S.D. Codified Laws § 57A-2-613 — SD Code / Title 57A / Chapter 2 / Section 57A-2-613
Casualty to identified goods
Status: in_force

Where the contract requires for its performance goods identified when the contract is made, and the goods suffer casualty without fault of either party before the risk of loss passes to the buyer, or in a proper case under a "no arrival, no sale" term (§ 57A-2-324 ) then

(a) If the loss is total the contract is avoided; and

(b) If the loss is partial or the goods have so deteriorated as no longer to conform to the contract the buyer may nevertheless demand inspection and at his option either treat the contract as avoided or accept the goods with due allowance from the contract price for the deterioration or the deficiency in quantity but without further right against the seller.

Source: SL 1966, ch 150, § 2-613; SDCL, § 57-7-34.
S.D. Codified Laws § 57A-1-105 — SD Code / Title 57A / Chapter 1 / Section 57A-1-105
Severability
Status: in_force

If any provision or clause of this title or its application to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of this title which can be given effect without the invalid provision or application, and to this end the provisions of this title are severable.

Source: SL 2008, ch 259, § 5.
S.D. Codified Laws § 57A-8-205 — SD Code / Title 57A / Chapter 8 / Section 57A-8-205
Effect of unauthorized signature on security certificate
Status: in_force

An unauthorized signature placed on a security certificate before or in the course of issue is ineffective, but the signature is effective in favor of a purchaser for value of the certificated security if the purchaser is without notice of the lack of authority and the signing has been done by:

(1) An authenticating trustee, registrar, transfer agent, or other person entrusted by the issuer with the signing of the security certificate or of similar security certificates, or the immediate preparation for signing of any of them; or

(2) An employee of the issuer, or of any of the persons listed in paragraph (1), entrusted with responsible handling of the security certificate.

Source: SL 1998, ch 284, § 1.
S.D. Codified Laws § 57A-2-312 — SD Code / Title 57A / Chapter 2 / Section 57A-2-312
Warranty of title and against infringement--Buyer's obligation against infringement
Status: in_force

(1) Subject to subsection (2) there is in a contract for sale a warranty by the seller that

(a) The title conveyed shall be good, and its transfer rightful; and

(b) The goods shall be delivered free from any security interest or other lien or encumbrance of which the buyer at the time of contracting has no knowledge.

(2) A warranty under subsection (1) will be excluded or modified only by specific language or by circumstances which give the buyer reason to know that the person selling does not claim title in himself or that he is purporting to sell only such right or title as he or a third person may have.

(3) Unless otherwise agreed a seller who is a merchant regularly dealing in goods of the kind warrants that the goods shall be delivered free of the rightful claim of any third person by way of infringement or the like but a buyer who furnished specifications to the seller must hold the seller harmless against any such claim which arises out of compliance with the specifications.

Source: SL 1966, ch 150, § 2-312; SDCL, §§ 57-4-22 to 57-4-24.
S.D. Codified Laws § 57A-3-410 — SD Code / Title 57A / Chapter 3 / Section 57A-3-410
Acceptance varying draft
Status: in_force

(a) If the terms of a drawee's acceptance vary from the terms of the draft as presented, the holder may refuse the acceptance and treat the draft as dishonored. In that case, the drawee may cancel the acceptance.

(b) The terms of a draft are not varied by an acceptance to pay at a particular bank or place in the United States, unless the acceptance states that the draft is to be paid only at that bank or place.

(c) If the holder assents to an acceptance varying the terms of a draft, the obligation of each drawer and indorser that does not expressly assent to the acceptance is discharged.

Source: SL 1994, ch 367, § 3-410.
S.D. Codified Laws § 57A-2-326 — SD Code / Title 57A / Chapter 2 / Section 57A-2-326
Sale on approval and sale or return--Consignment sales and rights of creditors
Status: in_force

(1) Unless otherwise agreed, if delivered goods may be returned by the buyer even though they conform to the contract, the transaction is:

(a) A "sale on approval" if the goods are delivered primarily for use; and

(b) A "sale or return" if the goods are delivered primarily for resale.

(2) Goods held on approval are not subject to the claims of the buyer's creditors until acceptance; goods held on sale or return are subject to such claims while in the buyer's possession.

(3) Any "or return" term of a contract for sale is to be treated as a separate contract for sale within the statute of frauds section of this chapter (§ 57A-2-201 ) and as contradicting the sale aspect of the contract within the provisions of this chapter on parol or extrinsic evidence (§ 57A-2-202 ).

Source: SL 1966, ch 150, § 2-326; SDCL, §§ 57-4-64 to 57-4-67; SL 2000, ch 231, § 5.
S.D. Codified Laws § 57A-8-202 — SD Code / Title 57A / Chapter 8 / Section 57A-8-202
Issuer's responsibility and defenses; notice of defect or defense
Status: in_force

(a) Even against a purchaser for value and without notice, the terms of a certificated security include terms stated on the certificate and terms made part of the security by reference on the certificate to another instrument, indenture, or document or to a constitution, statute, ordinance, rule, regulation, order, or the like, to the extent the terms referred to do not conflict with terms stated on the certificate. A reference under this subsection does not of itself charge a purchaser for value with notice of a defect going to the validity of the security, even if the certificate expressly states that a person accepting it admits notice. The terms of an uncertificated security include those stated in any instrument, indenture, or document or in a constitution, statute, ordinance, rule, regulation, order, or the like, pursuant to which the security is issued.

(b) The following rules apply if an issuer asserts that a security is not valid:

(1) A security other than one issued by a government or governmental subdivision, agency, or instrumentality, even though issued with a defect going to its validity, is valid in the hands of a purchaser for value and without notice of the particular defect unless the defect involves a violation of a constitutional provision. In that case, the security is valid in the hands of a purchaser for value and without notice of the defect, other than one who takes by original issue.

(2) Paragraph (1) applies to an issuer that is a government or governmental subdivision, agency, or instrumentality only if there has been substantial compliance with the legal requirements governing the issue or the issuer has received a substantial consideration for the issue as a whole or for the particular security and a stated purpose of the issue is one for which the issuer has power to borrow money or issue the security.

(c) Except as otherwise provided in § 57A-8-205 , lack of genuineness of a certificated security is a complete defense, even against a purchaser for value and without notice.

(d) All other defenses of the issuer of a security, including nondelivery and conditional delivery of a certificated security, are ineffective against a purchaser for value who has taken the certificated security without notice of the particular defense.

(e) This section does not affect the right of a party to cancel a contract for a security "when, as and if issued" or "when distributed" in the event of a material change in the character of the security that is the subject of the contract or in the plan or arrangement pursuant to which the security is to be issued or distributed.

(f) If a security is held by a securities intermediary against whom an entitlement holder has a security entitlement with respect to the security, the issuer may not assert any defense that the issuer could not assert if the entitlement holder held the security directly.

Source: SL 1998, ch 284, § 1.
S.D. Codified Laws § 57A-3-207 — SD Code / Title 57A / Chapter 3 / Section 57A-3-207
Reacquisition
Status: in_force

Reacquisition of an instrument occurs if it is transferred to a former holder, by negotiation or otherwise. A former holder who reacquires the instrument may cancel indorsements made after the reacquirer first became a holder of the instrument. If the cancellation causes the instrument to be payable to the reacquirer or to bearer, the reacquirer may negotiate the instrument. An indorser whose indorsement is canceled is discharged, and the discharge is effective against any subsequent holder.

Source: SL 1994, ch 367, § 3-207.
S.D. Codified Laws § 57A-5-117 — SD Code / Title 57A / Chapter 5 / Section 57A-5-117
Subrogation of issuer, applicant, and nominated person
Status: in_force

(a) An issuer that honors a beneficiary's presentation is subrogated to the rights of the beneficiary to the same extent as if the issuer were a secondary obligor of the underlying obligation owed to the beneficiary and of the applicant to the same extent as if the issuer were the secondary obligor of the underlying obligation owed to the applicant.

(b) An applicant that reimburses an issuer is subrogated to the rights of the issuer against any beneficiary, presenter, or nominated person to the same extent as if the applicant were the secondary obligor of the obligations owed to the issuer and has the rights of subrogation of the issuer to the rights of the beneficiary stated in subsection (a).

(c) A nominated person who pays or gives value against a draft or demand presented under a letter of credit is subrogated to the rights of:

(1) The issuer against the applicant to the same extent as if the nominated person were a secondary obligor of the obligation owed to the issuer by the applicant;

(2) The beneficiary to the same extent as if the nominated person were a secondary obligor of the underlying obligation owed to the beneficiary; and

(3) The applicant to same extent as if the nominated person were a secondary obligor of the underlying obligation owed to the applicant.

(d) Notwithstanding any agreement or term to the contrary, the rights of subrogation stated in subsections (a) and (b) do not arise until the issuer honors the letter of credit or otherwise pays and the rights in subsection (c) do not arise until the nominated person pays or otherwise gives value. Until then, the issuer, nominated person, and the applicant do not derive under this section present or prospective rights forming the basis of a claim, defense, or excuse.

Source: SL 1998, ch 283, § 1.
S.D. Codified Laws § 57A-3-406 — SD Code / Title 57A / Chapter 3 / Section 57A-3-406
Negligence contributing to forged signature or alteration of instrument
Status: in_force

(a) A person whose failure to exercise ordinary care substantially contributes to an alteration of an instrument or to the making of a forged signature on an instrument is precluded from asserting the alteration or the forgery against a person who, in good faith, pays the instrument or takes it for value or for collection.

(b) Under subsection (a), if the person asserting the preclusion fails to exercise ordinary care in paying or taking the instrument and that failure substantially contributes to loss, the loss is allocated between the person precluded and the person asserting the preclusion according to the extent to which the failure of each to exercise ordinary care contributed to the loss.

(c) Under subsection (a), the burden of proving failure to exercise ordinary care is on the person asserting the preclusion. Under subsection (b), the burden of proving failure to exercise ordinary care is on the person precluded.

Source: SL 1994, ch 367, § 3-406.
S.D. Codified Laws § 57A-4A-104 — SD Code / Title 57A / Chapter 4A / Section 57A-4A-104
Funds transfer--Definitions
Status: in_force

In this chapter:

(a) "Funds transfer" means the series of transactions, beginning with the originator's payment order, made for the purpose of making payment to the beneficiary of the order. The term includes any payment order issued by the originator's bank or an intermediary bank intended to carry out the originator's payment order. A funds transfer is completed by acceptance by the beneficiary's bank of a payment order for the benefit of the beneficiary of the originator's payment order.

(b) "Intermediary bank" means a receiving bank other than the originator's bank or the beneficiary's bank.

(c) "Originator" means the sender of the first payment order in a funds transfer.

(d) "Originator's bank" means (i) the receiving bank to which the payment order of the originator is issued if the originator is not a bank, or (ii) the originator if the originator is a bank.

Source: SL 1991, ch 397, § 1.
S.D. Codified Laws § 57A-9-704 — SD Code / Title 57A / Chapter 9 / Section 57A-9-704
Enforceability and perfection of security interest enforceable immediately prior to July 1, 2001, and subordinate to lien creditor
Status: in_force

A security interest that is enforceable immediately before July 1, 2001, but which would be subordinate to the rights of a person that becomes a lien creditor at that time:

(1) Remains an enforceable security interest for one year after July 1, 2001;

(2) Remains enforceable thereafter if the security interest becomes enforceable under § 57A-9-203 on July 1, 2001, or within one year thereafter; and

(3) Becomes perfected:

(A) Without further action, on July 1, 2001, if the applicable requirements for perfection under this chapter are satisfied before or at that time; or

(B) When the applicable requirements for perfection are satisfied if the requirements are satisfied after that time.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-2-204 — SD Code / Title 57A / Chapter 2 / Section 57A-2-204
Formation in general
Status: in_force

(1) A contract for sale of goods may be made in any manner sufficient to show agreement, including conduct by both parties which recognizes the existence of such a contract.

(2) An agreement sufficient to constitute a contract for sale may be found even though the moment of its making is undetermined.

(3) Even though one or more terms are left open a contract for sale does not fail for indefiniteness if the parties have intended to make a contract and there is a reasonably certain basis for giving an appropriate remedy.

Source: SL 1966, ch 150, § 2-204; SDCL, §§ 57-3-6 to 57-3-8.
S.D. Codified Laws § 57A-5-103 — SD Code / Title 57A / Chapter 5 / Section 57A-5-103
Scope
Status: in_force

(a) This chapter applies to letters of credit and to certain rights and obligations arising out of transactions involving letters of credit.

(b) The statement of a rule in this chapter does not by itself require, imply, or negate application of the same or a different rule to a situation not provided for, or to a person not specified, in this chapter.

(c) With the exception of this subsection, subsections (a) and (d), §§ 57A-5-102(a)(9) and (10), 57A-5-106(d), and 57A-5-114(d), and except to the extent prohibited in §§ 57A-1-302 and 57A-5-117(d), the effect of this chapter may be varied by agreement or by a provision stated or incorporated by reference in an undertaking. A term in an agreement or undertaking generally excusing liability or generally limiting remedies for failure to perform obligations is not sufficient to vary obligations prescribed by this chapter.

(d) Rights and obligations of an issuer to a beneficiary or a nominated person under a letter of credit are independent of the existence, performance, or nonperformance of a contract or arrangement out of which the letter of credit arises or which underlies it, including contracts or arrangements between the issuer and the applicant and between the applicant and the beneficiary.

Source: SL 1998, ch 283, § 1; SL 2008, ch 259, § 40.
S.D. Codified Laws § 57A-7-208 — SD Code / Title 57A / Chapter 7 / Section 57A-7-208
Altered warehouse receipts
Status: in_force

If a blank in a negotiable tangible warehouse receipt has been filled in without authority, a good faith purchaser for value and without notice of the lack of authority may treat the insertion as authorized. Any other unauthorized alteration leaves any tangible or electronic warehouse receipt enforceable against the issuer according to its original tenor.

Source: SL 2009, ch 254, § 7-208.
S.D. Codified Laws § 57A-7-508 — SD Code / Title 57A / Chapter 7 / Section 57A-7-508
Warranties of collecting bank as to documents of title
Status: in_force

A collecting bank or other intermediary known to be entrusted with documents of title on behalf of another or with collection of a draft or other claim against delivery of documents warrants by the delivery of the documents only its own good faith and authority even if the collecting bank or other intermediary has purchased or made advances against the claim or draft to be collected.

Source: SL 2009, ch 254, § 7-508.
S.D. Codified Laws § 57A-4A-402 — SD Code / Title 57A / Chapter 4A / Section 57A-4A-402
Obligation of sender to pay receiving bank
Status: in_force

(a) This section is subject to §§ 57A-4A-205 and 57A-4A-207 .

(b) With respect to a payment order issued to the beneficiary's bank, acceptance of the order by the bank obliges the sender to pay the bank the amount of the order, but payment is not due until the payment date of the order.

(c) This subsection is subject to subsection (e) and to § 57A-4A-303 . With respect to a payment order issued to a receiving bank other than the beneficiary's bank, acceptance of the order by the receiving bank obliges the sender to pay the bank the amount of the sender's order. Payment by the sender is not due until the execution date of the sender's order. The obligation of that sender to pay its payment order is excused if the funds transfer is not completed by acceptance by the beneficiary's bank of a payment order instructing payment to the beneficiary of that sender's payment order.

(d) If the sender of a payment order pays the order and was not obliged to pay all or part of the amount paid, the bank receiving payment is obliged to refund payment to the extent the sender was not obliged to pay. Except as provided in §§ 57A-4A-204 and 57A-4A-304 , interest is payable on the refundable amount from the date of payment.

(e) If a funds transfer is not completed as stated in subsection (c) and an intermediary bank is obliged to refund payment as stated in subsection (d) but is unable to do so because not permitted by applicable law or because the bank suspends payments, a sender in the funds transfer that executed a payment order in compliance with an instruction, as stated in § 57A-4A-302(a)(1), to route the funds transfer through that intermediary bank is entitled to receive or retain payment from the sender of the payment order that it accepted. The first sender in the funds transfer that issued an instruction requiring routing through that intermediary bank is subrogated to the right of the bank that paid the intermediary bank to refund as stated in subsection (d).

(f) The right of the sender of a payment order to be excused from the obligation to pay the order as stated in subsection (c) or to receive refund under subsection (d) may not be varied by agreement.

Source: SL 1991, ch 397, § 1.
S.D. Codified Laws § 57A-2A-205 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-205
Firm offers
Status: in_force

An offer by a merchant to lease goods to or from another person in a signed record that by its terms gives assurance it will be held open is not revocable, for lack of consideration, during the time stated or, if no time is stated, for a reasonable time, but in no event may the period of irrevocability exceed three months. Any such term of assurance on a form supplied by the offeree must be separately signed by the offeror.

Source: SL 1989, ch 419, § 1; SL 2024, ch 198, § 19.
S.D. Codified Laws § 57A-2A-210 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-210
Express warranties
Status: in_force

(1) Express warranties by the lessor are created as follows:

(a) Any affirmation of fact or promise made by the lessor to the lessee which relates to the goods and becomes part of the basis of the bargain creates an express warranty that the goods will conform to the affirmation or promise.

(b) Any description of the goods which is made part of the basis of the bargain creates an express warranty that the goods will conform to the description.

(c) Any sample or model that is made part of the basis of the bargain creates an express warranty that the whole of the goods will conform to the sample or model.

(2) It is not necessary to the creation of an express warranty that the lessor use formal words, such as "warrant" or "guarantee," or that the lessor have a specific intention to make a warranty, but an affirmation merely of the value of the goods or a statement purporting to be merely the lessor's opinion or commendation of the goods does not create a warranty.

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-2A-502 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-502
Notice after default
Status: in_force

Except as otherwise provided in this chapter or the lease agreement, the lessor or lessee in default under the lease contract is not entitled to notice of default or notice of enforcement from the other party to the lease agreement.

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-2-103 — SD Code / Title 57A / Chapter 2 / Section 57A-2-103
Definitions and index of definitions
Status: in_force

(1) In this chapter unless the context otherwise requires:

(a) "Buyer" means a person who buys or contracts to buy goods.

(b) (Reserved.)

(c) "Receipt" of goods means taking physical possession of them.

(d) "Seller" means a person who sells or contracts to sell goods.

(2) Other definitions applying to this chapter or to specified parts thereof, and the sections in which they appear are:

"Acceptance." § 57A-2-606 .

"Banker's credit." § 57A-2-325 .

"Between merchants." § 57A-2-104 .

"Cancellation." § 57A-2-106(4).

"Commercial unit." § 57A-2-105 .

"Confirmed credit." § 57A-2-325 .

"Conforming to contract." § 57A-2-106 .

"Contract for sale." § 57A-2-106 .

"Cover." § 57A-2-712 .

"Entrusting." § 57A-2-403 .

"Financing agency." § 57A-2-104 .

"Future goods." § 57A-2-105 .

"Goods." § 57A-2-105 .

"Identification." § 57A-2-501 .

"Installment contract." § 57A-2-612 .

"Letter of credit." § 57A-2-325 .

"Lot." § 57A-2-105 .

"Merchant." § 57A-2-104 .

"Overseas." § 57A-2-323 .

"Person in position of seller." § 57A-2-707 .

"Present sale." § 57A-2-106 .

"Sale." § 57A-2-106 .

"Sale on approval." § 57A-2-326 .

"Sale or return." § 57A-2-326 .

"Termination." § 57A-2-106 .

(3) The following definitions in other chapters apply to this chapter:

"Check." § 57A-3-104 .

"Consignee." § 57A-7-102 .

"Consignor." § 57A-7-102 .

"Consumer goods." § 57A-9-102 .

"Control." § 57A-7-106 .

"Dishonor." § 57A-3-502 .

"Draft." § 57A-3-104 .

(4) In addition chapter 57A-1 contains general definitions and principles of construction and interpretation applicable throughout this chapter.

