S.D. Codified Laws § 57A-2A-508 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-508
Lessee's remedies
Status: in_force

(1) If a lessor fails to deliver the goods in conformity to the lease contract (§ 57A-2A-509 ) or repudiates the lease contract (§ 57A-2A-402 ), or a lessee rightfully rejects the goods (§ 57A-2A-509 ) or justifiably revokes acceptance of the goods (§ 57A-2A-517 ), then with respect to any goods involved, and with respect to all of the goods if under an installment lease contract the value of the whole lease contract is substantially impaired (§ 57A-2A-510 ), the lessor is in default under the lease contract and the lessee may:

(a) Cancel the lease contract (§ 57A-2A-505(1));

(b) Recover so much of the rent and security as has been paid, but in the case of an installment lease contract the recovery is that which is just under the circumstances;

(c) Cover and recover damages as to all goods affected whether or not they have been identified to the lease contract (§§ 57A-2A-518 and 57A-2A-520 ), or recover damages for nondelivery (§§ 57A-2A-519 and 57A-2A-520 ).

(2) If a lessor fails to deliver the goods in conformity to the lease contract or repudiates the lease contract, the lessee may also:

(a) If the goods have been identified, recover them (§ 57A-2A-522 ); or

(b) In a proper case, obtain specific performance or replevy the goods (§ 57A-2A-521 ).

(3) If a lessor is otherwise in default under a lease contract, the lessee may exercise the rights and remedies provided in this chapter except to the extent that this chapter makes the right or remedy available only upon the occurrence of a default described in subsection (1) or (2).

(4) If a lessor has breached a warranty, whether express or implied, the lessee may recover damages (§ 57A-2A-519(4)).

(5) On rightful rejection or justifiable revocation of acceptance, a lessee has a security interest in goods in the lessee's possession or control for any rent and security that has been paid and any expenses reasonably incurred in their inspection, receipt, transportation and care and custody and may hold those goods and dispose of them in good faith and in a commercially reasonable manner, subject to the provisions of § 57A-2A-527(5).

(6) Subject to the provisions of § 57A-2A-407 , a lessee, on notifying the lessor of the lessee's intention to do so, may deduct all or any part of the damages resulting from any default under the lease contract from any part of the rent still due under the same lease contract.

Source: SL 1989, ch 419, § 1; SL 1990, ch 390, § 17.
S.D. Codified Laws § 57A-2-304 — SD Code / Title 57A / Chapter 2 / Section 57A-2-304
Price payable in money, goods, realty, or otherwise
Status: in_force

(1) The price can be made payable in money or otherwise. If it is payable in whole or in part in goods each party is a seller of the goods which he is to transfer.

(2) Even though all or part of the price is payable in an interest in realty the transfer of the goods and the seller's obligations with reference to them are subject to this chapter, but not the transfer of the interest in realty or the transferor's obligations in connection therewith.

Source: SL 1966, ch 150, § 2-304; SDCL, §§ 57-4-5, 57-4-6.
S.D. Codified Laws § 57A-3-418 — SD Code / Title 57A / Chapter 3 / Section 57A-3-418
Payment or acceptance by mistake
Status: in_force

(a) Except as provided in subsection (c), if the drawee of a draft pays or accepts the draft and the drawee acted on the mistaken belief that (i) payment of the draft had not been stopped pursuant to § 57A-4-403 or (ii) the signature of the drawer of the draft was authorized, the drawee may recover the amount of the draft from the person to whom or for whose benefit payment was made or, in the case of acceptance, may revoke the acceptance. Rights of the drawee under this subsection are not affected by failure of the drawee to exercise ordinary care in paying or accepting the draft.

(b) Except as provided in subsection (c), if an instrument has been paid or accepted by mistake and the case is not covered by subsection (a), the person paying or accepting may, to the extent permitted by the law governing mistake and restitution, (i) recover the payment from the person to whom or for whose benefit payment was made or (ii) in the case of acceptance, may revoke the acceptance.

