires disclosure of known mold and any testing results
- Water rights disclosure is critical due to Montana's prior appropriation doctrine (MCA 70-20-201 & 70-20-202)
- Licensees must disclose any known adverse material facts that concern the property under MCA 37-51-313
Montana Disclosure Requirements
Montana requires specific disclosures in real estate transactions to protect consumers under Montana Code Annotated.
Agency Relationship Disclosure (MCA 37-51-314)
Timing of Disclosure
A broker or salesperson shall disclose the existence and nature of relevant agency relationships:
- Seller agent: At the time the listing agreement is executed
- Buyer agent: At the time the buyer representation agreement is executed
- All parties: Before any substantive discussions or confidential information is shared
What Must Be Disclosed
| Information | Requirement |
|---|---|
| Agency relationship | Who the licensee represents |
| Dual agency status | If representing both parties |
| Brokerage information | Name and address of firm |
| Written acknowledgment | Consumer should acknowledge receipt |
Owner's Property Disclosure Statement (MCA 70-20-305)
Montana requires sellers to provide a written property disclosure statement to buyers.
Timing
The disclosure must be provided before a purchase agreement is signed.
What the Disclosure Covers
| Category | Items |
|---|---|
| Structure | Foundation, roof, walls, floors |
| Systems | Electrical, plumbing, HVAC |
| Water | Source, wells, septic, water rights |
| Environment | Hazards, flooding, contamination |
| Legal | Easements, zoning, HOA |
| Defects | Known material facts and problems |
Exemptions from Seller Disclosure (MCA 37-51-402)
| Exemption | Description |
|---|---|
| New construction | By builder/contractor who has not occupied |
| Foreclosure sales | Sheriff, trustee, or court-ordered sales |
| Estate/probate sales | Executor, administrator, trustee in bankruptcy |
| Transfers between co-owners | Including immediate family |
| Divorce settlements | Court-ordered transfers |
| Eminent domain | Government proceedings |
Statute of Limitations
Claims related to property disclosures must be made within 3 years of the sale.
Mold Disclosure Act
Montana's Mold Disclosure Act has specific requirements:
What Must Be Disclosed
| Requirement | Details |
|---|---|
| Known mold | Must disclose presence of mold if known |
| Mold testing | Must disclose if testing was done |
| Test results | Must provide copy of test results to buyer |
| Mitigation | Must disclose any follow-up treatment |
Timing
Disclosure must be made before or simultaneously with signing the purchase contract.
Water Rights Disclosure (MCA 70-20-201 & 70-20-202)
Water rights disclosure is critical in Montana due to the state's agricultural heritage and water scarcity.
Why Water Rights Matter in Montana
| Factor | Importance |
|---|---|
| Agricultural use | Many properties have irrigation rights |
| Prior appropriation | "First in time, first in right" doctrine |
| Separate from land | Water rights may be sold separately |
| Value impact | Water rights significantly affect property value |
What Must Be Disclosed
| Water Rights Information | Disclosure Required |
|---|---|
| Existence of water rights | Yes |
| Type of water rights | Yes (irrigation, domestic, etc.) |
| Water source | Yes (river, stream, groundwater) |
| Priority date | Yes (if known) |
| Annual allocation | Yes (if known) |
| Whether rights transfer with property | Yes |
| Easements affecting water | Yes |
| Covenants affecting water use | Yes |
Montana's Prior Appropriation Doctrine
Montana follows the prior appropriation doctrine for water rights:
"First in time, first in right" - The person who first puts water to beneficial use has priority over later users.
| Term | Meaning |
|---|---|
| Appropriation | Taking water for beneficial use |
| Priority date | Date when right was established |
| Beneficial use | Irrigation, domestic, stock watering |
| Senior rights | Older rights with higher priority |
| Junior rights | Newer rights with lower priority |
Environmental Hazards Disclosure (MCA 75-9-401 & 75-9-402)
Sellers must disclose known environmental hazards:
- Underground storage tanks
- Hazardous waste sites
- Contamination on or near property
Lead-Based Paint Disclosure (Federal)
For homes built before 1978, federal law requires:
| Requirement | Details |
|---|---|
| Disclosure | Known lead-based paint hazards |
| Pamphlet | EPA pamphlet "Protect Your Family From Lead" |
| Inspection period | Buyer has 10 days to inspect (waivable) |
| Form | Lead-Based Paint Disclosure form |
Licensee Disclosure Requirements (MCA 37-51-313)
Real estate licensees have separate disclosure obligations:
| Duty | Requirement |
|---|---|
| Adverse material facts | Must disclose known facts affecting property |
| To whom | Buyer or buyer's agent |
| When | Before purchase agreement executed |
Key Point: A licensee cannot remain silent about known material defects, even if the seller chooses not to disclose.
When must the Owner's Property Disclosure Statement be provided in Montana?
What doctrine does Montana follow for water rights?
What does Montana's Mold Disclosure Act require?
What is the statute of limitations for property disclosure claims in Montana?