Source: SL 1966, ch 150, § 2-103; SDCL §§ 57-2-3 to 57-2-6; SL 2000, ch 231, § 3; SL 2008, ch 259, § 25; SL 2009, ch 254, § 806.
S.D. Codified Laws § 57A-4A-205 — SD Code / Title 57A / Chapter 4A / Section 57A-4A-205
Erroneous payment orders
Status: in_force

(a) If an accepted payment order was transmitted pursuant to a security procedure for the detection of error and the payment order (i) erroneously instructed payment to a beneficiary not intended by the sender, (ii) erroneously instructed payment in an amount greater than the amount intended by the sender, or (iii) was an erroneously transmitted duplicate of a payment order previously sent by the sender, the following rules apply:

(1) If the sender proves that the sender or a person acting on behalf of the sender pursuant to § 57A-4A-206 complied with the security procedure and that the error would have been detected if the receiving bank had also complied, the sender is not obliged to pay the order to the extent stated in paragraphs (2) and (3).

(2) If the funds transfer is completed on the basis of an erroneous payment order described in clause (i) or (iii) of subsection (a), the sender is not obliged to pay the order and the receiving bank is entitled to recover from the beneficiary any amount paid to the beneficiary to the extent allowed by the law governing mistake and restitution.

(3) If the funds transfer is completed on the basis of a payment order described in clause (ii) of subsection (a), the sender is not obliged to pay the order to the extent the amount received by the beneficiary is greater than the amount intended by the sender. In that case, the receiving bank is entitled to recover from the beneficiary the excess amount received to the extent allowed by the law governing mistake and restitution.

(b) If (i) the sender of an erroneous payment order described in subsection (a) is not obliged to pay all or part of the order, and (ii) the sender receives notification from the receiving bank that the order was accepted by the bank or that the sender's account was debited with respect to the order, the sender has a duty to exercise ordinary care, on the basis of information available to the sender, to discover the error with respect to the order and to advise the bank of the relevant facts within a reasonable time, not exceeding ninety days, after the bank's notification was received by the sender. If the bank proves that the sender failed to perform that duty, the sender is liable to the bank for the loss the bank proves it incurred as a result of the failure, but the liability of the sender may not exceed the amount of the sender's order.

(c) This section applies to amendments to payment orders to the same extent it applies to payment orders.

Source: SL 1991, ch 397, § 1.
S.D. Codified Laws § 57A-9-335 — SD Code / Title 57A / Chapter 9 / Section 57A-9-335
Security interest in accession--Collateral that becomes an accession
Status: in_force

(a) A security interest may be created in an accession and continues in collateral that becomes an accession.

(b) If a security interest is perfected when the collateral becomes an accession, the security interest remains perfected in the collateral.

(c) Except as otherwise provided in subsection (d), the other provisions of this part determine the priority of a security interest in an accession.

(d) A security interest in an accession is subordinate to a security interest in the whole which is perfected by compliance with the requirements of a certificate - of - title statute under § 57A-9-311(b).

(e) After default, subject to Part 6, a secured party may remove an accession from other goods if the security interest in the accession has priority over the claims of every person having an interest in the whole.

(f) A secured party that removes an accession from other goods under subsection (e) shall promptly reimburse any holder of a security interest or other lien on, or owner of, the whole or of the other goods, other than the debtor, for the cost of repair of any physical injury to the whole or the other goods. The secured party need not reimburse the holder or owner for any diminution in value of the whole or the other goods caused by the absence of the accession removed or by any necessity for replacing it. A person entitled to reimbursement may refuse permission to remove until the secured party gives adequate assurance for the performance of the obligation to reimburse.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-2-325 — SD Code / Title 57A / Chapter 2 / Section 57A-2-325
"Letter of credit" term--"Confirmed credit"
Status: in_force

(1) Failure of the buyer seasonably to furnish an agreed letter of credit is a breach of the contract for sale.

(2) The delivery to seller of a proper letter of credit suspends the buyer's obligation to pay. If the letter of credit is dishonored, the seller may on seasonable notification to the buyer require payment directly from him.

(3) Unless otherwise agreed the term "letter of credit" or "banker's credit" in a contract for sale means an irrevocable credit issued by a financing agency of good repute and, where the shipment is overseas, of good international repute. The term "confirmed credit" means that the credit must also carry the direct obligation of such an agency which does business in the seller's financial market.

Source: SL 1966, ch 150, § 2-325; SDCL, §§ 57-4-61 to 57-4-63.
S.D. Codified Laws § 57A-2-505 — SD Code / Title 57A / Chapter 2 / Section 57A-2-505
Seller's shipment under reservation
Status: in_force

(1) Where the seller has identified goods to the contract by or before shipment:

(a) His procurement of a negotiable bill of lading to his own order or otherwise reserves in him a security interest in the goods. His procurement of the bill to the order of a financing agency or of the buyer indicates in addition only the seller's expectation of transferring that interest to the person named.

(b) A nonnegotiable bill of lading to himself or his nominee reserves possession of the goods as security but except in a case of conditional delivery (subsection (2) of § 57A-2-507 ) a nonnegotiable bill of lading naming the buyer as consignee reserves no security interest even though the seller retains possession or control of the bill of lading.

(2) When shipment by the seller with reservation of a security interest is in violation of the contract for sale it constitutes an improper contract for transportation within § 57A-2-504 but impairs neither the rights given to the buyer by shipment and identification of the goods to the contract nor the seller's powers as a holder of a negotiable document of title.

Source: SL 1966, ch 150, § 2-505; SDCL §§ 57-6-12 to 57-6-14; SL 2009, ch 254, § 812.
S.D. Codified Laws § 57A-9-318 — SD Code / Title 57A / Chapter 9 / Section 57A-9-318
Effect of sale of collateral on rights of debtor
Status: in_force

(a) A debtor that has sold an account, chattel paper, payment intangible, or promissory note does not retain a legal or equitable interest in the collateral sold.

(b) For purposes of determining the rights of creditors of, and purchasers for value of an account or chattel paper from, a debtor that has sold an account or chattel paper, while the buyer's security interest is unperfected, the debtor is deemed to have rights and title to the account or chattel paper identical to those the debtor sold.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-2A-219 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-219
Risk of loss
Status: in_force

(1) Except in the case of a finance lease, risk of loss is retained by the lessor and does not pass to the lessee. In the case of a finance lease, risk of loss passes to the lessee.

(2) Subject to the provisions of this chapter on the effect of default on risk of loss in § 57A-2A-220 , if risk of loss is to pass to the lessee and the time of passage is not stated, the following rules apply:

(a) If the lease contract requires or authorizes the goods to be shipped by carrier:

(i) And it does not require delivery at a particular destination, the risk of loss passes to the lessee when the goods are duly delivered to the carrier; but

(ii) If it does require delivery at a particular destination and the goods are there duly tendered while in the possession of the carrier, the risk of loss passes to the lessee when the goods are there duly so tendered as to enable the lessee to take delivery.

(b) If the goods are held by a bailee to be delivered without being moved, the risk of loss passes to the lessee on acknowledgment by the bailee of the lessee's right to possession of the goods.

(c) In any case not within subsection (a) or subsection (b) of this section, the risk of loss passes to the lessee on the lessee's receipt of the goods if the lessor, or, in the case of a finance lease, the supplier, is a merchant; otherwise, the risk passes to the lessee on tender of delivery.

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-9-333 — SD Code / Title 57A / Chapter 9 / Section 57A-9-333
"Possessory lien"--Priority over security interest
Status: in_force

(a) In this section, "possessory lien" means an interest, other than a security interest or an agricultural lien:

(1) Which secures payment or performance of an obligation for services or materials furnished with respect to goods by a person in the ordinary course of the person's business;

(2) Which is created by statute or rule of law in favor of the person; and

(3) Whose effectiveness depends on the person's possession of the goods.

(b) A possessory lien on goods has priority over a security interest in the goods unless the lien is created by a statute that expressly provides otherwise.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-8-401 — SD Code / Title 57A / Chapter 8 / Section 57A-8-401
Duty of issuer to register transfer
Status: in_force

(a) If a certificated security in registered form is presented to an issuer with a request to register transfer or an instruction is presented to an issuer with a request to register transfer of an uncertificated security, the issuer shall register the transfer as requested if:

(1) Under the terms of the security the person seeking registration of transfer is eligible to have the security registered in its name;

(2) The indorsement or instruction is made by the appropriate person or by an agent who has actual authority to act on behalf of the appropriate person;

(3) Reasonable assurance is given that the indorsement or instruction is genuine and authorized (§ 57A-8-402 );

(4) Any applicable law relating to the collection of taxes has been complied with;

(5) The transfer does not violate any restriction on transfer imposed by the issuer in accordance with § 57A-8-204 ;

(6) A demand that the issuer not register transfer has not become effective under § 57A-8-403 , or the issuer has complied with § 57A-8-403(b) but no legal process or indemnity bond is obtained as provided in § 57A-8-403(d); and

(7) The transfer is in fact rightful or is to a protected purchaser.

(b) If an issuer is under a duty to register a transfer of a security, the issuer is liable to a person presenting a certificated security or an instruction for registration or to the person's principal for loss resulting from unreasonable delay in registration or failure or refusal to register the transfer.

Source: SL 1998, ch 284, § 1.
S.D. Codified Laws § 57A-9-302 — SD Code / Title 57A / Chapter 9 / Section 57A-9-302
Law governing perfection and priority issues relating to farm products
Status: in_force

While farm products are located in a jurisdiction, the local law of that jurisdiction governs perfection, the effect of perfection or nonperfection, and the priority of an agricultural lien on the farm products.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-9-206 — SD Code / Title 57A / Chapter 9 / Section 57A-9-206
Interest in favor of securities intermediary--Interest in favor of person who delivers financial asset
Status: in_force

(a) A security interest in favor of a securities intermediary attaches to a person's security entitlement if:

(1) The person buys a financial asset through the securities intermediary in a transaction in which the person is obligated to pay the purchase price to the securities intermediary at the time of the purchase; and

(2) The securities intermediary credits the financial asset to the buyer's securities account before the buyer pays the securities intermediary .

(b) The security interest described in subsection (a) secures the person's obligation to pay for the financial asset.

(c) A security interest in favor of a person that delivers a certificated security or other financial asset represented by a writing attaches to the security or other financial asset if:

(1) The security or other financial asset:

(A) In the ordinary course of business is transferred by delivery with any necessary indorsement or assignment; and

(B) Is delivered under an agreement between persons in the business of dealing with such securities or financial assets; and

(2) The agreement calls for delivery against payment.

(d) The security interest described in subsection (c) secures the obligation to make payment for the delivery.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-4-403 — SD Code / Title 57A / Chapter 4 / Section 57A-4-403
Customer's right to stop payment--Burden of proof of loss
Status: in_force

(a) A customer or any person authorized to draw on the account if there is more than one person may stop payment of any item drawn on the customer's account or close the account by an order to the bank describing the item or account with reasonable certainty received at a time and in a manner that affords the bank a reasonable opportunity to act on it before any action by the bank with respect to the item described in § 57A-4-303 . If the signature of more than one person is required to draw on an account, any of these persons may stop payment or close the account.

(b) A stop - payment order is effective for six months, but it lapses after fourteen calendar days if the original order was oral and was not confirmed in writing within that period. A stop - payment order may be renewed for additional six - month periods by a writing given to the bank within a period during which the stop - payment order is effective.

(c) The burden of establishing the fact and amount of loss resulting from the payment of an item contrary to a stop - payment order or order to close an account is on the customer. The loss from payment of an item contrary to a stop - payment order may include damages for dishonor of subsequent items under § 57A-4-402 .

Source: SL 1994, ch 368, § 4-403.
S.D. Codified Laws § 57A-13-101 — SD Code / Title 57A / Chapter 13 / Section 57A-13-101
Short title
Status: in_force

This chapter may be cited as Transitional Provisions for Uniform Commercial Code Amendments (2022).

Source: SL 2024, ch 198, § 101.
S.D. Codified Laws § 57A-4A-504 — SD Code / Title 57A / Chapter 4A / Section 57A-4A-504
Order in which items and payment orders may be charged to account--Order of withdrawals from account
Status: in_force

(a) If a receiving bank has received more than one payment order of the sender or one or more payment orders and other items that are payable from the sender's account, the bank may charge the sender's account with respect to the various orders and items in any sequence.

(b) In determining whether a credit to an account has been withdrawn by the holder of the account or applied to a debt of the holder of the account, credits first made to the account are first withdrawn or applied.

Source: SL 1991, ch 397, § 1.
S.D. Codified Laws § 57A-13-302 — SD Code / Title 57A / Chapter 13 / Section 57A-13-302
Security interest perfected before effective date
Status: in_force

(a) A security interest that is enforceable and perfected immediately before July 1, 2024, is a perfected security interest under SL 2024, ch 198 if, on July 1, 2024, the requirements for enforceability and perfection under SL 2024, ch 198 are satisfied without further action.

(b) If a security interest is enforceable and perfected immediately before July 1, 2024, but the requirements for enforceability or perfection under SL 2024, ch 198 are not satisfied on July 1, 2024, the security interest:

(1) Is a perfected security interest until the earlier of the time perfection would have ceased under the law in effect immediately before July 1, 2024, or the adjustment date;

(2) Remains enforceable thereafter only if the security interest satisfies the requirements for enforceability under § 57A-9-203 , as amended by SL 2024, ch 198, before the adjustment date; and

(3) Remains perfected thereafter only if the requirements for perfection under SL 2024, ch 198 are satisfied before the time specified in paragraph (1).

Source: SL 2024, ch 198, § 105.
S.D. Codified Laws § 57A-9-628 — SD Code / Title 57A / Chapter 9 / Section 57A-9-628
Nonliability and limitation on liability of secured party--Liability of secondary obligor
Status: in_force

(a) Subject to subsection (f), unless a secured party knows that a person is a debtor or obligor, knows the identity of the person, and knows how to communicate with the person:

(1) The secured party is not liable to the person, or to a secured party or lienholder that has filed a financing statement against the person, for failure to comply with this chapter; and

(2) The secured party's failure to comply with this chapter does not affect the liability of the person for a deficiency.

(b) Subject to subsection (f), a secured party is not liable because of its status as secured party:

(1) To a person that is a debtor or obligor, unless the secured party knows:

(A) That the person is a debtor or obligor;

(B) The identity of the person; and

(C) How to communicate with the person; or

(2) To a secured party or lienholder that has filed a financing statement against a person, unless the secured party knows:

(A) That the person is a debtor; and

(B) The identity of the person.

(c) A secured party is not liable to any person, and a person's liability for a deficiency is not affected, because of any act or omission arising out of the secured party's reasonable belief that a transaction is not a consumer - goods transaction or a consumer transaction or that goods are not consumer goods, if the secured party's belief is based on its reasonable reliance on:

(1) A debtor's representation concerning the purpose for which collateral was to be used, acquired, or held; or

(2) An obligor's representation concerning the purpose for which a secured obligation was incurred.

(d) A secured party is not liable to any person under § 57A-9-625 (c)(2) for its failure to comply with § 57A-9-616 .

(e) A secured party is not liable under § 57A-9-625 (c)(2) more than once with respect to any one secured obligation.

(f) Subsections (a) and (b) do not apply to limit the liability of a secured party to a person if, at the time the secured party obtains control of collateral that is a controllable account, controllable electronic record, or controllable payment intangible or at the time the security interest attaches to the collateral, whichever is later:

(1) The person is a debtor or obligor; and

(2) The secured party knows that the information in subsection (b)(1)(A), (B), or (C) relating to the person is not provided by the collateral, a record attached to or logically associated with the collateral, or the system in which the collateral is recorded.

Source: SL 2000, ch 231; SL 2024, ch 198, § 92.
S.D. Codified Laws § 57A-3-408 — SD Code / Title 57A / Chapter 3 / Section 57A-3-408
Drawee not liable on unaccepted draft
Status: in_force

A check or other draft does not of itself operate as an assignment of funds in the hands of the drawee available for its payment, and the drawee is not liable on the instrument until the drawee accepts it.

Source: SL 1994, ch 367, § 3-408.
S.D. Codified Laws § 57A-4-206 — SD Code / Title 57A / Chapter 4 / Section 57A-4-206
Transfer between banks
Status: in_force

Any agreed method that identifies the transferor bank is sufficient for the item's further transfer to another bank.

Source: SL 1994, ch 368, § 4-206.
S.D. Codified Laws § 57A-9-203 — SD Code / Title 57A / Chapter 9 / Section 57A-9-203
Attachment and enforceability of security interest--Proceeds--Supporting obligations--Formal requisites
Status: in_force

(a) A security interest attaches to collateral when it becomes enforceable against the debtor with respect to the collateral, unless an agreement expressly postpones the time of attachment.

(b) Except as otherwise provided in subsections (c) through (i), a security interest is enforceable against the debtor and third parties with respect to the collateral only if:

(1) Value has been given;

(2) The debtor has rights in the collateral or the power to transfer rights in the collateral to a secured party; and

(3) One of the following conditions is met:

(A) The debtor has signed a security agreement that provides a description of the collateral and, if the security interest covers timber to be cut, a description of the land concerned;

(B) The collateral is not a certificated security and is in the possession of the secured party under § 57A-9-313 pursuant to the debtor's security agreement;

(C) The collateral is a certificated security in registered form and the security certificate has been delivered to the secured party under § 57A-8-301 pursuant to the debtor's security agreement;

(D) The collateral is controllable accounts, controllable electronic records, controllable payment intangibles, deposit accounts, electronic documents, electronic money, investment property, or letter-of-credit rights, and the secured party has control under § 57A-7-106 , 57A-9-104 , 57A-9-105.1 , 57A-9-106 , 57A-9-107 , or 57A-9-107.1 pursuant to the debtor's security agreement; or

(E) The collateral is chattel paper and the secured party has possession and control under § 57A-9-314.1 pursuant to the debtor's security agreement.

(c) Subsection (b) is subject to § 57A-4-210 on the security interest of a collecting bank, § 57A-5-118 on the security interest of a letter-of-credit issuer or nominated person, § 57A-9-110 on a security interest arising under chapter 57A-2 or 57A-2A , and § 57A-9-206 on security interests in investment property.

(d) A person becomes bound as debtor by a security agreement entered into by another person if, by operation of law other than this chapter or by contract:

(1) The security agreement becomes effective to create a security interest in the person's property; or

(2) The person becomes generally obligated for the obligations of the other person, including the obligation secured under the security agreement, and acquires or succeeds to all or substantially all of the assets of the other person.

(e) If a new debtor becomes bound as debtor by a security agreement entered into by another person:

(1) The agreement satisfies subsection (b)(3) with respect to existing or after-acquired property of the new debtor to the extent the property is described in the agreement; and

(2) Another agreement is not necessary to make a security interest in the property enforceable.

(f) The attachment of a security interest in collateral gives the secured party the rights to proceeds provided by § 57A-9-315 and is also attachment of a security interest in a supporting obligation for the collateral.

(g) The attachment of a security interest in a right to payment or performance secured by a security interest or other lien on personal or real property is also attachment of a security interest in the security interest, mortgage, or other lien.

(h) The attachment of a security interest in a securities account is also attachment of a security interest in the security entitlements carried in the securities account.

(i) The attachment of a security interest in a commodity account is also attachment of a security interest in the commodity contracts carried in the commodity account.

Source: SL 2000, ch 231; SL 2009, ch 254, § 826; SL 2024, ch 198, § 49.
S.D. Codified Laws § 57A-4-207 — SD Code / Title 57A / Chapter 4 / Section 57A-4-207
Transfer warranties
Status: in_force

(a) A customer or collecting bank that transfers an item and receives a settlement or other consideration warrants to the transferee and to any subsequent collecting bank that:

(1) The warrantor is a person entitled to enforce the item;

(2) All signatures on the item are authentic and authorized;

(3) The item has not been altered;

(4) The item is not subject to a defense or claim in recoupment (§ 57A-3-305(a)) of any party that can be asserted against the warrantor; and

(5) The warrantor has no knowledge of any insolvency proceeding commenced with respect to the maker or acceptor or, in the case of an unaccepted draft, the drawer.