(c) The remedies provided by subsection (a) or (b) may not be asserted against a person who took the instrument in good faith and for value or who in good faith changed position in reliance on the payment or acceptance. This subsection does not limit remedies provided by § 57A-3-417 or 57A-4-407 .

(d) Notwithstanding § 57A-4-215 , if an instrument is paid or accepted by mistake and the payor or acceptor recovers payment or revokes acceptance under subsection (a) or (b), the instrument is deemed not to have been paid or accepted and is treated as dishonored, and the person from whom payment is recovered has rights as a person entitled to enforce the dishonored instrument.

Source: SL 1994, ch 367, § 3-418.
S.D. Codified Laws § 57A-3-419 — SD Code / Title 57A / Chapter 3 / Section 57A-3-419
Instruments signed for accommodation
Status: in_force

(a) If an instrument is issued for value given for the benefit of a party to the instrument ("accommodated party") and another party to the instrument ("accommodation party") signs the instrument for the purpose of incurring liability on the instrument without being a direct beneficiary of the value given for the instrument, the instrument is signed by the accommodation party "for accommodation."

(b) An accommodation party may sign the instrument as maker, drawer, acceptor, or indorser and, subject to subsection (d), is obliged to pay the instrument in the capacity in which the accommodation party signs. The obligation of an accommodation party may be enforced notwithstanding any statute of frauds and whether or not the accommodation party receives consideration for the accommodation.

(c) A person signing an instrument is presumed to be an accommodation party and there is notice that the instrument is signed for accommodation if the signature is an anomalous indorsement or is accompanied by words indicating that the signer is acting as surety or guarantor with respect to the obligation of another party to the instrument. Except as provided in § 57A-3-605 , the obligation of an accommodation party to pay the instrument is not affected by the fact that the person enforcing the obligation had notice when the instrument was taken by that person that the accommodation party signed the instrument for accommodation.

(d) If the signature of a party to an instrument is accompanied by words indicating unambiguously that the party is guaranteeing collection rather than payment of the obligation of another party to the instrument, the signer is obliged to pay the amount due on the instrument to a person entitled to enforce the instrument only if (i) execution of judgment against the other party has been returned unsatisfied, (ii) the other party is insolvent or in an insolvency proceeding, (iii) the other party cannot be served with process, or (iv) it is otherwise apparent that payment cannot be obtained from the other party.

(e) An accommodation party who pays the instrument is entitled to reimbursement from the accommodated party and is entitled to enforce the instrument against the accommodated party. An accommodated party who pays the instrument has no right of recourse against, and is not entitled to contribution from, an accommodation party.

Source: SL 1994, ch 367, § 3-419.
S.D. Codified Laws § 57A-8-603 — SD Code / Title 57A / Chapter 8 / Section 57A-8-603
Savings clause
Status: in_force

(a) This chapter does not affect an action or proceeding commenced before this chapter takes effect.

(b) If a security interest in a security is perfected at the date this chapter takes effect, and the action by which the security interest was perfected would suffice to perfect a security interest under this chapter, no further action is required to continue perfection. If a security interest in a security is perfected at the date this chapter takes effect but the action by which the security interest was perfected would not suffice to perfect a security interest under this chapter, the security interest remains perfected for a period of four months after the effective date and continues perfected thereafter if appropriate action to perfect under this chapter is taken within that period. If a security interest is perfected at the date this chapter takes effect and the security interest can be perfected by filing under this chapter, a financing statement signed by the secured party instead of the debtor may be filed within that period to continue perfection or thereafter to perfect.

Source: SL 1998, ch 284, § 1.
S.D. Codified Laws § 57A-4A-107 — SD Code / Title 57A / Chapter 4A / Section 57A-4A-107
Federal reserve regulations and operating circulars
Status: in_force

Regulations of the board of governors of the federal reserve system and operating circulars of the federal reserve banks supersede any inconsistent provision of this chapter to the extent of the inconsistency.

