The name of the exception System.Xml.XPath.XPathException suggests that you are trying to do this using the XPath engine in .NET (it seems to be an endemic problem on this forum that people expect us to guess what products they are using...). This engine only supports XPath 1.0, which has no month-from-date() function.
Try Saxon instead, which runs under .NET and supports XPath 2.0.
Michael Kay
http://www.saxonica.com/
Author, XSLT 2.0 and XPath 2.0 Programmer's Reference