(b) If an item is dishonored, a customer or collecting bank transferring the item and receiving settlement or other consideration is obliged to pay the amount due on the item (i) according to the terms of the item at the time it was transferred, or (ii) if the transfer was of an incomplete item, according to its terms when completed as stated in §§ 57A-3-115 and 57A-3-407 . The obligation of a transferor is owed to the transferee and to any subsequent collecting bank that takes the item in good faith. A transferor cannot disclaim its obligation under this subsection by an indorsement stating that it is made "without recourse" or otherwise disclaiming liability.

(c) A person to whom the warranties under subsection (a) are made and who took the item in good faith may recover from the warrantor as damages for breach of warranty an amount equal to the loss suffered as a result of the breach, but not more than the amount of the item plus expenses and loss of interest incurred as a result of the breach.

(d) The warranties stated in subsection (a) cannot be disclaimed with respect to checks. Unless notice of a claim for breach of warranty is given to the warrantor within thirty days after the claimant has reason to know of the breach and the identity of the warrantor, the warrantor is discharged to the extent of any loss caused by the delay in giving notice of the claim.

(e) A cause of action for breach of warranty under this section accrues when the claimant has reason to know of the breach.

Source: SL 1994, ch 368, § 4-207.
S.D. Codified Laws § 57A-2A-215 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-215
Cumulation and conflict of warranties express or implied
Status: in_force

Warranties, whether express or implied, must be construed as consistent with each other and as cumulative, but if that construction is unreasonable, the intention of the parties determines which warranty is dominant. In ascertaining that intention the following rules apply:

(a) Exact or technical specifications displace an inconsistent sample or model or general language of description.

(b) A sample from an existing bulk displaces inconsistent general language of description.

(c) Express warranties displace inconsistent implied warranties other than an implied warranty of fitness for a particular purpose.

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-2-207 — SD Code / Title 57A / Chapter 2 / Section 57A-2-207
Additional terms in acceptance or confirmation
Status: in_force

(1) A definite and seasonable expression of acceptance or a written confirmation which is sent within a reasonable time operates as an acceptance even though it states terms additional to or different from those offered or agreed upon, unless acceptance is expressly made conditional on assent to the additional or different terms.

(2) The additional terms are to be construed as proposals for addition to the contract. Between merchants such terms become part of the contract unless:

(a) The offer expressly limits acceptance to the terms of the offer;

(b) They materially alter it; or

(c) Notification of objection to them has already been given or is given within a reasonable time after notice of them is received.

(3) Conduct by both parties which recognizes the existence of a contract is sufficient to establish a contract for sale although the writings of the parties do not otherwise establish a contract. In such case the terms of the particular contract consist of those terms on which the writings of the parties agree, together with any supplementary terms incorporated under any other provisions of this title.

Source: SL 1966, ch 150, § 2-207; SDCL, §§ 57-3-13 to 57-3-15.
S.D. Codified Laws § 57A-7-203 — SD Code / Title 57A / Chapter 7 / Section 57A-7-203
Liability for nonreceipt or misdescription
Status: in_force

A party to or purchaser for value in good faith of a document of title, other than a bill of lading, that relies upon the description of the goods in the document may recover from the issuer damages caused by the nonreceipt or misdescription of the goods, except to the extent that:

(1) The document conspicuously indicates that the issuer does not know whether all or part of the goods in fact were received or conform to the description, such as a case in which the description is in terms of marks or labels or kind, quantity, or condition, or the receipt or description is qualified by "contents, condition, and quality unknown", "said to contain", or words of similar import, if the indication is true; or

(2) The party or purchaser otherwise has notice of the nonreceipt or misdescription.

Source: SL 2009, ch 254, § 7-203.
S.D. Codified Laws § 57A-2-602 — SD Code / Title 57A / Chapter 2 / Section 57A-2-602
Manner and effect of rightful rejection
Status: in_force

(1) Rejection of goods must be within a reasonable time after their delivery or tender. It is ineffective unless the buyer seasonably notifies the seller.

(2) Subject to the provisions of the two following sections on rejected goods (§§ 57A-2-603 and 57A-2-604 )

(a) After rejection any exercise of ownership by the buyer with respect to any commercial unit is wrongful as against the seller; and

(b) If the buyer has before rejection taken physical possession of goods in which he does not have a security interest under the provisions of this chapter (subsection (3) of § 57A-2-711 ), he is under a duty after rejection to hold them with reasonable care at the seller's disposition for a time sufficient to permit the seller to remove them; but

(c) The buyer has no further obligations with regard to goods rightfully rejected.

(3) The seller's rights with respect to goods wrongfully rejected are governed by the provisions of this chapter on seller's remedies in general (§ 57A-2-703 ).

Source: SL 1966, ch 150, § 2-602; SDCL, §§ 57-7-2 to 57-7-4.
S.D. Codified Laws § 57A-2A-510 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-510
Installment lease contracts: rejection and default
Status: in_force

(1) Under an installment lease contract a lessee may reject any delivery that is nonconforming if the nonconformity substantially impairs the value of that delivery and cannot be cured or the nonconformity is a defect in the required documents; but if the nonconformity does not fall within subsection (2) of this section and the lessor or the supplier gives adequate assurance of its cure, the lessee must accept that delivery.

(2) Whenever nonconformity or default with respect to one or more deliveries substantially impairs the value of the installment lease contract as a whole there is a default with respect to the whole. But, the aggrieved party reinstates the installment lease contract as a whole if the aggrieved party accepts a nonconforming delivery without seasonably notifying of cancellation or brings an action with respect only to past deliveries or demands performance as to future deliveries.

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-2-401 — SD Code / Title 57A / Chapter 2 / Section 57A-2-401
Passing of title--Reservation for security--Limited application of this section
Status: in_force

Each provision of this chapter with regard to the rights, obligations and remedies of the seller, the buyer, purchasers or other third parties applies irrespective of title to the goods except where the provision refers to such title. Insofar as situations are not covered by the other provisions of this chapter and matters concerning title become material the following rules apply:

(1) Title to goods cannot pass under a contract for sale prior to their identification to the contract (§ 57A-2-501 ), and unless otherwise explicitly agreed the buyer acquires by their identification a special property as limited by this title. Any retention or reservation by the seller of the title (property) in goods shipped or delivered to the buyer is limited in effect to a reservation of a security interest. Subject to these provisions and to the provisions of the chapter on secured transactions (chapter 57A-9 ), title to goods passes from the seller to the buyer in any manner and on any conditions explicitly agreed on by the parties.

(2) Unless otherwise explicitly agreed title passes to the buyer at the time and place at which the seller completes his performance with reference to the physical delivery of the goods, despite any reservation of a security interest and even though a document of title is to be delivered at a different time or place; and in particular and despite any reservation of a security interest by the bill of lading

(a) If the contract requires or authorizes the seller to send the goods to the buyer but does not require him to deliver them at destination, title passes to the buyer at the time and place of shipment; but

(b) If the contract requires delivery at destination, title passes on tender there.

(3) Unless otherwise explicitly agreed where delivery is to be made without moving the goods,

(a) If the seller is to deliver a tangible document of title, title passes at the time when and the place where he delivers such documents and if the seller is to deliver an electronic document of title, title passes when the seller delivers the document; or

(b) If the goods are at the time of contracting already identified and no documents of title are to be delivered, title passes at the time and place of contracting.

(4) A rejection or other refusal by the buyer to receive or retain the goods, whether or not justified, or a justified revocation of acceptance revests title to the goods in the seller. Such revesting occurs by operation of law and is not a "sale."

Source: SL 1966, ch 150, § 2-401; SDCL §§ 57-5-1 to 57-5-5; SL 2009, ch 254, § 810.
S.D. Codified Laws § 57A-2-307 — SD Code / Title 57A / Chapter 2 / Section 57A-2-307
Delivery in single lot or several lots
Status: in_force

Unless otherwise agreed all goods called for by a contract for sale must be tendered in a single delivery and payment is due only on such tender but where the circumstances give either party the right to make or demand delivery in lots the price if it can be apportioned may be demanded for each lot.

Source: SL 1966, ch 150, § 2-307; SDCL, § 57-4-13.
S.D. Codified Laws § 57A-7-205 — SD Code / Title 57A / Chapter 7 / Section 57A-7-205
Title under warehouse receipt defeated in certain cases
Status: in_force

A buyer in ordinary course of business of fungible goods sold and delivered by a warehouse that is also in the business of buying and selling such goods takes the goods free of any claim under a warehouse receipt even if the receipt is negotiable and has been duly negotiated.

Source: SL 2009, ch 254, § 7-205.
S.D. Codified Laws § 57A-9-109 — SD Code / Title 57A / Chapter 9 / Section 57A-9-109
Application of chapter
Status: in_force

(a) Except as otherwise provided in subsections (c) and (d), this chapter applies to:

(1) A transaction, regardless of its form, that creates a security interest in personal property or fixtures by contract;

(2) An agricultural lien;

(3) A sale of accounts, chattel paper, payment intangibles, or promissory notes;

(4) A consignment;

(5) A security interest arising under § 57A-2-401 , 57A-2-505 , 57A-2-711(3), or 57A-2A-508(5), as provided in § 57A-9-110 ; and

(6) A security interest arising under § 57A-4-210 or 57A-5-118 .

(b) The application of this chapter to a security interest in a secured obligation is not affected by the fact that the obligation is itself secured by a transaction or interest to which this chapter does not apply.

(c) This chapter does not apply to the extent that:

(1) A statute, regulation, or treaty of the United States preempts this chapter;

(2) Another statute of this State governs the creation of a security interest created by this State or a governmental unit of this State;

(3) A statute of another state, a foreign country, or a governmental unit of another state or a foreign country, other than a statute generally applicable to security interests, expressly governs creation, perfection, priority, or enforcement of a security interest created by the state, country, or governmental unit; or

(4) The rights of a transferee beneficiary or nominated person under a letter of credit are independent and superior under § 57A-5-114 .

(d) This chapter does not apply to:

(1) A landlord's lien, other than an agricultural lien;

(2) A lien, other than an agricultural lien, given by statute or other rule of law for services or materials, but § 57A-9-333 applies with respect to priority of the lien;

(3) An assignment of a claim for wages, salary, or other compensation of an employee;

(4) A sale of accounts, chattel paper, payment intangibles, or promissory notes as part of a sale of the business out of which they arose;

(5) An assignment of accounts, chattel paper, payment intangibles, or promissory notes which is for the purpose of collection only;

(6) An assignment of a right to payment under a contract to an assignee that is also obligated to perform under the contract;

(7) An assignment of a single account, payment intangible, or promissory note to an assignee in full or partial satisfaction of a preexisting indebtedness;

(8) A transfer of an interest in or an assignment of a claim under a policy of insurance, other than an assignment by or to a health-care provider of a health-care-insurance receivable and any subsequent assignment of the right to payment, but §§ 57A-9-315 and 57A-9-322 apply with respect to proceeds and priorities in proceeds;

(9) An assignment of a right represented by a judgment, other than a judgment taken on a right to payment that was collateral;

(10) A right of recoupment or set-off, but:

(A) Section 57A-9-340 applies with respect to the effectiveness of rights of recoupment or set-off against deposit accounts; and

(B) Section 57A-9-404 applies with respect to defenses or claims of an account debtor;

(11) The creation or transfer of an interest in or lien on real property, including a lease or rents thereunder, except to the extent that provision is made for:

(A) Liens on real property in §§ 57A-9-203 and 57A-9-308 ;

(B) Fixtures in § 57A-9-334 ;

(C) Fixture filings in §§ 57A-9-501 , 57A-9-502 , 57A-9-512 , 57A-9-516 , and 57A-9-519 ; and

(D) Security agreements covering personal and real property in § 57A-9-604 ;

(12) An assignment of a claim arising in tort, other than a commercial tort claim, but §§ 57A-9-315 and 57A-9-322 apply with respect to proceeds and priorities in proceeds;

(13) A transfer or security interest made or created by a state or any governmental unit;

(14) An assignment of a deposit account in a consumer transaction, but §§ 57A-9-315 and 57A-9-322 apply with respect to proceeds and priorities in proceeds;

(15) The pledging or segregating of collateral for public deposits as authorized by § 51A-10-9 , chapter 52-5 , and chapter 4-6A ;

(16) An assignment of a claim or right to receive compensation for injuries or sickness as described in 26 U.S.C. § 104(a)(1) or (2), as amended to January 1, 2001; or

(17) An assignment of a claim or right to receive benefits under a special needs trust as described in 42 U.S.C. § 1396p(d)(4), as amended to January 1, 2001.

Source: SL 2000, ch 231; SL 2001, ch 261, § 2.
S.D. Codified Laws § 57A-2A-310 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-310
Lessor's and lessee's rights when goods become accessions
Status: in_force

(1) Goods are "accessions" when they are installed in or affixed to other goods.

(2) The interest of a lessor or a lessee under a lease contract entered into before the goods became accessions is superior to all interests in the whole except as stated in subsection (4) of this section.

(3) The interest of a lessor or a lessee under a lease contract entered into at the time or after the goods became accessions is superior to all subsequently acquired interests in the whole except as stated in subsection (4) of this section but is subordinate to interests in the whole existing at the time the lease contract was made unless the holders of such interests in the whole have in writing consented to the lease or disclaimed an interest in the goods as part of the whole.

(4) The interest of a lessor or a lessee under a lease contract described in subsection (2) or subsection (3) of this section is subordinate to the interest of

(a) A buyer in the ordinary course of business or a lessee in the ordinary course of business of any interest in the whole acquired after the goods became accessions; or

(b) A creditor with a security interest in the whole perfected before the lease contract was made to the extent that the creditor makes subsequent advances without knowledge of the lease contract.

(5) When under subsections (2) or (3) and (4) of this section a lessor or a lessee of accessions holds an interest that is superior to all interests in the whole, the lessor or the lessee may (a) on default, expiration, termination, or cancellation of the lease contract by the other party but subject to the provisions of the lease contract and this chapter, or (b) if necessary to enforce his other rights and remedies under this chapter, remove the goods from the whole, free and clear of all interests in the whole, but he must reimburse any holder of an interest in the whole who is not the lessee and who has not otherwise agreed for the cost of repair of any physical injury but not for any diminution in value of the whole caused by the absence of the goods removed or by any necessity for replacing them. A person entitled to reimbursement may refuse permission to remove until the party seeking removal gives adequate security for the performance of this obligation.

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-3-101 — SD Code / Title 57A / Chapter 3 / Section 57A-3-101
Short title
Status: in_force

This chapter may be cited as Uniform Commercial Code--Negotiable Instruments.

Source: SL 1994, ch 367, § 3-101.
S.D. Codified Laws § 57A-8-108 — SD Code / Title 57A / Chapter 8 / Section 57A-8-108
Warranties in direct holding
Status: in_force

(a) A person who transfers a certificated security to a purchaser for value warrants to the purchaser, and an indorser, if the transfer is by indorsement, warrants to any subsequent purchaser, that:

(1) The certificate is genuine and has not been materially altered;

(2) The transferor or indorser does not know of any fact that might impair the validity of the security;

(3) There is no adverse claim to the security;

(4) The transfer does not violate any restriction on transfer;

(5) If the transfer is by indorsement, the indorsement is made by an appropriate person, or if the indorsement is by an agent, the agent has actual authority to act on behalf of the appropriate person; and

(6) The transfer is otherwise effective and rightful.

(b) A person who originates an instruction for registration of transfer of an uncertificated security to a purchaser for value warrants to the purchaser that:

(1) The instruction is made by an appropriate person, or if the instruction is by an agent, the agent has actual authority to act on behalf of the appropriate person;

(2) The security is valid;

(3) There is no adverse claim to the security; and

(4) At the time the instruction is presented to the issuer:

(i) The purchaser will be entitled to the registration of transfer;

(ii) The transfer will be registered by the issuer free from all liens, security interests, restrictions, and claims other than those specified in the instruction;

(iii) The transfer will not violate any restriction on transfer; and

(iv) The requested transfer will otherwise be effective and rightful.

(c) A person who transfers an uncertificated security to a purchaser for value and does not originate an instruction in connection with the transfer warrants that:

(1) The uncertificated security is valid;

(2) There is no adverse claim to the security;

(3) The transfer does not violate any restriction on transfer; and

(4) The transfer is otherwise effective and rightful.

(d) A person who indorses a security certificate warrants to the issuer that:

(1) There is no adverse claim to the security; and

(2) The indorsement is effective.

(e) A person who originates an instruction for registration of transfer of an uncertificated security warrants to the issuer that:

(1) The instruction is effective; and

(2) At the time the instruction is presented to the issuer the purchaser will be entitled to the registration of transfer.

(f) A person who presents a certificated security for registration of transfer or for payment or exchange warrants to the issuer that the person is entitled to the registration, payment, or exchange, but a purchaser for value and without notice of adverse claims to whom transfer is registered warrants only that the person has no knowledge of any unauthorized signature in a necessary indorsement.

(g) If a person acts as agent of another in delivering a certificated security to a purchaser, the identity of the principal was known to the person to whom the certificate was delivered, and the certificate delivered by the agent was received by the agent from the principal or received by the agent from another person at the direction of the principal, the person delivering the security certificate warrants only that the delivering person has authority to act for the principal and does not know of any adverse claim to the certificated security.

(h) A secured party who redelivers a security certificate received, or after payment and on order of the debtor delivers the security certificate to another person, makes only the warranties of an agent under subsection (g).

(i) Except as otherwise provided in subsection (g), a broker acting for a customer makes to the issuer and a purchaser the warranties provided in subsections (a) through (f). A broker that delivers a security certificate to its customer, or causes its customer to be registered as the owner of an uncertificated security, makes to the customer the warranties provided in subsection (a) or (b), and has the rights and privileges of a purchaser under this section. The warranties of and in favor of the broker acting as an agent are in addition to applicable warranties given by and in favor of the customer.

Source: SL 1998, ch 284, § 1.
S.D. Codified Laws § 57A-3-108 — SD Code / Title 57A / Chapter 3 / Section 57A-3-108
Payable on demand or at definite time
Status: in_force

(a) A promise or order is "payable on demand" if it (i) states that it is payable on demand or at sight, or otherwise indicates that it is payable at the will of the holder, or (ii) does not state any time of payment.

(b) A promise or order is "payable at a definite time" if it is payable on elapse of a definite period of time after sight or acceptance or at a fixed date or dates or at a time or times readily ascertainable at the time the promise or order is issued, subject to rights of (i) prepayment, (ii) acceleration, (iii) extension at the option of the holder, or (iv) extension to a further definite time at the option of the maker or acceptor or automatically upon or after a specified act or event.

(c) If an instrument, payable at a fixed date, is also payable upon demand made before the fixed date, the instrument is payable on demand until the fixed date and, if demand for payment is not made before that date, becomes payable at a definite time on the fixed date.

Source: SL 1994, ch 367, § 3-108.
S.D. Codified Laws § 57A-3A-101 — SD Code / Title 57A / Chapter 3A / Section 57A-3A-101
Definition of terms
Status: in_force

Terms as used in this chapter, unless the context otherwise requires mean:

(1) "Consumer goods or services," all goods and services purchased at retail and bought for use primarily for personal, family or household purposes.

(2) "Retail seller," as "Retailer" is defined in § 10-45-1 .

(3) "Retail buyer," any person purchasing consumer goods or services from a retail seller.

(4) "Person," as that term is defined by § 10-45-1 .

Source: SL 1973, ch 295, § 1; SDCL Supp, § 57-10A-1.
S.D. Codified Laws § 57A-9-501.1 — SD Code / Title 57A / Chapter 9 / Section 57A-9-501.1
Validation of noncomplying statements
Status: in_force

All statements to continue, release, assign, amend or terminate any financing statements filed subsequent to December 31, 1979, and prior to July 1, 1980, notwithstanding any noncompliance with § 57A-9-401.1 as amended, are hereby cured, legalized and validated as fully as if such filings had been made in full compliance with § 57A-9-401.1 .