Source: SL 1991, ch 397, § 1.
S.D. Codified Laws § 57A-9-305 — SD Code / Title 57A / Chapter 9 / Section 57A-9-305
Law governing perfection and priority of security interests in investment property
Status: in_force

(a) Except as otherwise provided in subsection (c), the following rules apply:

(1) While a security certificate is located in a jurisdiction, the local law of that jurisdiction governs perfection, the effect of perfection or nonperfection, and the priority of a security interest in the certificated security represented thereby.

(2) The local law of the issuer's jurisdiction as specified in § 57A-8-110 (d) governs perfection, the effect of perfection or nonperfection, and the priority of a security interest in an uncertificated security.

(3) The local law of the securities intermediary's jurisdiction as specified in § 57A-8-110 (e) governs perfection, the effect of perfection or nonperfection, and the priority of a security interest in a security entitlement or securities account.

(4) The local law of the commodity intermediary's jurisdiction governs perfection, the effect of perfection or nonperfection, and the priority of a security interest in a commodity contract or commodity account.

(5) Paragraphs (2), (3), and (4) apply even if the transaction does not bear any relation to the jurisdiction.

(b) The following rules determine a commodity intermediary's jurisdiction for purposes of this part:

(1) If an agreement between the commodity intermediary and commodity customer governing the commodity account expressly provides that a particular jurisdiction is the commodity intermediary's jurisdiction for purposes of this part, this chapter, or the Uniform Commercial Code, that jurisdiction is the commodity intermediary's jurisdiction.

(2) If paragraph (1) does not apply and an agreement between the commodity intermediary and commodity customer governing the commodity account expressly provides that the agreement is governed by the law of a particular jurisdiction, that jurisdiction is the commodity intermediary's jurisdiction.

(3) If neither paragraph (1) nor paragraph (2) applies and an agreement between the commodity intermediary and commodity customer governing the commodity account expressly provides that the commodity account is maintained at an office in a particular jurisdiction, that jurisdiction is the commodity intermediary's jurisdiction.

(4) If none of the preceding paragraphs applies, the commodity intermediary's jurisdiction is the jurisdiction in which the office identified in an account statement as the office serving the commodity customer's account is located.

(5) If none of the preceding paragraphs applies, the commodity intermediary's jurisdiction is the jurisdiction in which the chief executive office of the commodity intermediary is located.

(c) The local law of the jurisdiction in which the debtor is located governs:

(1) perfection of a security interest in investment property by filing;

(2) automatic perfection of a security interest in investment property created by a broker or securities intermediary; and

(3) automatic perfection of a security interest in a commodity contract or commodity account created by a commodity intermediary.

Source: SL 2000, ch 231; SL 2024, ch 198, § 57.
S.D. Codified Laws § 57A-9-337 — SD Code / Title 57A / Chapter 9 / Section 57A-9-337
Certificate of title failing to show security interest perfected under another jurisdiction's law
Status: in_force

If, while a security interest in goods is perfected by any method under the law of another jurisdiction, this State issues a certificate of title that does not show that the goods are subject to the security interest or contain a statement that they may be subject to security interests not shown on the certificate:

(1) A buyer of the goods, other than a person in the business of selling goods of that kind, takes free of the security interest if the buyer gives value and receives delivery of the goods after issuance of the certificate and without knowledge of the security interest; and

(2) The security interest is subordinate to a conflicting security interest in the goods that attaches, and is perfected under § 57A-9-311(b), after issuance of the certificate and without the conflicting secured party's knowledge of the security interest.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-9-523 — SD Code / Title 57A / Chapter 9 / Section 57A-9-523
Acknowledgment of filing--Information to be communicated from records on request--Sale or licensing of records
Status: in_force

(a) If a person that files a written record requests an acknowledgment of the filing, the filing office shall send to the person an image of the record showing the number assigned to the record pursuant to § 57A-9-519(a)(1) and the date and time of the filing of the record. However, if the person furnishes a copy of the record to the filing office, the filing office may instead:

(1) Note upon the copy the number assigned to the record pursuant to § 57A-9-519(a)(1) and the date and time of the filing of the record; and

(2) Send the copy to the person.