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-2-612 — SD Code / Title 57A / Chapter 2 / Section 57A-2-612
"Installment contract"--Breach
Status: in_force

(1) An "installment contract" is one which requires or authorizes the delivery of goods in separate lots to be separately accepted, even though the contract contains a clause "each delivery is a separate contract" or its equivalent.

(2) The buyer may reject any installment which is nonconforming if the nonconformity substantially impairs the value of that installment and cannot be cured or if the nonconformity is a defect in the required documents; but if the nonconformity does not fall within subsection (3) and the seller gives adequate assurance of its cure the buyer must accept that installment.

(3) Whenever nonconformity or default with respect to one or more installments substantially impairs the value of the whole contract there is a breach of the whole. But the aggrieved party reinstates the contract if he accepts a nonconforming installment without seasonably notifying of cancellation or if he brings an action with respect only to past installments or demands performance as to future installments.

Source: SL 1966, ch 150, § 2-612; SDCL, §§ 57-7-31 to 57-7-33.
S.D. Codified Laws § 57A-9-105.1 — SD Code / Title 57A / Chapter 9 / Section 57A-9-105.1
Control of electronic money
Status: in_force

(a) A person has control of electronic money if:

(1) The electronic money, a record attached to or logically associated with the electronic money, or a system in which the electronic money is recorded gives the person:

(A) Power to avail itself of substantially all the benefit from the electronic money; and

(B) Exclusive power, subject to subsection (b), to:

(i) Prevent others from availing themselves of substantially all the benefit from the electronic money; and

(ii) Transfer control of the electronic money to another person or cause another person to obtain control of other electronic money as a result of the transfer of the electronic money; and

(2) The electronic money, a record attached to or logically associated with the electronic money, or a system in which the electronic money is recorded, enables the person readily to identify itself in any way, including by name, identifying number, cryptographic key, office, or account number, as having the powers under paragraph (1).

(b) Subject to subsection (c), a power is exclusive under subsection (a)(1)(B)(i) and (ii) even if:

(1) The electronic money, a record attached to or logically associated with the electronic money, or a system in which the electronic money is recorded, limits the use of the electronic money or has a protocol programmed to cause a change, including a transfer or loss of control; or

(2) The power is shared with another person.

(c) A power of a person is not shared with another person under subsection (b)(2) and the person's power is not exclusive if:

(1) The person can exercise the power only if the power also is exercised by the other person; and

(2) The other person:

(A) Can exercise the power without exercise of the power by the person; or

(B) Is the transferor to the person of an interest in the electronic money.

(d) If a person has the powers specified in subsection (a)(1)(B)(i) and (ii), the powers are presumed to be exclusive.

(e) A person has control of electronic money if another person, other than the transferor to the person of an interest in the electronic money:

(1) Has control of the electronic money and acknowledges that it has control on behalf of the person; or

(2) Obtains control of the electronic money after having acknowledged that it will obtain control of the electronic money on behalf of the person.

Source: SL 2024, ch 198, § 46.
S.D. Codified Laws § 57A-9-316 — SD Code / Title 57A / Chapter 9 / Section 57A-9-316
Continued perfection of security interest following change in governing law
Status: in_force

(a) A security interest perfected pursuant to the law of the jurisdiction designated in § 57A-9-301 (1), 57A-9-305 (c), 57A-9-306.1 , or 57A-9-306.2 remains perfected until the earliest of:

(1) The time perfection would have ceased under the law of that jurisdiction;

(2) The expiration of four months after a change of the debtor's location to another jurisdiction; or

(3) The expiration of one year after a transfer of collateral to a person that thereby becomes a debtor and is located in another jurisdiction.

(b) If a security interest described in subsection (a) becomes perfected under the law of the other jurisdiction before the earliest time or event described in that subsection, it remains perfected thereafter. If the security interest does not become perfected under the law of the other jurisdiction before the earliest time or event, it becomes unperfected and is deemed never to have been perfected as against a purchaser of the collateral for value.

(c) A possessory security interest in collateral, other than goods covered by a certificate of title and as-extracted collateral consisting of goods, remains continuously perfected if:

(1) The collateral is located in one jurisdiction and subject to a security interest perfected under the law of that jurisdiction;

(2) Thereafter the collateral is brought into another jurisdiction; and

(3) Upon entry into the other jurisdiction, the security interest is perfected under the law of the other jurisdiction.

(d) Except as otherwise provided in subsection (e), a security interest in goods covered by a certificate of title which is perfected by any method under the law of another jurisdiction when the goods become covered by a certificate of title from this State remains perfected until the security interest would have become unperfected under the law of the other jurisdiction had the goods not become so covered.

(e) A security interest described in subsection (d) becomes unperfected as against a purchaser of the goods for value and is deemed never to have been perfected as against a purchaser of the goods for value if the applicable requirements for perfection under § 57A-9-311 (b) or 57A-9-313 are not satisfied before the earlier of:

(1) The time the security interest would have become unperfected under the law of the other jurisdiction had the goods not become covered by a certificate of title from this state; or

(2) The expiration of four months after the goods had become so covered.

(f) A security interest in chattel paper, controllable accounts, controllable electronic records, controllable payment intangibles, deposit accounts, letter-of-credit rights, or investment property which is perfected under the law of the chattel paper's jurisdiction, the controllable electronic record's jurisdiction, the bank's jurisdiction, the issuer's jurisdiction, a nominated person's jurisdiction, the securities intermediary's jurisdiction, or the commodity intermediary's jurisdiction, as applicable, remains perfected until the earlier of:

(1) The time the security interest would have become unperfected under the law of that jurisdiction; or

(2) The expiration of four months after a change of the applicable jurisdiction to another jurisdiction.

(g) If a security interest described in subsection (f) becomes perfected under the law of the other jurisdiction before the earlier of the time or the end of the period described in that subsection, it remains perfected thereafter. If the security interest does not become perfected under the law of the other jurisdiction before the earlier of that time or the end of that period, it becomes unperfected and is deemed never to have been perfected as against a purchaser of the collateral for value.

(h) The following rules apply to collateral to which a security interest attaches within four months after the debtor changes its location to another jurisdiction:

(1) A financing statement filed before the change pursuant to the law of the jurisdiction designated in § 57A-9-301 (1) or 57A-9-305 (c) is effective to perfect a security interest in the collateral if the financing statement would have been effective to perfect a security interest in the collateral had the debtor not changed its location;

(2) If a security interest perfected by a financing statement that is effective under paragraph (1) becomes perfected under the law of the other jurisdiction before the earlier of the time the financing statement would have become ineffective under the law of the jurisdiction designated in § 57A-9-301 (1) or 57A-9-305 (c) or the expiration of the four-month period, it remains perfected thereafter. If the security interest does not become perfected under the law of the other jurisdiction before the earlier time or event, it becomes unperfected and is deemed never to have been perfected as against a purchaser of the collateral for value.

(i) If a financing statement naming an original debtor is filed pursuant to the law of the jurisdiction designated in § 57A-9-301 (1) or 57A-9-305 (c) and the new debtor is located in another jurisdiction, the following rules apply:

(1) The financing statement is effective to perfect a security interest in collateral in which the new debtor has or acquires rights before or within four months after the new debtor becomes bound under § 57A-9-203 (d), if the financing statement would have been effective to perfect a security interest in the collateral if the collateral been acquired by the original debtor.

(2) A security interest perfected by the financing statement and which becomes perfected under the law of the other jurisdiction before the earlier of the expiration of the four-month period or the time the financing statement would have become ineffective under the law of the jurisdiction designated in § 57A-9-301 (1) or 57A-9-305 (c) remains perfected thereafter. A security interest that is perfected by the financing statement but which does not become perfected under the law of the other jurisdiction before the earlier time or event becomes unperfected and is deemed never to have been perfected as against a purchaser of the collateral for value.

Source: SL 2000, ch 231; SL 2012, ch 238, § 5, eff. July 1, 2013; SL 2024, ch 198, § 65.
S.D. Codified Laws § 57A-3-206 — SD Code / Title 57A / Chapter 3 / Section 57A-3-206
Restrictive indorsement
Status: in_force

(a) An indorsement limiting payment to a particular person or otherwise prohibiting further transfer or negotiation of the instrument is not effective to prevent further transfer or negotiation of the instrument.

(b) An indorsement stating a condition to the right of the indorsee to receive payment does not affect the right of the indorsee to enforce the instrument. A person paying the instrument or taking it for value or collection may disregard the condition, and the rights and liabilities of that person are not affected by whether the condition has been fulfilled.

(c) If an instrument bears an indorsement (i) described in § 57A-4-201(b), or (ii) in blank or to a particular bank using the words "for deposit," "for collection," or other words indicating a purpose of having the instrument collected by a bank for the indorser or for a particular account, the following rules apply:

(1) A person, other than a bank, who purchases the instrument when so indorsed converts the instrument unless the amount paid for the instrument is received by the indorser or applied consistently with the indorsement.

(2) A depositary bank that purchases the instrument or takes it for collection when so indorsed converts the instrument unless the amount paid by the bank with respect to the instrument is received by the indorser or applied consistently with the indorsement.

(3) A payor bank that is also the depositary bank or that takes the instrument for immediate payment over the counter from a person other than a collecting bank converts the instrument unless the proceeds of the instrument are received by the indorser or applied consistently with the indorsement.

(4) Except as otherwise provided in paragraph (3), a payor bank or intermediary bank may disregard the indorsement and is not liable if the proceeds of the instrument are not received by the indorser or applied consistently with the indorsement.

(d) Except for an indorsement covered by subsection (c), if an instrument bears an indorsement using words to the effect that payment is to be made to the indorsee as agent, trustee, or other fiduciary for the benefit of the indorser or another person, the following rules apply:

(1) Unless there is notice of breach of fiduciary duty as provided in § 57A-3-307 , a person who purchases the instrument from the indorsee or takes the instrument from the indorsee for collection or payment may pay the proceeds of payment or the value given for the instrument to the indorsee without regard to whether the indorsee violates a fiduciary duty to the indorser.

(2) A subsequent transferee of the instrument or person who pays the instrument is neither given notice nor otherwise affected by the restriction in the indorsement unless the transferee or payor knows that the fiduciary dealt with the instrument or its proceeds in breach of fiduciary duty.

(e) The presence on an instrument of an indorsement to which this section applies does not prevent a purchaser of the instrument from becoming a holder in due course of the instrument unless the purchaser is a converter under subsection (c) or has notice or knowledge of breach of fiduciary duty as stated in subsection (d).

(f) In an action to enforce the obligation of a party to pay the instrument, the obligor has a defense if payment would violate an indorsement to which this section applies and the payment is not permitted by this section.

Source: SL 1994, ch 367, § 3-206.
S.D. Codified Laws § 57A-2A-525 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-525
Lessor's right to possession of goods
Status: in_force

(1) If a lessor discovers the lessee to be insolvent, the lessor may refuse to deliver the goods.

(2) The lessor has on default by the lessee under the lease contract the right to take possession of the goods. If the lease contract so provides, the lessor may require the lessee to assemble the goods and make them available to the lessor at a place to be designated by the lessor which is reasonably convenient to both parties. Without removal, the lessor may render unusable any goods employed in trade or business, and may dispose of goods on the lessee's premises (§ 57A-2A-527 ).

(3) The lessor may proceed under subsection (2) of this section without judicial process if that can be done without breach of the peace or the lessor may proceed by action.

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-4-302 — SD Code / Title 57A / Chapter 4 / Section 57A-4-302
Payor bank's responsibility for late return of item
Status: in_force

(a) If an item is presented to and received by a payor bank, the bank is accountable for the amount of:

(1) A demand item, other than a documentary draft, whether properly payable or not, if the bank, in any case in which it is not also the depositary bank, retains the item beyond midnight of the banking day of receipt without settling for it or, whether or not it is also the depositary bank, does not pay or return the item or send notice of dishonor until after its midnight deadline; or

(2) Any other properly payable item unless, within the time allowed for acceptance or payment of that item, the bank either accepts or pays the item or returns it and accompanying documents.

(b) The liability of a payor bank to pay an item pursuant to subsection (a) is subject to defenses based on breach of a presentment warranty (§ 57A-4-208 ) or proof that the person seeking enforcement of the liability presented or transferred the item for the purpose of defrauding the payor bank.

Source: SL 1994, ch 368, § 4-302.
S.D. Codified Laws § 57A-2A-302 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-302
Title to and possession of goods
Status: in_force

Except as otherwise provided in this chapter, each provision of this chapter applies whether the lessor or a third party has title to the goods, and whether the lessor, the lessee, or a third party has possession of the goods, notwithstanding any statute or rule of law that possession or the absence of possession is fraudulent.

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-1-303 — SD Code / Title 57A / Chapter 1 / Section 57A-1-303
Course of performance, course of dealing, and usage of trade
Status: in_force

(a) A "course of performance" is a sequence of conduct between the parties to a particular transaction that exists if:

(1) The agreement of the parties with respect to the transaction involves repeated occasions for performance by a party; and

(2) The other party, with knowledge of the nature of the performance and opportunity for objection to it, accepts the performance or acquiesces in it without objection.

(b) A "course of dealing" is a sequence of conduct concerning previous transactions between the parties to a particular transaction that is fairly to be regarded as establishing a common basis of understanding for interpreting their expressions and other conduct.

(c) A "usage of trade" is any practice or method of dealing having such regularity of observance in a place, vocation, or trade as to justify an expectation that it will be observed with respect to the transaction in question. The existence and scope of such a usage must be proved as facts. If it is established that such a usage is embodied in a trade code or similar record, the interpretation of the record is a question of law.

(d) A course of performance or course of dealing between the parties or usage of trade in the vocation or trade in which they are engaged or of which they are or should be aware is relevant in ascertaining the meaning of the parties' agreement, may give particular meaning to specific terms of the agreement, and may supplement or qualify the terms of the agreement. A usage of trade applicable in the place in which part of the performance under the agreement is to occur may be so utilized as to that part of the performance.

(e) Except as otherwise provided in subsection (f), the express terms of an agreement and any applicable course of performance, course of dealing, or usage of trade must be construed whenever reasonable as consistent with each other. If such a construction is unreasonable:

(1) Express terms prevail over course of performance, course of dealing, and usage of trade;

(2) Course of performance prevails over course of dealing and usage of trade; and

(3) Course of dealing prevails over usage of trade.

(f) Subject to § 57A-2-209 , a course of performance is relevant to show a waiver or modification of any term inconsistent with the course of performance.

(g) Evidence of a relevant usage of trade offered by one party is not admissible unless that party has given the other party notice that the court finds sufficient to prevent unfair surprise to the other party.

Source: SL 2008, ch 259, § 17.
S.D. Codified Laws § 57A-3-110 — SD Code / Title 57A / Chapter 3 / Section 57A-3-110
Identification of person to whom instrument is payable
Status: in_force

(a) The person to whom an instrument is initially payable is determined by the intent of the person, whether or not authorized, signing as, or in the name or behalf of, the issuer of the instrument. The instrument is payable to the person intended by the signer even if that person is identified in the instrument by a name or other identification that is not that of the intended person. If more than one person signs in the name or behalf of the issuer of an instrument and all the signers do not intend the same person as payee, the instrument is payable to any person intended by one or more of the signers.

(b) If the signature of the issuer of an instrument is made by automated means, such as a check - writing machine, the payee of the instrument is determined by the intent of the person who supplied the name or identification of the payee, whether or not authorized to do so.

(c) A person to whom an instrument is payable may be identified in any way, including by name, identifying number, office, or account number. For the purpose of determining the holder of an instrument, the following rules apply:

(1) If an instrument is payable to an account and the account is identified only by number, the instrument is payable to the person to whom the account is payable. If an instrument is payable to an account identified by number and by the name of a person, the instrument is payable to the named person, whether or not that person is the owner of the account identified by number.

(2) If an instrument is payable to:

(i) A trust, an estate, or a person described as trustee or representative of a trust or estate, the instrument is payable to the trustee, the representative, or a successor of either, whether or not the beneficiary or estate is also named;

(ii) A person described as agent or similar representative of a named or identified person, the instrument is payable to the represented person, the representative, or a successor of the representative;

(iii) A fund or organization that is not a legal entity, the instrument is payable to a representative of the members of the fund or organization; or

(iv) An office or to a person described as holding an office, the instrument is payable to the named person, the incumbent of the office, or a successor to the incumbent.

(d) If an instrument is payable to two or more persons alternatively, it is payable to any of them and may be negotiated, discharged, or enforced by any or all of them in possession of the instrument. If an instrument is payable to two or more persons not alternatively, it is payable to all of them and may be negotiated, discharged, or enforced only by all of them. If an instrument payable to two or more persons is ambiguous as to whether it is payable to the persons alternatively, the instrument is payable to the persons alternatively. For the purposes of this subsection, the term, instrument, includes a writing that would otherwise qualify as a certificate of deposit but for the fact that the writing contains a limitation on transfer.

Source: SL 1994, ch 367, § 3-110; SL 1997, ch 281, § 2.
S.D. Codified Laws § 57A-12-103 — SD Code / Title 57A / Chapter 12 / Section 57A-12-103
Relation to chapter57A-9and consumer laws
Status: in_force

(a) If there is a conflict between this chapter and chapter 57A-9 , chapter 57A-9 governs.

(b) A transaction subject to this chapter is subject to any applicable rule of law that establishes a different rule for consumers and to (i) title 51A and title 54 and (ii) chapter 37-23 .

Source: SL 2024, ch 198, § 95.
S.D. Codified Laws § 57A-2A-516 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-516
Effect of acceptance of goods--Notice of default--Burden of establishing default after acceptance--Notice of claim or litigation to person answerable over
Status: in_force

(1) A lessee must pay rent for any goods accepted in accordance with the lease contract, with due allowance for goods rightfully rejected or not delivered;

(2) A lessee's acceptance of goods precludes rejection of the goods accepted. In the case of a finance lease, other than a consumer lease in which the supplier assisted in the preparation of the lease contract or participated in negotiating the terms of the lease contract with the lessor, if made with knowledge of a nonconformity, acceptance cannot be revoked because of it. In any other case, if made with knowledge of a nonconformity, acceptance cannot be revoked because of it unless the acceptance was on the reasonable assumption that the nonconformity would be seasonably cured. Acceptance does not of itself impair any other remedy provided by this chapter or the lease agreement for nonconformity.

(3) If a tender has been accepted:

(a) Within a reasonable time after the lessee discovers or should have discovered any default, (i) the lessee shall notify the lessor, or be barred from any remedy against the lessor, and, in addition, (ii) in the case of a finance lease, the lessee shall notify the supplier or be barred from any remedy against the supplier;

(b) Within a reasonable time after the lessee receives notice of litigation for infringement or the like (§ 57A-2A-211 ) the lessee shall notify the lessor or be barred from any remedy over for liability established by the litigation; and

(c) The burden is on the lessee to establish any default.

(4) If a lessee is sued for breach of a warranty or other obligation for which a lessor or a supplier is answerable over:

(a) The lessee may give the lessor or the supplier written notice of the litigation. If the notice states that the lessor or the supplier may come in and defend and that if the lessor or the supplier does not do so he will be bound in any action against him by the lessee by any determination of fact common to the two litigations, then unless the lessor or the supplier after seasonable receipt of the notice does come in and defend he is so bound.

(b) The lessor or the supplier may demand in writing that the lessee turn over control of the litigation including settlement if the claim is one for infringement or the like (§ 57A-2A-211 ) or else be barred from any remedy over. If the demand states that the lessor or the supplier agrees to bear all expense and to satisfy any adverse judgment, then unless the lessee after seasonable receipt of the demand does turn over control the lessee is so barred.

(5) The provisions of subsections (3) and (4) of this section apply to any obligation of a lessee to hold the lessor or the supplier harmless against infringement or the like (§ 57A-2A-211 ).

(6) Subsection (3) shall not apply to a consumer lease.

Source: SL 1989, ch 419, § 1; SL 1990, ch 390, § 19.
S.D. Codified Laws § 57A-3-114 — SD Code / Title 57A / Chapter 3 / Section 57A-3-114
Contradictory terms of instrument
Status: in_force

If an instrument contains contradictory terms, typewritten terms prevail over printed terms, handwritten terms prevail over both, and words prevail over numbers.

Source: SL 1994, ch 367, § 3-114.
S.D. Codified Laws § 57A-9-619 — SD Code / Title 57A / Chapter 9 / Section 57A-9-619
Transfer of record or legal title
Status: in_force

(a) In this section, "transfer statement" means a record signed by a secured party stating:

(1) That the debtor has defaulted in connection with an obligation secured by specified collateral;

(2) That the secured party has exercised its post - default remedies with respect to the collateral;

(3) That, by reason of the exercise, a transferee has acquired the rights of the debtor in the collateral; and

(4) The name and mailing address of the secured party, debtor, and transferee.

(b) A transfer statement entitles the transferee to the transfer of record of all rights of the debtor in the collateral specified in the statement in any official filing, recording, registration, or certificate - of - title system covering the collateral. If a transfer statement is presented with the applicable fee and request form to the official or office responsible for maintaining the system, the official or office shall:

(1) Accept the transfer statement;

(2) Promptly amend its records to reflect the transfer; and

(3) If applicable, issue a new appropriate certificate of title in the name of the transferee.

(c) A transfer of the record or legal title to collateral to a secured party under subsection (b) or otherwise is not of itself a disposition of collateral under this chapter and does not of itself relieve the secured party of its duties under this chapter.

Source: SL 2000, ch 231; SL 2024, ch 198, § 88.
S.D. Codified Laws § 57A-8-114 — SD Code / Title 57A / Chapter 8 / Section 57A-8-114
Evidentiary rules concerning certificated securities
Status: in_force

The following rules apply in an action on a certificated security against the issuer:

(1) Unless specifically denied in the pleadings, each signature on a security certificate or in a necessary indorsement is admitted.

(2) If the effectiveness of a signature is put in issue, the burden of establishing effectiveness is on the party claiming under the signature, but the signature is presumed to be genuine or authorized.

(3) If signatures on a security certificate are admitted or established, production of the certificate entitles a holder to recover on it unless the defendant establishes a defense or a defect going to the validity of the security.

(4) If it is shown that a defense or defect exists, the plaintiff has the burden of establishing that the plaintiff or some person under whom the plaintiff claims is a person against whom the defense or defect cannot be asserted.

Source: SL 1998, ch 284, § 1.
S.D. Codified Laws § 57A-2-104 — SD Code / Title 57A / Chapter 2 / Section 57A-2-104
Definitions--"Merchant"--"Between merchants"--"Financing agency"
Status: in_force

(1) "Merchant" means a person who deals in goods of the kind or otherwise by his occupation holds himself out as having knowledge or skill peculiar to the practices or goods involved in the transaction or to whom such knowledge or skill may be attributed by his employment of an agent or broker or other intermediary who by his occupation holds himself out as having such knowledge or skill.

(2) "Financing agency" means a bank, finance company or other person who in the ordinary course of business makes advances against goods or documents of title or who by arrangement with either the seller or the buyer intervenes in ordinary course to make or collect payment due or claimed under the contract for sale, as by purchasing or paying the seller's draft or making advances against it or by merely taking it for collection whether or not documents of title accompany or are associated with the draft. "Financing agency" includes also a bank or other person who similarly intervenes between persons who are in the position of seller and buyer in respect to the goods (§ 57A-2-707 ).

(3) "Between merchants" means in any transaction with respect to which both parties are chargeable with the knowledge or skill of merchants.

Source: SL 1966, ch 150, § 2-104; SDCL §§ 57-2-7 to 57-2-9; SL 2009, ch 254, § 807.
S.D. Codified Laws § 57A-3-307 — SD Code / Title 57A / Chapter 3 / Section 57A-3-307
Notice of breach of fiduciary duty
Status: in_force

(a) In this section:

(1) "Fiduciary" means an agent, trustee, partner, corporate officer or director, or other representative owing a fiduciary duty with respect to an instrument.

(2) "Represented person" means the principal, beneficiary, partnership, corporation, or other person to whom the duty stated in paragraph (1) is owed.

(b) If (i) an instrument is taken from a fiduciary for payment or collection or for value, (ii) the taker has knowledge of the fiduciary status of the fiduciary, and (iii) the represented person makes a claim to the instrument or its proceeds on the basis that the transaction of the fiduciary is a breach of fiduciary duty, the following rules apply:

(1) Notice of breach of fiduciary duty by the fiduciary is notice of the claim of the represented person.

(2) In the case of an instrument payable to the represented person or the fiduciary as such, the taker has notice of the breach of fiduciary duty if the instrument is (i) taken in payment of or as security for a debt known by the taker to be the personal debt of the fiduciary, (ii) taken in a transaction known by the taker to be for the personal benefit of the fiduciary, or (iii) deposited to an account other than an account of the fiduciary, as such, or an account of the represented person.

(3) If an instrument is issued by the represented person or the fiduciary as such, and made payable to the fiduciary personally, the taker does not have notice of the breach of fiduciary duty unless the taker knows of the breach of fiduciary duty.

(4) If an instrument is issued by the represented person or the fiduciary as such, to the taker as payee, the taker has notice of the breach of fiduciary duty if the instrument is (i) taken in payment of or as security for a debt known by the taker to be the personal debt of the fiduciary, (ii) taken in a transaction known by the taker to be for the personal benefit of the fiduciary, or (iii) deposited to an account other than an account of the fiduciary, as such, or an account of the represented person.

Source: SL 1994, ch 367, § 3-307.
S.D. Codified Laws § 57A-9-709 — SD Code / Title 57A / Chapter 9 / Section 57A-9-709
Determination of priority of conflicting claims to collateral--Dating priority of security interest
Status: in_force

(a) This chapter determines the priority of conflicting claims to collateral. However, if the relative priorities of the claims were established before July 1, 2001, former chapter 57A-9 determines priority.

(b) For purposes of § 57A-9-322(a), the priority of a security interest that becomes enforceable under § 57A-9-203 of this chapter dates from July 1, 2001, if the security interest is perfected under this chapter by the filing of a financing statement before July 1, 2001, which would not have been effective to perfect the security interest under former chapter 57A-9 . This subsection does not apply to conflicting security interests each of which is perfected by the filing of such a financing statement.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-2A-213 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-213
Implied warranty of fitness for particular purpose
Status: in_force

Except in a finance lease, if the lessor at the time the lease contract is made has reason to know of any particular purpose for which the goods are required and that the lessee is relying on the lessor's skill or judgment to select or furnish suitable goods, there is in the lease contract an implied warranty that the goods will be fit for that purpose.

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-8-210 — SD Code / Title 57A / Chapter 8 / Section 57A-8-210
Overissue
Status: in_force

(a) In this section, "overissue" means the issue of securities in excess of the amount the issuer has corporate power to issue, but an overissue does not occur if appropriate action has cured the overissue.

(b) Except as otherwise provided in subsections (c) and (d), the provisions of this chapter which validate a security or compel its issue or reissue do not apply to the extent that validation, issue, or reissue would result in overissue.

(c) If an identical security not constituting an overissue is reasonably available for purchase, a person entitled to issue or validation may compel the issuer to purchase the security and deliver it if certificated or register its transfer if uncertificated, against surrender of any security certificate the person holds.

(d) If a security is not reasonably available for purchase, a person entitled to issue or validation may recover from the issuer the price the person or the last purchaser for value paid for it with interest from the date of the person's demand.

Source: SL 1998, ch 284, § 1.
S.D. Codified Laws § 57A-3-302 — SD Code / Title 57A / Chapter 3 / Section 57A-3-302
Holder in due course
Status: in_force

(a) Subject to subsection (c) and § 57A-3-106(d), "holder in due course" means the holder of an instrument if:

(1) The instrument when issued or negotiated to the holder does not bear such apparent evidence of forgery or alteration or is not otherwise so irregular or incomplete as to call into question its authenticity; and

(2) The holder took the instrument (i) for value, (ii) in good faith, (iii) without notice that the instrument is overdue or has been dishonored or that there is an uncured default with respect to payment of another instrument issued as part of the same series, (iv) without notice that the instrument contains an unauthorized signature or has been altered, (v) without notice of any claim to the instrument described in § 57A-3-306 , and (vi) without notice that any party has a defense or claim in recoupment described in § 57A-3-305(a).

(b) Notice of discharge of a party, other than discharge in an insolvency proceeding, is not notice of a defense under subsection (a), but discharge is effective against a person who became a holder in due course with notice of the discharge. Public filing or recording of a document does not of itself constitute notice of a defense, claim in recoupment, or claim to the instrument.

(c) Except to the extent a transferor or predecessor in interest has rights as a holder in due course, a person does not acquire rights of a holder in due course of an instrument taken (i) by legal process or by purchase in an execution, bankruptcy, or creditor's sale or similar proceeding, (ii) by purchase as part of a bulk transaction not in ordinary course of business of the transferor, or (iii) as the successor in interest to an estate or other organization.

(d) If, under § 57A-3-303(a)(1), the promise of performance that is the consideration for an instrument has been partially performed, the holder may assert rights as a holder in due course of the instrument only to the fraction of the amount payable under the instrument equal to the value of the partial performance divided by the value of the promised performance.

(e) If (i) the person entitled to enforce an instrument has only a security interest in the instrument and (ii) the person obliged to pay the instrument has a defense, claim in recoupment, or claim to the instrument that may be asserted against the person who granted the security interest, the person entitled to enforce the instrument may assert rights as a holder in due course only to an amount payable under the instrument which, at the time of enforcement of the instrument, does not exceed the amount of the unpaid obligation secured.

(f) To be effective, notice must be received at a time and in a manner that gives a reasonable opportunity to act on it.

(g) This section is subject to any law limiting status as a holder in due course in particular classes of transactions.

Source: SL 1994, ch 367, § 3-302.
S.D. Codified Laws § 57A-2-707 — SD Code / Title 57A / Chapter 2 / Section 57A-2-707
"Person in the position of a seller"
Status: in_force

(1) A "person in the position of a seller" includes as against a principal an agent who has paid or become responsible for the price of goods on behalf of his principal or anyone who otherwise holds a security interest or other right in goods similar to that of a seller.

(2) A person in the position of a seller may as provided in this chapter withhold or stop delivery (§ 57A-2-705 ) and resell (§ 57A-2-706 ) and recover incidental damages (§ 57A-2-710 ).

Source: SL 1966, ch 150, § 2-707; SDCL, §§ 57-8-20, 57-8-21.
S.D. Codified Laws § 57A-4-106 — SD Code / Title 57A / Chapter 4 / Section 57A-4-106
Payable through or payable at bank--Collecting bank
Status: in_force

(a) If an item states that it is "payable through" a bank identified in the item, (i) the item designates the bank as a collecting bank and does not by itself authorize the bank to pay the item, and (ii) the item may be presented for payment only by or through the bank.

(b) If an item states that it is "payable at" a bank identified in the item, the item is equivalent to a draft drawn on the bank.

Source: SL 1994, ch 368, § 4-106.
S.D. Codified Laws § 57A-4A-106 — SD Code / Title 57A / Chapter 4A / Section 57A-4A-106
Time payment order is received
Status: in_force

(a) The time of receipt of a payment order or communication cancelling or amending a payment order is determined by the rules applicable to receipt of a notice stated in § 57A-1-202 . A receiving bank may fix a cut-off time or times on a funds-transfer business day for the receipt and processing of payment orders and communications cancelling or amending payment orders. Different cut-off times may apply to payment orders, cancellations or amendments, or to different categories of payment orders, cancellations or amendments. A cut-off time may apply to senders generally or different cut-off times may apply to different senders or categories of payment orders. If a payment order or communication cancelling or amending a payment order is received after the close of a funds-transfer business day or after the appropriate cut-off time on a funds-transfer business day, the receiving bank may treat the payment order or communication as received at the opening of the next funds-transfer business day.

(b) If this chapter refers to an execution date or payment date or states a day on which a receiving bank is required to take action, and the date or day does not fall on a funds-transfer business day, the next day that is a funds-transfer business day is treated as the date or day stated, unless the contrary is stated in this chapter.

Source: SL 1991, ch 397, § 1; SL 2008, ch 259, § 38.
S.D. Codified Laws § 57A-9-515 — SD Code / Title 57A / Chapter 9 / Section 57A-9-515
Effective period for filed financing statement--Effect of lapse
Status: in_force

(a) Except as otherwise provided in subsections (b), (e), (f), and (g), a filed financing statement is effective for a period of five years after the date of filing. Financing statements filed before July 1, 1997, are effective for a period of five years from the date of filing and thereafter for a period of sixty days.

The expiration date established by a financing statement filed prior to July 1, 1997, whether or not continued by a continuation statement shall remain in full force and effect and is not diminished by any subsequent amendments to this chapter.

(b) Except as otherwise provided in subsections (e), (f), and (g), an initial financing statement filed in connection with a manufactured-home transaction is effective for a period of thirty years after the date of filing if it indicates that it is filed in connection with a manufactured-home transaction.

(c) The effectiveness of a filed financing statement lapses on the expiration of the period of its effectiveness unless before the lapse a continuation statement is filed pursuant to subsection (d). Upon lapse, a financing statement ceases to be effective and any security interest or agricultural lien that was perfected by the financing statement becomes unperfected, unless the security interest is perfected otherwise. If the security interest or agricultural lien becomes unperfected upon lapse, it is deemed never to have been perfected as against a purchaser of the collateral for value.

(d) A continuation statement may be filed only within six months before the expiration of the five-year period specified in subsection (a) or the thirty-year period specified in subsection (b), whichever is applicable.

However, for financing statements filed before July 1, 1997, a continuation statement may be filed within six months before and sixty days after the expiration of the five-year period.

(e) Except as otherwise provided in § 57A-9-510 , upon timely filing of a continuation statement, the effectiveness of the initial financing statement continues for a period of five years and, for initial financing statements filed before July 1, 1997, the effectiveness of the initial financing statement continues for a period of five years and sixty days, commencing on the day on which the financing statement would have become ineffective in the absence of the filing. Upon the expiration of the five-year period, the financing statement lapses in the same manner as provided in subsection (c), unless, before the lapse, another continuation statement is filed pursuant to subsection (d). Succeeding continuation statements may be filed in the same manner to continue the effectiveness of the initial financing statement.

(f) If a debtor is a transmitting utility and a filed initial financing statement so indicates, the financing statement is effective until a termination statement is filed.

(g) A record of a mortgage that is effective as a financing statement filed as a fixture filing under § 57A-9-502(c) remains effective as a financing statement filed as a fixture filing until the mortgage is released or satisfied of record or its effectiveness otherwise terminates as to the real property.

Source: SL 2000, ch 231; SL 2001, ch 261, § 3; SL 2012, ch 238, § 13, eff. July 1, 2013.
S.D. Codified Laws § 57A-3-113 — SD Code / Title 57A / Chapter 3 / Section 57A-3-113
Date of instrument
Status: in_force

(a) An instrument may be antedated or postdated. The date stated determines the time of payment if the instrument is payable at a fixed period after date. Except as provided in § 57A-4-401(c), an instrument payable on demand is not payable before the date of the instrument.

(b) If an instrument is undated, its date is the date of its issue or, in the case of an unissued instrument, the date it first comes into possession of a holder.

Source: SL 1994, ch 367, § 3-113.
S.D. Codified Laws § 57A-8-503 — SD Code / Title 57A / Chapter 8 / Section 57A-8-503
Property interest of entitlement holder in financial asset held by securities intermediary
Status: in_force

(a) To the extent necessary for a securities intermediary to satisfy all security entitlements with respect to a particular financial asset, all interests in that financial asset held by the securities intermediary are held by the securities intermediary for the entitlement holders, are not property of the securities intermediary, and are not subject to claims of creditors of the securities intermediary, except as otherwise provided in § 57A-8-511 .

(b) An entitlement holder's property interest with respect to a particular financial asset under subsection (a) is a pro rata property interest in all interests in that financial asset held by the securities intermediary, without regard to the time the entitlement holder acquired the security entitlement or the time the securities intermediary acquired the interest in that financial asset.

(c) An entitlement holder's property interest with respect to a particular financial asset under subsection (a) may be enforced against the securities intermediary only by exercise of the entitlement holder's rights under §§ 57A-8-505 to 57A-8-508 , inclusive.

(d) An entitlement holder's property interest with respect to a particular financial asset under subsection (a) may be enforced against a purchaser of the financial asset or interest therein only if:

(1) Insolvency proceedings have been initiated by or against the securities intermediary;

(2) The securities intermediary does not have sufficient interests in the financial asset to satisfy the security entitlements of all of its entitlement holders to that financial asset;

(3) The securities intermediary violated its obligations under § 57A-8-504 by transferring the financial asset or interest therein to the purchaser; and

(4) The purchaser is not protected under subsection (e).

The trustee or other liquidator, acting on behalf of all entitlement holders having security entitlements with respect to a particular financial asset, may recover the financial asset, or interest therein, from the purchaser. If the trustee or other liquidator elects not to pursue that right, an entitlement holder whose security entitlement remains unsatisfied has the right to recover its interest in the financial asset from the purchaser.

(e) An action based on the entitlement holder's property interest with respect to a particular financial asset under subsection (a), whether framed in conversion, replevin, constructive trust, equitable lien, or other theory, may not be asserted against any purchaser of a financial asset or interest therein who gives value, obtains control, and does not act in collusion with the securities intermediary in violating the securities intermediary's obligations under § 57A-8-504 .

Source: SL 1998, ch 284, § 1.
S.D. Codified Laws § 57A-2-320 — SD Code / Title 57A / Chapter 2 / Section 57A-2-320
C.I.F. and C. & F. terms
Status: in_force

(1) The term C.I.F. means that the price includes in a lump sum the cost of the goods and the insurance and freight to the named destination. The term C. & F. or C.F. means that the price so includes cost and freight to the named destination.

(2) Unless otherwise agreed and even though used only in connection with the stated price and destination, the term C.I.F. destination or its equivalent requires the seller at his own expense and risk to

(a) Put the goods into the possession of a carrier at the port for shipment and obtain a negotiable bill or bills of lading covering the entire transportation to the named destination; and

(b) Load the goods and obtain a receipt from the carrier (which may be contained in the bill of lading) showing that the freight has been paid or provided for; and

(c) Obtain a policy or certificate of insurance, including any war risk insurance, of a kind and on terms then current at the port of shipment in the usual amount, in the currency of the contract, shown to cover the same goods covered by the bill of lading and providing for payment of loss to the order of the buyer or for the account of whom it may concern; but the seller may add to the price the amount of the premium for any such war risk insurance; and

(d) Prepare an invoice of the goods and procure any other documents required to effect shipment or to comply with the contract; and

(e) Forward and tender with commercial promptness all the documents in due form and with any endorsement necessary to perfect the buyer's rights.

(3) Unless otherwise agreed the term C. & F. or its equivalent has the same effect and imposes upon the seller the same obligations and risks as a C.I.F. term except the obligation as to insurance.

(4) Under the term C.I.F. or C. & F. unless otherwise agreed the buyer must make payment against tender of the required documents and the seller may not tender nor the buyer demand delivery of the goods in substitution for the documents.

Source: SL 1966, ch 150, § 2-320; SDCL, §§ 57-4-46 to 57-4-49.
S.D. Codified Laws § 57A-13-301 — SD Code / Title 57A / Chapter 13 / Section 57A-13-301
Saving clause application
Status: in_force

(a) Except as provided in this section, chapter 57A-9 as amended by SL 2024, ch 198 and chapter 57A-12 , apply to a transaction, lien, or other interest in property, even if the transaction, lien, or interest was entered into, created, or acquired before July 1, 2024.

(b) Except as provided in subsection (c) and §§ 57A-13-302 to 57A-13-306 , inclusive:

(1) A transaction, lien, or interest in property that was validly entered into, created, or transferred before July 1, 2024, and was not governed by title 57A, but would be subject to chapter 57A-9 as amended by SL 2024, ch 198 or chapter 57A-12 , if it had been entered into, created, or transferred on or after July 1, 2024, including the rights, duties, and interests flowing from the transaction, lien, or interest, remains valid on and after July 1, 2024;

(2) The transaction, lien, or interest may be terminated, completed, consummated, and enforced as required or permitted by SL 2024, ch 198 or by the law that would apply if SL 2024, ch 198 had not taken effect.

(c) SL 2024, ch 198 does not affect an action, case, or proceeding commenced before July 1, 2024.

Source: SL 2024, ch 198, § 104.
S.D. Codified Laws § 57A-4A-302 — SD Code / Title 57A / Chapter 4A / Section 57A-4A-302
Obligation of receiving bank in execution of payment order
Status: in_force

(a) Except as provided in subsections (b) through (d), if the receiving bank accepts a payment order pursuant to § 57A-4A-209(a), the bank has the following obligations in executing the order:

(1) The receiving bank is obliged to issue, on the execution date, a payment order complying with the sender's order and to follow the sender's instructions concerning (i) any intermediary bank or funds - transfer system to be used in carrying out the funds transfer, or (ii) the means by which payment orders are to be transmitted in the funds transfer. If the originator's bank issues a payment order to an intermediary bank, the originator's bank is obliged to instruct the intermediary bank according to the instruction of the originator. An intermediary bank in the funds transfer is similarly bound by an instruction given to it by the sender of the payment order it accepts.

(2) If the sender's instruction states that the funds transfer is to be carried out telephonically or by wire transfer or otherwise indicates that the funds transfer is to be carried out by the most expeditious means, the receiving bank is obliged to transmit its payment order by the most expeditious available means, and to instruct any intermediary bank accordingly. If a sender's instruction states a payment date, the receiving bank is obliged to transmit its payment order at a time and by means reasonably necessary to allow payment to the beneficiary on the payment date or as soon thereafter as is feasible.

(b) Unless otherwise instructed, a receiving bank executing a payment order may (i) use any funds - transfer system if use of that system is reasonable in the circumstances, and (ii) issue a payment order to the beneficiary's bank or to an intermediary bank through which a payment order conforming to the sender's order can expeditiously be issued to the beneficiary's bank if the receiving bank exercises ordinary care in the selection of the intermediary bank. A receiving bank is not required to follow an instruction of the sender designating a funds - transfer system to be used in carrying out the funds transfer if the receiving bank, in good faith, determines that it is not feasible to follow the instruction or that following the instruction would unduly delay completion of the funds transfer.

(c) Unless subsection (a)(2) applies or the receiving bank is otherwise instructed, the bank may execute a payment order by transmitting its payment order by first class mail or by any means reasonable in the circumstances. If the receiving bank is instructed to execute the sender's order by transmitting its payment order by a particular means, the receiving bank may issue its payment order by the means stated or by any means as expeditious as the means stated.

(d) Unless instructed by the sender, (i) the receiving bank may not obtain payment of its charges for services and expenses in connection with the execution of the sender's order by issuing a payment order in an amount equal to the amount of the sender's order less the amount of the charges, and (ii) may not instruct a subsequent receiving bank to obtain payment of its charges in the same manner.

Source: SL 1991, ch 397, § 1.
S.D. Codified Laws § 57A-3-107 — SD Code / Title 57A / Chapter 3 / Section 57A-3-107
Instrument payable in foreign money
Status: in_force

Unless the instrument otherwise provides, an instrument that states the amount payable in foreign money may be paid in the foreign money or in an equivalent amount in dollars calculated by using the current bank - offered spot rate at the place of payment for the purchase of dollars on the day on which the instrument is paid.

Source: SL 1994, ch 367, § 3-107.
S.D. Codified Laws § 57A-7-206 — SD Code / Title 57A / Chapter 7 / Section 57A-7-206
Termination of storage at warehouse's option
Status: in_force

(a) A warehouse, by giving notice to the person on whose account the goods are held and any other person known to claim an interest in the goods, may require payment of any charges and removal of the goods from the warehouse at the termination of the period of storage fixed by the document of title or, if a period is not fixed, within a stated period not less than thirty days after the warehouse gives notice. If the goods are not removed before the date specified in the notice, the warehouse may sell them pursuant to § 57A-7-210 .

(b) If a warehouse in good faith believes that goods are about to deteriorate or decline in value to less than the amount of its lien within the time provided in subsection (a) and § 57A-7-210 , the warehouse may specify in the notice given under subsection (a) any reasonable shorter time for removal of the goods and, if the goods are not removed, may sell them at public sale held not less than one week after a single advertisement or posting.

(c) If, as a result of a quality or condition of the goods of which the warehouse did not have notice at the time of deposit, the goods are a hazard to other property, the warehouse facilities, or other persons, the warehouse may sell the goods at public or private sale without advertisement or posting on reasonable notification to all persons known to claim an interest in the goods. If the warehouse, after a reasonable effort, is unable to sell the goods, it may dispose of them in any lawful manner and does not incur liability by reason of that disposition.

(d) A warehouse shall deliver the goods to any person entitled to them under this chapter upon due demand made at any time before sale or other disposition under this section.

(e) A warehouse may satisfy its lien from the proceeds of any sale or disposition under this section but shall hold the balance for delivery on the demand of any person to which the warehouse would have been bound to deliver the goods.

Source: SL 2009, ch 254, § 7-206.
S.D. Codified Laws § 57A-2-510 — SD Code / Title 57A / Chapter 2 / Section 57A-2-510
Effect of breach on risk of loss
Status: in_force

(1) Where a tender or delivery of goods so fails to conform to the contract as to give a right of rejection the risk of their loss remains on the seller until cure or acceptance.

(2) Where the buyer rightfully revokes acceptance he may to the extent of any deficiency in his effective insurance coverage treat the risk of loss as having rested on the seller from the beginning.

(3) Where the buyer as to conforming goods already identified to the contract for sale repudiates or is otherwise in breach before risk of their loss has passed to him, the seller may to the extent of any deficiency in his effective insurance coverage treat the risk of loss as resting on the buyer for a commercially reasonable time.

Source: SL 1966, ch 150, § 2-510; SDCL, §§ 57-6-25 to 57-6-27.
S.D. Codified Laws § 57A-8-115 — SD Code / Title 57A / Chapter 8 / Section 57A-8-115
Securities intermediary and others not liable to adverse claimant
Status: in_force

A securities intermediary that has transferred a financial asset pursuant to an effective entitlement order, or a broker or other agent or bailee that has dealt with a financial asset at the direction of its customer or principal, is not liable to a person having an adverse claim to the financial asset, unless the securities intermediary, or broker or other agent or bailee:

(1) Took the action after it had been served with an injunction, restraining order, or other legal process enjoining it from doing so, issued by a court of competent jurisdiction, and had a reasonable opportunity to act on the injunction, restraining order, or other legal process; or

(2) Acted in collusion with the wrongdoer in violating the rights of the adverse claimant; or

(3) In the case of a security certificate that has been stolen, acted with notice of the adverse claim.

Source: SL 1998, ch 284, § 1.
S.D. Codified Laws § 57A-3-417 — SD Code / Title 57A / Chapter 3 / Section 57A-3-417
Presentment warranties
Status: in_force

(a) If an unaccepted draft is presented to the drawee for payment or acceptance and the drawee pays or accepts the draft, (i) the person obtaining payment or acceptance, at the time of presentment, and (ii) a previous transferor of the draft, at the time of transfer, warrant to the drawee making payment or accepting the draft in good faith that:

(1) The warrantor is, or was, at the time the warrantor transferred the draft, a person entitled to enforce the draft or authorized to obtain payment or acceptance of the draft on behalf of a person entitled to enforce the draft;

(2) The draft has not been altered; and

(3) The warrantor has no knowledge that the signature of the drawer of the draft is unauthorized.

(b) A drawee making payment may recover from any warrantor damages for breach of warranty equal to the amount paid by the drawee less the amount the drawee received or is entitled to receive from the drawer because of the payment. In addition, the drawee is entitled to compensation for expenses and loss of interest resulting from the breach. The right of the drawee to recover damages under this subsection is not affected by any failure of the drawee to exercise ordinary care in making payment. If the drawee accepts the draft, breach of warranty is a defense to the obligation of the acceptor. If the acceptor makes payment with respect to the draft, the acceptor is entitled to recover from any warrantor for breach of warranty the amounts stated in this subsection.

(c) If a drawee asserts a claim for breach of warranty under subsection (a) based on an unauthorized indorsement of the draft or an alteration of the draft, the warrantor may defend by proving that the indorsement is effective under § 57A-3-404 or 57A-3-405 or the drawer is precluded under § 57A-3-406 or 57A-4-406 from asserting against the drawee the unauthorized indorsement or alteration.

(d) If (i) a dishonored draft is presented for payment to the drawer or an indorser or (ii) any other instrument is presented for payment to a party obliged to pay the instrument, and (iii) payment is received, the following rules apply:

(1) The person obtaining payment and a prior transferor of the instrument warrant to the person making payment in good faith that the warrantor is, or was, at the time the warrantor transferred the instrument, a person entitled to enforce the instrument or authorized to obtain payment on behalf of a person entitled to enforce the instrument.

(2) The person making payment may recover from any warrantor for breach of warranty an amount equal to the amount paid plus expenses and loss of interest resulting from the breach.

(e) The warranties stated in subsections (a) and (d) cannot be disclaimed with respect to checks. Unless notice of a claim for breach of warranty is given to the warrantor within thirty days after the claimant has reason to know of the breach and the identity of the warrantor, the liability of the warrantor under subsection (b) or (d) is discharged to the extent of any loss caused by the delay in giving notice of the claim.

(f) A cause of action for breach of warranty under this section accrues when the claimant has reason to know of the breach.

Source: SL 1994, ch 367, § 3-417.
S.D. Codified Laws § 57A-9-106 — SD Code / Title 57A / Chapter 9 / Section 57A-9-106
Control of security, security settlement, or commodity contract
Status: in_force

(a) A person has control of a certificated security, uncertificated security, or security entitlement as provided in § 57A-8-106 .

(b) A secured party has control of a commodity contract if:

(1) The secured party is the commodity intermediary with which the commodity contract is carried; or

(2) The commodity customer, secured party, and commodity intermediary have agreed that the commodity intermediary will apply any value distributed on account of the commodity contract as directed by the secured party without further consent by the commodity customer.

(c) A secured party having control of all security entitlements or commodity contracts carried in a securities account or commodity account has control over the securities account or commodity account.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-9-623 — SD Code / Title 57A / Chapter 9 / Section 57A-9-623
Persons who may redeem collateral--Procedure
Status: in_force

(a) A debtor, any secondary obligor, or any other secured party or lienholder may redeem collateral.

(b) To redeem collateral, a person shall tender:

(1) Fulfillment of all obligations secured by the collateral; and

(2) The reasonable expenses and attorney's fees described in § 57A-9-615(a)(1).

(c) A redemption may occur at any time before a secured party:

(1) Has collected collateral under § 57A-9-607 ;

(2) Has disposed of collateral or entered into a contract for its disposition under § 57A-9-610 ; or

(3) Has accepted collateral in full or partial satisfaction of the obligation it secures under § 57A-9-622 .

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-7-702 — SD Code / Title 57A / Chapter 7 / Section 57A-7-702
Savings clause
Status: in_force

A document of title issued or a bailment that arises before July 1, 2009 and the rights, obligations, and interests flowing from that document or bailment are governed by any statute or other rule amended or repealed by SL 2009, ch 254 as if amendment or repeal had not occurred and may be terminated, completed, consummated, or enforced under that statute or other rule.

Source: SL 2009, ch 254, § 7-704.
S.D. Codified Laws § 57A-2-508 — SD Code / Title 57A / Chapter 2 / Section 57A-2-508
Cure by seller of improper tender or delivery--Replacement
Status: in_force

(1) Where any tender or delivery by the seller is rejected because nonconforming and the time for performance has not yet expired, the seller may seasonably notify the buyer of his intention to cure and may then within the contract time make a conforming delivery.

(2) Where the buyer rejects a nonconforming tender which the seller had reasonable grounds to believe would be acceptable with or without money allowance the seller may if he seasonably notifies the buyer have a further reasonable time to substitute a conforming tender.

Source: SL 1966, ch 150, § 2-508; SDCL, §§ 57-6-19, 57-6-20.
S.D. Codified Laws § 57A-3A-103 — SD Code / Title 57A / Chapter 3A / Section 57A-3A-103
Failure to mark consumer paper as misdemeanor
Status: in_force

Any retail seller or other responsible person who fails to imprint conspicuously the words "consumer paper" on an instrument arising out of a consumer credit sale as described in this chapter shall be guilty of a Class 2 misdemeanor.

Source: SL 1973, ch 295, § 5; SDCL Supp, § 57-10A-3; SL 1980, ch 24, § 111.
S.D. Codified Laws § 57A-2A-529 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-529
Lessor's action for a rent
Status: in_force

(1) After default by the lessee under the lease contract (§ 57A-2A-523(1)), if the lessor complies with subsection (2) of this section, the lessor may recover from the lessee as damages:

(a) For goods accepted by the lessee and not repossessed by or effectively tendered back to the lessor and for conforming goods lost or damaged after risk of loss passes to the lessee (§ 57A-2A-219 ),

(i) Accrued and unpaid rent as of the date of entry of judgment in favor of lessor,

(ii) The present value as of the date determined under subparagraph (i) of the rent for the then remaining lease term of the lease agreement, and

(iii) Any incidental damages allowed under § 57A-2A-530 , less expenses saved in consequence of the lessee's default; and

(b) For goods identified to the lease contract where the lessor has never delivered the goods or has taken possession of them or the lessee has effectively tendered them back to the lessor, if the lessor is unable after reasonable effort to dispose of them at a reasonable price or the circumstances reasonably indicate that such an effort will be unavailing,

(i) Accrued and unpaid rent as of the date of entry of judgment in favor of the lessor,

(ii) The present value as of the date determined under subparagraph (i) of the rent for the then remaining lease term of the lease agreement, and

(iii) Any incidental damages allowed under § 57A-2A-530 , less expenses saved in consequence of the lessee's default.

(2) Except as provided in subsection (3) of this section, the lessor shall hold for the lessee for the remaining lease term of the lease agreement any goods that have been identified to the lease contract and are in the lessor's control.

(3) The lessor may dispose of the goods at any time before collection of the judgment for damages obtained pursuant to subsection (1) of this section. If the disposition is before the end of the remaining lease term of the lease agreement, the lessor's recovery against the lessee for damages will be governed by § 57A-2A-527 or 57A-2A-528 , and the lessor will cause an appropriate credit to be provided against any judgment for damages to the extent that the amount of the judgment exceeds the recovery available pursuant to § 57A-2A-527 or 57A-2A-528 .

(4) Payment of the judgment for damages obtained pursuant to subsection (1) of this section entitles the lessee to use and possession of the goods not then disposed of for the remaining lease term of the lease agreement, provided that the lessee complies with all other terms and conditions of the lease agreement.

(5) After a lessee has wrongfully rejected or revoked acceptance of goods, has failed to pay rent then due, or has repudiated (§ 57A-2A-402 ), a lessor who is held not entitled to rent under this section must nevertheless be awarded damages for nonacceptance under §§ 57A-2A-527 and 57A-2A-528 .

Source: SL 1989, ch 419, § 1; SL 1990, ch 390, § 25.
S.D. Codified Laws § 57A-4-111 — SD Code / Title 57A / Chapter 4 / Section 57A-4-111
Statute of limitations
Status: in_force

An action to enforce an obligation, duty, or right arising under this chapter must be commenced within three years after the cause of action accrues.

Source: SL 1994, ch 368, § 4-111.
S.D. Codified Laws § 57A-13-304 — SD Code / Title 57A / Chapter 13 / Section 57A-13-304
Effectiveness of actions taken before effective date
Status: in_force

(a) If action, other than the filing of a financing statement, is taken before July 1, 2024, and the action would have resulted in perfection of the security interest had the security interest become enforceable before July 1, 2024, the action is effective to perfect a security interest that attaches under SL 2024, ch 198 before the adjustment date. An attached security interest becomes unperfected on the adjustment date unless the security interest becomes a perfected security interest under SL 2024, ch 198 before the adjustment date.

(b) The filing of a financing statement before July 1, 2024, is effective to perfect a security interest on July 1, 2024, to the extent the filing would satisfy the requirements for perfection under SL 2024, ch 198.

(c) The taking of an action before July 1, 2024, is sufficient for the enforceability of a security interest on July 1, 2024, if the action would satisfy the requirements for enforceability under SL 2024, ch 198.

Source: SL 2024, ch 198, § 107.
S.D. Codified Laws § 57A-2A-201 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-201
Statute of frauds
Status: in_force

(1) A lease contract is not enforceable by way of action or defense unless:

(a) In a lease contract that is not a consumer lease, the total payments to be made under the lease contract, excluding payments for options to renew or buy, are less than one thousand dollars; or

(b) There is a record, signed by the party against whom enforcement is sought or by that party's authorized agent, sufficient to indicate that a lease contract has been made between the parties and to describe the goods leased and the lease term.

(2) Any description of leased goods or of the lease term is sufficient and satisfies subsection (1)(b) of this section, whether or not it is specific, if it reasonably identifies what is described.

(3) A record is not insufficient because it omits or incorrectly states a term agreed upon, but the lease contract is not enforceable under subsection (1)(b) of this section beyond the lease term and the quantity of goods shown in the record.

(4) A lease contract that does not satisfy the requirements of subsection (1) of this section, but which is valid in other respects, is enforceable:

(a) If the goods are to be specially manufactured or obtained for the lessee and are not suitable for lease or sale to others in the ordinary course of the lessor's business, and the lessor, before notice of repudiation is received and under circumstances that reasonably indicate that the goods are for the lessee, has made either a substantial beginning of their manufacture or commitments for their procurement;

(b) If the party against whom enforcement is sought admits in that party's pleading, testimony or otherwise in court that a lease contract was made, but the lease contract is not enforceable under this provision beyond the quantity of goods admitted; or

(c) With respect to goods that have been received and accepted by the lessee.

(5) The lease term under a lease contract referred to in subsection (4) of this section is:

(a) If there is a record signed by the party against whom enforcement is sought or by that party's authorized agent specifying the lease term, the term so specified;

(b) If the party against whom enforcement is sought admits in that party's pleading, testimony, or otherwise in court a lease term, the term so admitted; or

(c) A reasonable lease term.

Source: SL 1989, ch 419, § 1; SL 1990, ch 390, § 5; SL 2024, ch 198, § 16.
S.D. Codified Laws § 57A-4-407 — SD Code / Title 57A / Chapter 4 / Section 57A-4-407
Payor bank's right to subrogation on improper payment
Status: in_force

If a payor bank has paid an item over the order of the drawer or maker to stop payment, or after an account has been closed, or otherwise under circumstances giving a basis for objection by the drawer or maker, to prevent unjust enrichment and only to the extent necessary to prevent loss to the bank by reason of its payment of the item, the payor bank is subrogated to the rights:

(1) Of any holder in due course on the item against the drawer or maker;

(2) Of the payee or any other holder of the item against the drawer or maker either on the item or under the transaction out of which the item arose; and

(3) Of the drawer or maker against the payee or any other holder of the item with respect to the transaction out of which the item arose.

Source: SL 1994, ch 368, § 4-407.
S.D. Codified Laws § 57A-3-503 — SD Code / Title 57A / Chapter 3 / Section 57A-3-503
Notice of dishonor
Status: in_force

(a) The obligation of an indorser stated in § 57A-3-415(a) and the obligation of a drawer stated in § 57A-3-414(d) may not be enforced unless (i) the indorser or drawer is given notice of dishonor of the instrument complying with this section or (ii) notice of dishonor is excused under § 57A-3-504(b).

(b) Notice of dishonor may be given by any person; may be given by any commercially reasonable means, including an oral, written, or electronic communication; and is sufficient if it reasonably identifies the instrument and indicates that the instrument has been dishonored or has not been paid or accepted. Return of an instrument given to a bank for collection is sufficient notice of dishonor.

(c) Subject to § 57A-3-504(c), with respect to an instrument taken for collection by a collecting bank, notice of dishonor must be given (i) by the bank before midnight of the next banking day following the banking day on which the bank receives notice of dishonor of the instrument, or (ii) by any other person within thirty days following the day on which the person receives notice of dishonor. With respect to any other instrument, notice of dishonor must be given within thirty days following the day on which dishonor occurs.

Source: SL 1994, ch 367, § 3-503.
S.D. Codified Laws § 57A-2-604 — SD Code / Title 57A / Chapter 2 / Section 57A-2-604
Buyer's options as to salvage of rightfully rejected goods
Status: in_force

Subject to the provisions of § 57A-2-603 on perishables if the seller gives no instructions within a reasonable time after notification of rejection the buyer may store the rejected goods for the seller's account or reship them to him or resell them for the seller's account with reimbursement as provided in § 57A-2-603 . Such action is not acceptance or conversion.

Source: SL 1966, ch 150, § 2-604; SDCL, § 57-7-8.
S.D. Codified Laws § 57A-12-102 — SD Code / Title 57A / Chapter 12 / Section 57A-12-102
Definitions
Status: in_force

(a) In this chapter:

(1) "Controllable electronic record" means a record stored in an electronic medium that can be subjected to control under § 57A-12-105 . The term does not include a controllable account, a controllable payment intangible, a deposit account, an electronic copy of a record evidencing chattel paper, an electronic document of title, electronic money, investment property, or a transferable record.

(2) "Qualifying purchaser" means a purchaser of a controllable electronic record or an interest in a controllable electronic record that obtains control of the controllable electronic record for value, in good faith, and without notice of a claim of a property right in the controllable electronic record.

(3) "Transferable record" has the meaning provided for that term in:

(A) Section 201(a)(1) of the Electronic Signatures in Global and National Commerce Act, 15 U.S.C. § 7021(a)(1), as amended and in effect January 1, 2024; or

(B) As defined in § 53-12-40 .

(4) "Value" has the meaning provided in § 57A-3-303 (a), as if references in that subsection to an "instrument" were references to a controllable account, controllable electronic record, or controllable payment intangible.

(b) The definitions in chapter 57A-9 of "account debtor," "controllable account," "controllable payment intangible," "chattel paper," "deposit account," "electronic money," and "investment property" apply to this chapter.

(c) Chapter 57A-1 contains general definitions and principles of construction and interpretation applicable throughout this chapter.

Source: SL 2024, ch 198, § 94.
S.D. Codified Laws § 57A-9-603 — SD Code / Title 57A / Chapter 9 / Section 57A-9-603
Agreement on standards for fulfilling rights and duties
Status: in_force

(a) The parties may determine by agreement the standards measuring the fulfillment of the rights of a debtor or obligor and the duties of a secured party under a rule stated in § 57A-9-602 if the standards are not manifestly unreasonable.

(b) Subsection (a) does not apply to the duty under § 57A-9-609 to refrain from breaching the peace.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-2A-521 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-521
Lessee's right to specific performance or replevin
Status: in_force

(1) Specific performance may be decreed if the goods are unique or in other proper circumstances.

(2) A decree for specific performance may include any terms and conditions as to payment of the rent, damages or other relief that the court deems just.

(3) A lessee has a right of replevin, detinue, sequestration, claim and delivery, or the like for goods identified to the lease contract if after reasonable effort the lessee is unable to effect cover for those goods or the circumstances reasonably indicate that the effort will be unavailing.

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-9-306 — SD Code / Title 57A / Chapter 9 / Section 57A-9-306
Law governing issues of perfection and priority relating to letter-of-credit rights
Status: in_force

(a) Subject to subsection (c), the local law of the issuer's jurisdiction or a nominated person's jurisdiction governs perfection, the effect of perfection or nonperfection, and the priority of a security interest in a letter - of - credit right if the issuer's jurisdiction or nominated person's jurisdiction is a state.

(b) For purposes of this part, an issuer's jurisdiction or nominated person's jurisdiction is the jurisdiction whose law governs the liability of the issuer or nominated person with respect to the letter - of - credit right as provided in § 57A-5-116 .

(c) This section does not apply to a security interest that is perfected only under § 57A-9-308(d).

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-4-401 — SD Code / Title 57A / Chapter 4 / Section 57A-4-401
When bank may charge customer's account
Status: in_force

(a) A bank may charge against the account of a customer an item that is properly payable from that account even though the charge creates an overdraft. An item is properly payable if it is authorized by the customer and is in accordance with any agreement between the customer and bank.

(b) A customer is not liable for the amount of an overdraft if the customer neither signed the item nor benefited from the proceeds of the item.

(c) A bank may charge against the account of a customer a check that is otherwise properly payable from the account, even though payment was made before the date of the check, unless the customer has given notice to the bank of the postdating describing the check with reasonable certainty. The notice is effective for the period stated in § 57A-4-403(b) for stop - payment orders, and must be received at such time and in such manner as to afford the bank a reasonable opportunity to act on it before the bank takes any action with respect to the check described in § 57A-4-303 . If a bank charges against the account of a customer a check before the date stated in the notice of postdating, the bank is liable for damages for the loss resulting from its act. The loss may include damages for dishonor of subsequent items under § 57A-4-402 .

(d) A bank that in good faith makes payment to a holder may charge the indicated account of its customer according to:

(1) The original terms of the altered item; or

(2) The terms of the completed item, even though the bank knows the item has been completed unless the bank has notice that the completion was improper.

Source: SL 1994, ch 368, § 4-401.
S.D. Codified Laws § 57A-9-805 — SD Code / Title 57A / Chapter 9 / Section 57A-9-805
Effectiveness of action taken before effective date
Status: in_force

(a) The filing of a financing statement before July 1, 2013 is effective to perfect a security interest to the extent the filing would satisfy the applicable requirements for perfection under chapter 57A-9 as amended by SL 2012, ch 238.

(b) SL 2012, ch 238 does not render ineffective an effective financing statement that, before July 1, 2013, is filed and satisfies the applicable requirements for perfection under the law of the jurisdiction governing perfection as provided in chapter 57A-9 as it existed before July 1, 2013. However, except as otherwise provided in subsections (c) and (d) and § 57A-9-806 , the financing statement ceases to be effective:

(1) If the financing statement is filed in this state, at the time the financing statement would have ceased to be effective had SL 2012, ch 238 not taken effect; or

(2) If the financing statement is filed in another jurisdiction, at the earlier of:

(A) The time the financing statement would have ceased to be effective under the law of that jurisdiction; or

(B) June 30, 2018.

(c) The filing of a continuation statement after SL 2012, ch 238 takes effect does not continue the effectiveness of a financing statement filed before July 1, 2013. However, upon the timely filing of a continuation statement after SL 2012, ch 238 takes effect and in accordance with the law of the jurisdiction governing perfection as provided in chapter 57A-9 as amended by SL 2012, ch 238, the effectiveness of a financing statement filed in the same office in that jurisdiction before July 1, 2013 continues for the period provided by the law of that jurisdiction.

(d) Subsection (b)(2)(B) applies to a financing statement that, before July 1, 2013, is filed against a transmitting utility and satisfies the applicable requirements for perfection under the law of the jurisdiction governing perfection as provided in chapter 57A-9 as it existed prior to July 1, 2013, only to the extent that chapter 57A-9 as amended by SL 2012, ch 238 provides that the law of a jurisdiction other than the jurisdiction in which the financing statement is filed governs perfection of a security interest in collateral covered by the financing statement.

(e) A financing statement that includes a financing statement filed before July 1, 2013 and a continuation statement filed after SL 2012, ch 238 takes effect is effective only to the extent that it satisfies the requirements of §§ 57A-9-501 to 57A-9-530 , inclusive, as amended by SL 2012, ch 238 for an initial financing statement. A financing statement that indicates that the debtor is a decedent's estate indicates that the collateral is being administered by a personal representative within the meaning of § 57A-9-503(a)(2) as amended by SL 2012, ch 238. A financing statement that indicates that the debtor is a trust or is a trustee acting with respect to property held in trust indicates that the collateral is held in a trust within the meaning of § 57A-9-503(a)(3) as amended by SL 2012, ch 238.

Source: SL 2012, ch 238, § 9-805, eff. July 1, 2013.
S.D. Codified Laws § 57A-8-306 — SD Code / Title 57A / Chapter 8 / Section 57A-8-306
Effect of guaranteeing signature, indorsement, or instruction
Status: in_force

(a) A person who guarantees a signature of an indorser of a security certificate warrants that at the time of signing:

(1) The signature was genuine;

(2) The signer was an appropriate person to indorse, or if the signature is by an agent, the agent had actual authority to act on behalf of the appropriate person; and

(3) The signer had legal capacity to sign.

(b) A person who guarantees a signature of the originator of an instruction warrants that at the time of signing:

(1) The signature was genuine;

(2) The signer was an appropriate person to originate the instruction, or if the signature is by an agent, the agent had actual authority to act on behalf of the appropriate person, if the person specified in the instruction as the registered owner was, in fact, the registered owner, as to which fact the signature guarantor does not make a warranty; and

(3) The signer had legal capacity to sign.

(c) A person who specially guarantees the signature of an originator of an instruction makes the warranties of a signature guarantor under subsection (b) and also warrants that at the time the instruction is presented to the issuer:

(1) The person specified in the instruction as the registered owner of the uncertificated security will be the registered owner; and

(2) The transfer of the uncertificated security requested in the instruction will be registered by the issuer free from all liens, security interests, restrictions, and claims other than those specified in the instruction.

(d) A guarantor under subsections (a) and (b) or a special guarantor under subsection (c) does not otherwise warrant the rightfulness of the transfer.

(e) A person who guarantees an indorsement of a security certificate makes the warranties of a signature guarantor under subsection (a) and also warrants the rightfulness of the transfer in all respects.

(f) A person who guarantees an instruction requesting the transfer of an uncertificated security makes the warranties of a special signature guarantor under subsection (c) and also warrants the rightfulness of the transfer in all respects.

(g) An issuer may not require a special guaranty of signature, a guaranty of indorsement, or a guaranty of instruction as a condition to registration of transfer.

(h) The warranties under this section are made to a person taking or dealing with the security in reliance on the guaranty, and the guarantor is liable to the person for loss resulting from their breach. An indorser or originator of an instruction whose signature, indorsement, or instruction has been guaranteed is liable to a guarantor for any loss suffered by the guarantor as a result of breach of the warranties of the guarantor.

Source: SL 1998, ch 284, § 1.
S.D. Codified Laws § 57A-2A-514 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-514
Waiver of lessee's objections
Status: in_force

(1) In rejecting goods, a lessee's failure to state a particular defect that is ascertainable by reasonable inspection precludes the lessee from relying on the defect to justify rejection or to establish default:

(a) If, stated seasonably, the lessor or the supplier could have cured it (§ 57A-2A-513 ); or

(b) Between merchants if the lessor or the supplier after rejection has made a request in writing for a full and final written statement of all defects on which the lessee proposes to rely.

(2) A lessee's failure to reserve rights when paying rent or other consideration against documents precludes recovery of the payment for defects apparent in the documents.

Source: SL 1989, ch 419, § 1; SL 2009, ch 254, § 819.
S.D. Codified Laws § 57A-4A-305 — SD Code / Title 57A / Chapter 4A / Section 57A-4A-305
Liability for late or improper execution or failure to execute payment order
Status: in_force

(a) If a funds transfer is completed but execution of a payment order by the receiving bank in breach of § 57A-4A-302 results in delay in payment to the beneficiary, the bank is obliged to pay interest to either the originator or the beneficiary of the funds transfer for the period of delay caused by the improper execution. Except as provided in subsection (c), additional damages are not recoverable.

(b) If execution of a payment order by a receiving bank in breach of § 57A-4A-302 results in (i) noncompletion of the funds transfer, (ii) failure to use an intermediary bank designated by the originator, or (iii) issuance of a payment order that does not comply with the terms of the payment order of the originator, the bank is liable to the originator for its expenses in the funds transfer and for incidental expenses and interest losses, to the extent not covered by subsection (a), resulting from the improper execution. Except as provided in subsection (c), additional damages are not recoverable.

(c) In addition to the amounts payable under subsection (a) and (b), damages, including consequential damages, are recoverable to the extent provided in an express agreement of the receiving bank, evidenced by a record.

(d) If a receiving bank fails to execute a payment order it was obliged by express agreement to execute, the receiving bank is liable to the sender for its expenses in the transaction and for incidental expenses and interest losses resulting from the failure to execute. Additional damages, including consequential damages, are recoverable to the extent provided in an express agreement of the receiving bank, evidenced by a record, but are not otherwise recoverable.

(e) Reasonable attorney's fees are recoverable if demand for compensation under subsection (a) or (b) is made and refused before an action is brought on the claim. If a claim is made for breach of an agreement under subsection (d) and the agreement does not provide for damages, reasonable attorney's fees are recoverable if demand for compensation under subsection (d) is made and refused before an action is brought on the claim.

(f) Except as stated in this section, the liability of a receiving bank under subsections (a) and (b) may not be varied by agreement.

Source: SL 1991, ch 397, § 1; SL 2024, ch 198, § 33.
S.D. Codified Laws § 57A-2-403 — SD Code / Title 57A / Chapter 2 / Section 57A-2-403
Power to transfer--Good faith purchase of goods--"Entrusting"
Status: in_force

(1) A purchaser of goods acquires all title which his transferor had or had power to transfer except that a purchaser of a limited interest acquires rights only to the extent of the interest purchased. A person with voidable title has power to transfer a good title to a good faith purchaser for value. When goods have been delivered under a transaction of purchase the purchaser has such power even though

(a) The transferor was deceived as to the identity of the purchaser; or

(b) The delivery was in exchange for a check which is later dishonored; or

(c) It was agreed that the transaction was to be a "cash sale"; or

(d) The delivery was procured through fraud punishable as theft under the criminal law.

(2) Any entrusting of possession of goods to a merchant who deals in goods of that kind gives him power to transfer all rights of the entruster to a buyer in ordinary course of business.

(3) "Entrusting" includes any delivery and any acquiescence in retention of possession regardless of any condition expressed between the parties to the delivery or acquiescence and regardless of whether the procurement of the entrusting or the possessor's disposition of the goods have been such as to be theft under the criminal law.

(4) The rights of other purchasers of goods and of lien creditors are governed by the chapters on secured transactions (chapter 57A-9 ) and documents of title (chapter 57A-7 ).

Source: SL 1966, ch 150, § 2-403; SDCL §§ 57-5-9 to 57-5-12; SL 1980, ch 23, §§ 2, 27; SL 1993, ch 356, § 3.
S.D. Codified Laws § 57A-1-107 — SD Code / Title 57A / Chapter 1 / Section 57A-1-107
Section captions
Status: in_force

Section captions are part of this title.

Source: SL 2008, ch 259, § 7.
S.D. Codified Laws § 57A-4-303 — SD Code / Title 57A / Chapter 4 / Section 57A-4-303
When items subject to notice, stop-payment order, legal process, or setoff--Order in which items may be charged or certified
Status: in_force

(a) Any knowledge, notice, or stop - payment order received by, legal process served upon, or setoff exercised by a payor bank comes too late to terminate, suspend, or modify the bank's right or duty to pay an item or to charge its customer's account for the item if the knowledge, notice, stop - payment order, or legal process is received or served and a reasonable time for the bank to act thereon expires or the setoff is exercised after the earliest of the following:

(1) The bank accepts or certifies the item;

(2) The bank pays the item in cash;

(3) The bank settles for the item without having a right to revoke the settlement under statute, clearing - house rule, or agreement;

(4) The bank becomes accountable for the amount of the item under § 57A-4-302 dealing with the payor bank's responsibility for late return of items; or

(5) With respect to checks, a cutoff hour no earlier than one hour after the opening of the next banking day after the banking day on which the bank received the check and no later than the close of that next banking day or, if no cutoff hour is fixed, the close of the next banking day after the banking day on which the bank received the check.

(b) Subject to subsection (a), items may be accepted, paid, certified, or charged to the indicated account of its customer in any order.

Source: SL 1994, ch 368, § 4-303.
S.D. Codified Laws § 57A-9-616 — SD Code / Title 57A / Chapter 9 / Section 57A-9-616
Explanation of calculation of surplus or deficiency
Status: in_force

(a) In this section:

(1) "Explanation" means a record that:

(A) States the amount of the surplus or deficiency;

(B) Provides an explanation in accordance with subsection (c) of how the secured party calculated the surplus or deficiency;

(C) States, if applicable, that future debits, credits, charges, including additional credit service charges or interest, rebates, and expenses may affect the amount of the surplus or deficiency; and

(D) Provides a telephone number or mailing address from which additional information concerning the transaction is available.

(2) "Request" means a record:

(A) Signed by a debtor or consumer obligor;

(B) Requesting that the recipient provide an explanation; and

(C) Sent after disposition of the collateral under § 57A-9-610 .

(b) In a consumer - goods transaction in which the debtor is entitled to a surplus or a consumer obligor is liable for a deficiency under § 57A-9-615 , the secured party shall:

(1) Send an explanation to the debtor or consumer obligor, as applicable, after the disposition and:

(A) Before or when the secured party accounts to the debtor and pays any surplus or first makes demand in a record on the consumer obligor after the disposition for payment of the deficiency; and

(B) Within fourteen days after receipt of a request; or

(2) In the case of a consumer obligor who is liable for a deficiency, within fourteen days after receipt of a request, send to the consumer obligor a record waiving the secured party's right to a deficiency.

(c) To comply with subsection (a)(1)(B), an explanation must provide the following information in the following order:

(1) The aggregate amount of obligations secured by the security interest under which the disposition was made, and, if the amount reflects a rebate of unearned interest or credit service charge, an indication of that fact, calculated as of a specified date:

(A) If the secured party takes or receives possession of the collateral after default, not more than thirty - five days before the secured party takes or receives possession; or

(B) If the secured party takes or receives possession of the collateral before default or does not take possession of the collateral, not more than thirty - five days before the disposition;

(2) The amount of proceeds of the disposition;

(3) The aggregate amount of the obligations after deducting the amount of proceeds;

(4) The amount, in the aggregate or by type, and types of expenses, including expenses of retaking, holding, preparing for disposition, processing, and disposing of the collateral, and attorney's fees secured by the collateral which are known to the secured party and relate to the current disposition;

(5) The amount, in the aggregate or by type, and types of credits, including rebates of interest or credit service charges, to which the obligor is known to be entitled and which are not reflected in the amount in paragraph (1); and

(6) The amount of the surplus or deficiency.

(d) A particular phrasing of the explanation is not required. An explanation complying substantially with the requirements of subsection (a) is sufficient, even if it includes minor errors that are not seriously misleading.

(e) A debtor or consumer obligor is entitled without charge to one response to a request under this section during any six - month period in which the secured party did not send to the debtor or consumer obligor an explanation pursuant to subsection (b)(1). The secured party may require payment of a charge not exceeding twenty - five dollars for each additional response.

Source: SL 2000, ch 231; SL 2024, ch 198, § 87.
S.D. Codified Laws § 57A-3-305 — SD Code / Title 57A / Chapter 3 / Section 57A-3-305
Defenses and claims in recoupment
Status: in_force

(a) Except as stated in subsection (b), the right to enforce the obligation of a party to pay an instrument is subject to the following:

(1) A defense of the obligor based on (i) infancy of the obligor to the extent it is a defense to a simple contract, (ii) duress, lack of legal capacity, or illegality of the transaction which, under other law, nullifies the obligation of the obligor, (iii) fraud that induced the obligor to sign the instrument with neither knowledge nor reasonable opportunity to learn of its character or its essential terms, or (iv) discharge of the obligor in insolvency proceedings;

(2) A defense of the obligor stated in another section of this article or a defense of the obligor that would be available if the person entitled to enforce the instrument were enforcing a right to payment under a simple contract; and

(3) A claim in recoupment of the obligor against the original payee of the instrument if the claim arose from the transaction that gave rise to the instrument; but the claim of the obligor may be asserted against a transferee of the instrument only to reduce the amount owing on the instrument at the time the action is brought.

(b) The right of a holder in due course to enforce the obligation of a party to pay the instrument is subject to defenses of the obligor stated in subsection (a)(1), but is not subject to defenses of the obligor stated in subsection (a)(2) or claims in recoupment stated in subsection (a)(3) against a person other than the holder.

(c) Except as stated in subsection (d), in an action to enforce the obligation of a party to pay the instrument, the obligor may not assert against the person entitled to enforce the instrument a defense, claim in recoupment, or claim to the instrument (§ 57A-3-306 ) of another person, but the other person's claim to the instrument may be asserted by the obligor if the other person is joined in the action and personally asserts the claim against the person entitled to enforce the instrument. An obligor is not obliged to pay the instrument if the person seeking enforcement of the instrument does not have rights of a holder in due course and the obligor proves that the instrument is a lost or stolen instrument.

(d) In an action to enforce the obligation of an accommodation party to pay an instrument, the accommodation party may assert against the person entitled to enforce the instrument any defense or claim in recoupment under subsection (a) that the accommodated party could assert against the person entitled to enforce the instrument, except the defenses of discharge in insolvency proceedings, infancy, and lack of legal capacity.

Source: SL 1994, ch 367, § 3-305.
S.D. Codified Laws § 57A-9-612 — SD Code / Title 57A / Chapter 9 / Section 57A-9-612
Reasonable time for sending notification
Status: in_force

(a) Except as otherwise provided in subsection (b), whether a notification is sent within a reasonable time is a question of fact.

(b) In a transaction other than a consumer transaction, a notification of disposition sent after default and ten days or more before the earliest time of disposition set forth in the notification is sent within a reasonable time before the disposition.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-4A-206 — SD Code / Title 57A / Chapter 4A / Section 57A-4A-206
Transmission of payment order through funds-transfer or other communication system
Status: in_force

(a) If a payment order addressed to a receiving bank is transmitted to a funds - transfer system or other third - party communication system for transmittal to the bank, the system is deemed to be an agent of the sender for the purpose of transmitting the payment order to the bank. If there is a discrepancy between the terms of the payment order transmitted to the system and the terms of the payment order transmitted by the system to the bank, the terms of the payment order of the sender are those transmitted by the system. This section does not apply to a funds - transfer system of the federal reserve banks.

(b) This section applies to cancellations and amendments of payment orders to the same extent it applies to payment orders.

Source: SL 1991, ch 397, § 1.
S.D. Codified Laws § 57A-9-615 — SD Code / Title 57A / Chapter 9 / Section 57A-9-615
Application of proceeds of disposition--Liability for deficiency and right to surplus
Status: in_force

(a) A secured party shall apply or pay over for application the cash proceeds of disposition under § 57A-9-610 in the following order to:

(1) The reasonable expenses of retaking, holding, preparing for disposition, processing, and disposing, and, to the extent provided for by agreement and not prohibited by law, reasonable attorney's fees and legal expenses incurred by the secured party;

(2) The satisfaction of obligations secured by the security interest or agricultural lien under which the disposition is made;

(3) The satisfaction of obligations secured by any subordinate security interest in or other subordinate lien on the collateral if:

(A) The secured party receives from the holder of the subordinate security interest or other lien a signed demand for proceeds before distribution of the proceeds is completed; and

(B) In a case in which a consignor has an interest in the collateral, the subordinate security interest or other lien is senior to the interest of the consignor; and

(4) A secured party that is a consignor of the collateral if the secured party receives from the consignor a signed demand for proceeds before distribution of the proceeds is completed.

(b) If requested by a secured party, a holder of a subordinate security interest or other lien shall furnish reasonable proof of the interest or lien within a reasonable time. Unless the holder does so, the secured party need not comply with the holder's demand under subsection (a)(3).

(c) A secured party need not apply or pay over for application noncash proceeds of disposition under § 57A-9-610 unless the failure to do so would be commercially unreasonable. A secured party that applies or pays over for application noncash proceeds shall do so in a commercially reasonable manner.

(d) If the security interest under which a disposition is made secures payment or performance of an obligation, after making the payments and applications required by subsection (a) and permitted by subsection (c):

(1) Unless subsection (a)(4) requires the secured party to apply or pay over cash proceeds to a consignor, the secured party shall account to and pay a debtor for any surplus; and

(2) The obligor is liable for any deficiency.

(e) If the underlying transaction is a sale of accounts, chattel paper, payment intangibles, or promissory notes:

(1) The debtor is not entitled to any surplus; and

(2) The obligor is not liable for any deficiency.

(f) The surplus or deficiency following a disposition is calculated based on the amount of proceeds that would have been realized in a disposition complying with this part to a transferee other than the secured party, a person related to the secured party, or a secondary obligor if:

(1) The transferee in the disposition is the secured party, a person related to the secured party, or a secondary obligor; and

(2) The amount of proceeds of the disposition is significantly below the range of proceeds that a complying disposition to a person other than the secured party, a person related to the secured party, or a secondary obligor would have brought.

(g) A secured party that receives cash proceeds of a disposition in good faith and without knowledge that the receipt violates the rights of the holder of a security interest or other lien that is not subordinate to the security interest or agricultural lien under which the disposition is made:

(1) Takes the cash proceeds free of the security interest or other lien;

(2) Is not obligated to apply the proceeds of the disposition to the satisfaction of obligations secured by the security interest or other lien; and

(3) Is not obligated to account to or pay the holder of the security interest or other lien for any surplus.

Source: SL 2000, ch 231; SL 2024, ch 198, § 86.
S.D. Codified Laws § 57A-1-308 — SD Code / Title 57A / Chapter 1 / Section 57A-1-308
Performance or acceptance under reservation of rights
Status: in_force

(a) A party that with explicit reservation of rights performs or promises performance or assents to performance in a manner demanded or offered by the other party does not thereby prejudice the rights reserved. Such words as "without prejudice," "under protest," or the like are sufficient.

(b) Subsection (a) does not apply to an accord and satisfaction.

Source: SL 2008, ch 259, § 22.
S.D. Codified Laws § 57A-11-103 — SD Code / Title 57A / Chapter 11 / Section 57A-11-103
Transition to 1983 Act--General rule
Status: in_force

Transactions validly entered into after the dates set by § 57A-10-101 and before July 1, 1983, and which were subject to the provisions of Title 57A and which would be subject to this 1983 Act as amended if they had been entered into after July 1, 1983 and the rights, duties and interests flowing from such transactions remain valid after the latter date and may be terminated, completed, consummated or enforced as required or permitted by this 1983 Act. Security interests arising out of such transactions which are perfected when this 1983 Act becomes effective shall remain perfected until they lapse as provided in this 1983 Act, and may be continued as permitted by this 1983 Act, except as stated in § 57A-11-105 .

Source: SDCL, § 57A-11-103 , enacted by SL 1982, ch 347, § 38; SL 1983, ch 367, § 7.
S.D. Codified Laws § 57A-8-106 — SD Code / Title 57A / Chapter 8 / Section 57A-8-106
Control
Status: in_force

(a) A purchaser has "control" of a certificated security in bearer form if the certificated security is delivered to the purchaser.

(b) A purchaser has "control" of a certificated security in registered form if the certificated security is delivered to the purchaser, and:

(1) The certificate is indorsed to the purchaser or in blank by an effective indorsement; or

(2) The certificate is registered in the name of the purchaser, upon original issue or registration of transfer by the issuer.

(c) A purchaser has "control" of an uncertificated security if:

(1) The uncertificated security is delivered to the purchaser; or

(2) The issuer has agreed that it will comply with instructions originated by the purchaser without further consent by the registered owner.

(d) A purchaser has "control" of a security entitlement if:

(1) The purchaser becomes the entitlement holder; or

(2) The securities intermediary has agreed that it will comply with entitlement orders originated by the purchaser without further consent by the entitlement holder; or

(3) Another person, other than the transferor to the purchaser of an interest in the security entitlement:

(A) Has control of the security entitlement and acknowledges that it has control on behalf of the purchaser; or

(B) Obtains control of the security entitlement after having acknowledged that it will obtain control of the security entitlement on behalf of the purchaser.

(e) If an interest in a security entitlement is granted by the entitlement holder to the entitlement holder's own securities intermediary, the securities intermediary has control.

(f) A purchaser who has satisfied the requirements of subsection (c) or (d) has control, even if the registered owner in the case of subsection (c) or the entitlement holder in the case of subsection (d) retains the right to make substitutions for the uncertificated security or security entitlement, to originate instructions or entitlement orders to the issuer or securities intermediary, or otherwise to deal with the uncertificated security or security entitlement.

(g) An issuer or a securities intermediary may not enter into an agreement of the kind described in subsection (c)(2) or (d)(2) without the consent of the registered owner or entitlement holder, but an issuer or a securities intermediary is not required to enter into such an agreement even though the registered owner or entitlement holder so directs. An issuer or securities intermediary that has entered into such an agreement is not required to confirm the existence of the agreement to another party unless requested to do so by the registered owner or entitlement holder.

(h) A person that has control under this section is not required to acknowledge that it has control on behalf of a purchaser.

(i) If a person acknowledges that it has or will obtain control on behalf of a purchaser, unless the person otherwise agrees or law other than this chapter or chapter 57A-9 otherwise provides, the person does not owe any duty to the purchaser and is not required to confirm the acknowledgement to any other person.

Source: SL 1998, ch 284, § 1; SL 2000, ch 231, § 15; SL 2024, ch 198, § 40.
S.D. Codified Laws § 57A-9-303 — SD Code / Title 57A / Chapter 9 / Section 57A-9-303
Law governing perfection and priority issues relating to goods covered by a certificate of title
Status: in_force

(a) This section applies to goods covered by a certificate of title, even if there is no other relationship between the jurisdiction under whose certificate of title the goods are covered and the goods or the debtor.

(b) Goods become covered by a certificate of title when a valid application for the certificate of title and the applicable fee are delivered to the appropriate authority. Goods cease to be covered by a certificate of title at the earlier of the time the certificate of title ceases to be effective under the law of the issuing jurisdiction or the time the goods become covered subsequently by a certificate of title issued by another jurisdiction.

(c) The local law of the jurisdiction under whose certificate of title the goods are covered governs perfection, the effect of perfection or nonperfection, and the priority of a security interest in goods covered by a certificate of title from the time the goods become covered by the certificate of title until the goods cease to be covered by the certificate of title.

(d) A security interest in a snowmobile which attached prior to July 1, 1991, may be perfected by notation on the certificate of title under chapter 32-3 or in accordance with the provisions of chapter 57A-9 .

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-2-601 — SD Code / Title 57A / Chapter 2 / Section 57A-2-601
Buyer's rights on improper delivery
Status: in_force

Subject to the provisions of this chapter on breach in installment contracts (§ 57A-2-612 ) and unless otherwise agreed under the sections on contractual limitations of remedy (§§ 57A-2-718 and 57A-2-719 ), if the goods or the tender of delivery fail in any respect to conform to the contract, the buyer may

(a) Reject the whole; or

(b) Accept the whole; or

(c) Accept any commercial unit or units and reject the rest.

Source: SL 1966, ch 150, § 2-601; SDCL, § 57-7-1.
S.D. Codified Laws § 57A-3A-105 — SD Code / Title 57A / Chapter 3A / Section 57A-3A-105
Assignee's liability restricted to amount owed--Defense or setoff
Status: in_force

The assignee's liability under this part may not exceed the amount owing to the assignee at the time the defense is asserted against the assignee, and the rights of the retail buyer can only be asserted as a matter of defense to or setoff against a claim by the assignee.

Source: SL 1973, ch 295, § 3; SDCL Supp, § 57-10A-5.
S.D. Codified Laws § 57A-5-116 — SD Code / Title 57A / Chapter 5 / Section 57A-5-116
Choice of law and forum
Status: in_force

(a) The liability of an issuer, nominated person, or adviser for action or omission is governed by the law of the jurisdiction chosen by an agreement in the form of a record signed by the affected parties or by a provision in the person's letter of credit, confirmation, or other undertaking. The jurisdiction whose law is chosen need not bear any relation to the transaction.

(b) Unless subsection (a) applies, the liability of an issuer, nominated person, or adviser for action or omission is governed by the law of the jurisdiction in which the person is located. The person is considered to be located at the address indicated in the person's undertaking. If more than one address is indicated, the person is considered to be located at the address from which the person's undertaking was issued.

(c) For the purpose of jurisdiction, choice of law, and recognition of interbranch letters of credit, but not enforcement of a judgment, all branches of a bank are considered separate juridical entities and a bank is considered to be located at the place where its relevant branch is considered to be located under subsection (d).

(d) A branch of a bank is considered to be located at the address indicated in the branch's undertaking. If more than one address is indicated, the branch is considered to be located at the address from which the undertaking was issued.

(e) Except as otherwise provided in this subsection, the liability of an issuer, nominated person, or adviser is governed by any rules of custom or practice, such as the Uniform Customs and Practice for Documentary Credits, to which the letter of credit, confirmation, or other undertaking is expressly made subject. If (i) this chapter would govern the liability of an issuer, nominated person, or adviser under subsection (a) or (b), (ii) the relevant undertaking incorporates rules of custom or practice, and (iii) there is conflict between this chapter and those rules as applied to that undertaking, those rules govern except to the extent of any conflict with the nonvariable provisions specified in § 57A-5-103 (c).

(f) If there is conflict between this chapter and chapter 57A-3 , 57A-4 , 57A-4A , or 57A-9 , this chapter governs.

(g) The forum for settling disputes arising out of an undertaking within this chapter may be chosen in the manner and with the binding effect that governing law may be chosen in accordance with subsection (a).

Source: SL 1998, ch 283, § 1; SL 2024, ch 198, § 35.
S.D. Codified Laws § 57A-2-715 — SD Code / Title 57A / Chapter 2 / Section 57A-2-715
Buyer's incidental and consequential damages
Status: in_force

(1) Incidental damages resulting from the seller's breach include expenses reasonably incurred in inspection, receipt, transportation and care and custody of goods rightfully rejected, any commercially reasonable charges, expenses or commissions in connection with effecting cover and any other reasonable expense incident to the delay or other breach.

(2) Consequential damages resulting from the seller's breach include:

(a) Any loss resulting from general or particular requirements and needs of which the seller at the time of contracting had reason to know and which could not reasonably be prevented by cover or otherwise; and

(b) Injury to person or property proximately resulting from any breach of warranty.

Source: SL 1966, ch 150, § 2-715; SDCL, §§ 57-8-39, 57-8-40.
S.D. Codified Laws § 57A-8-305 — SD Code / Title 57A / Chapter 8 / Section 57A-8-305
Instruction
Status: in_force

(a) If an instruction has been originated by an appropriate person but is incomplete in any other respect, any person may complete it as authorized and the issuer may rely on it as completed, even though it has been completed incorrectly.

(b) Unless otherwise agreed, a person initiating an instruction assumes only the obligations imposed by § 57A-8-108 and not an obligation that the security will be honored by the issuer.

Source: SL 1998, ch 284, § 1.
S.D. Codified Laws § 57A-4-110 — SD Code / Title 57A / Chapter 4 / Section 57A-4-110
Electronic presentment
Status: in_force

(a) "Agreement for electronic presentment" means an agreement, clearing - house rule, or federal reserve regulation or operating circular, providing that presentment of an item may be made by transmission of an image of an item or information describing the item "presentment notice" rather than delivery of the item itself. The agreement may provide for procedures governing retention, presentment, payment, dishonor, and other matters concerning items subject to the agreement.

(b) Presentment of an item pursuant to an agreement for presentment is made when the presentment notice is received.

(c) If presentment is made by presentment notice, a reference to "item" or "check" in this chapter means the presentment notice unless the context otherwise indicates.

Source: SL 1994, ch 368, § 4-110.
S.D. Codified Laws § 57A-4A-502 — SD Code / Title 57A / Chapter 4A / Section 57A-4A-502
Creditor process served on receiving bank--Setoff by beneficiary's bank
Status: in_force

(a) As used in this section, "creditor process" means levy, attachment, garnishment, notice of a lien, sequestration or similar process issued by or on behalf of a creditor or other claimant with respect to an account.

(b) This subsection applies to creditor process with respect to an authorized account of the sender of a payment order if the creditor process is served on the receiving bank. For the purpose of determining rights with respect to the creditor process, if the receiving bank accepts the payment order the balance in the authorized account is deemed to be reduced by the amount of the payment order to the extent the bank did not otherwise receive payment of the order, unless the creditor process is served at a time and in a manner affording the bank a reasonable opportunity to act on it before the bank accepts the payment order.

(c) If a beneficiary's bank has received a payment order for payment to the beneficiary's account in the bank, the following rules apply:

(1) The bank may credit the beneficiary's account. The amount credited may be set off against an obligation owed by the beneficiary to the bank or may be applied to satisfy creditor process served on the bank with respect to the account.

(2) The bank may credit the beneficiary's account and allow withdrawal of the amount credited unless creditor process with respect to the account is served at a time and in a manner affording the bank a reasonable opportunity to act to prevent withdrawal.

(3) If creditor process with respect to the beneficiary's account has been served and the bank has had a reasonable opportunity to act on it, the bank may not reject the payment order except for a reason unrelated to the service of process.

(d) Creditor process with respect to a payment by the originator to the beneficiary pursuant to a funds transfer may be served only on the beneficiary's bank with respect to the debt owed by that bank to the beneficiary. Any other bank served with the creditor process is not obliged to act with respect to the process.

Source: SL 1991, ch 397, § 1.
S.D. Codified Laws § 57A-2-321 — SD Code / Title 57A / Chapter 2 / Section 57A-2-321
C.I.F. or C. & F.--"Net landed weights"--"Payment on arrival"--Warranty of condition on arrival
Status: in_force

Under a contract containing a term C.I.F. or C. & F.

(1) Where the price is based on or is to be adjusted according to "net landed weights," "delivered weights," "out turn" quantity or quality or the like, unless otherwise agreed the seller must reasonably estimate the price. The payment due on tender of the documents called for by the contract is the amount so estimated, but after final adjustment of the price a settlement must be made with commercial promptness.

(2) An agreement described in subsection (1) or any warranty of quality or condition of the goods on arrival places upon the seller the risk of ordinary deterioration, shrinkage and the like in transportation but has no effect on the place or time of identification to the contract for sale or delivery or on the passing of the risk of loss.

(3) Unless otherwise agreed where the contract provides for payment on or after arrival of the goods the seller must before payment allow such preliminary inspection as is feasible; but if the goods are lost delivery of the documents and payment are due when the goods should have arrived.

Source: SL 1966, ch 150, § 2-321; SDCL, §§ 57-4-50 to 57-4-52.
S.D. Codified Laws § 57A-4-203 — SD Code / Title 57A / Chapter 4 / Section 57A-4-203
Effect of instructions
Status: in_force

Subject to chapter 57A-3 concerning conversion of instruments (§ 57A-3-420 ) and restrictive endorsements (§ 57A-3-206 ), only a collecting bank's transferor can give instructions that affect the bank or constitute notice to it, and a collecting bank is not liable to prior parties for any action taken pursuant to the instructions or in accordance with any agreement with its transferor.

Source: SL 1994, ch 368, § 4-203.
S.D. Codified Laws § 57A-2-309 — SD Code / Title 57A / Chapter 2 / Section 57A-2-309
Absence of specific time provisions--Notice of termination
Status: in_force

(1) The time for shipment or delivery or any other action under a contract if not provided in this chapter or agreed upon shall be a reasonable time.

(2) Where the contract provides for successive performances but is indefinite in duration it is valid for a reasonable time but unless otherwise agreed may be terminated at any time by either party.

(3) Termination of a contract by one party except on the happening of an agreed event requires that reasonable notification be received by the other party and an agreement dispensing with notification is invalid if its operation would be unconscionable.

Source: SL 1966, ch 150, § 2-309; SDCL, §§ 57-4-15 to 57-4-17.