(b) If a person files a record other than a written record, the filing office shall communicate to the person an acknowledgment that provides:

(1) The information in the record;

(2) The number assigned to the record pursuant to § 57A-9-519(a)(1); and

(3) The date and time of the filing of the record.

(c) The filing office shall communicate or otherwise make available in a record the following information to any person that requests it:

(1) Whether there is on file on a date and time specified by the filing office, but not a date earlier than three business days before the filing office receives the request, any financing statement that:

(A) Designates a particular debtor or, if the request so states, designates a particular debtor at the address specified in the request;

(B) Has not lapsed under § 57A-9-515 with respect to all secured parties of record; and

(C) If the request so states, has lapsed under § 57A-9-515 and a record of which is maintained by the filing office under § 57A-9-522(a);

(2) The date and time of filing of each financing statement; and

(3) The information provided in each financing statement. However, if the financing statement contains a social security or employer identification number which has not been supplied by the person requesting the information, such number shall be redacted prior to providing the information. In the case of financing statements recorded in the office of the register of deeds, the requirement for redaction of social security or employer identification numbers only applies to financing statements recorded after July 1, 2009.

(d) In complying with its duty under subsection (c), the filing office may communicate information in any medium. However, if requested, the filing office shall communicate information by issuing a record that can be admitted into evidence in the courts of this state without extrinsic evidence of its authenticity.

A computer printout from the centralized computer system established by the secretary of state constitutes the certificate of the secretary of state as to whether there is on file, on the date and hour stated thereon, a financing statement covering the following collateral: farm products or accounts, or livestock, or general intangibles arising from or relating to the sale of farm products by a farmer, or crops growing or to be grown, or equipment used in farming operations.

The secretary of state shall, upon a telephone request, furnish to any person, company, or corporation, information as to whether a financing statement describing farm collateral has been filed in the Office of the Secretary of State and, if such financing statement has been filed, the secretary of state shall also furnish the name and business address of the secured creditor. However, the secretary of state need not answer telephone inquiries in writing nor send written confirmation from a telephone request. The secretary of state is not responsible for accuracy and completeness of the information furnished verbally in response to a telephone request.

(e) The filing office shall perform the acts required by subsections (a) through (d) at the time and in the manner prescribed by filing-office rule, but not later than two business days after the filing office receives the request.

Source: SL 2000, ch 231; SL 2009, ch 3, § 2; SL 2009, ch 255, § 1.
S.D. Codified Laws § 57A-9-617 — SD Code / Title 57A / Chapter 9 / Section 57A-9-617
Rights of transferee of collateral disposed of after default
Status: in_force

(a) A secured party's disposition of collateral after default:

(1) Transfers to a transferee for value all of the debtor's rights in the collateral;

(2) Discharges the security interest under which the disposition is made; and

(3) Discharges any subordinate security interest or other subordinate lien, other than liens created by law that are not to be discharged.

(b) A transferee that acts in good faith takes free of the rights and interests described in subsection (a), even if the secured party fails to comply with this chapter or the requirements of any judicial proceeding.

(c) If a transferee does not take free of the rights and interests described in subsection (a), the transferee takes the collateral subject to:

(1) The debtor's rights in the collateral;

(2) The security interest or agricultural lien under which the disposition is made; and

(3) Any other security interest or other lien.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-1-306 — SD Code / Title 57A / Chapter 1 / Section 57A-1-306
Waiver or renunciation of claim or right after breach
Status: in_force

A claim or right arising out of an alleged breach may be discharged in whole or in part without consideration by agreement of the aggrieved party in a signed record.

Source: SL 2008, ch 259, § 20; SL 2024, ch 198, § 5.
S.D. Codified Laws § 57A-2A-401 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-401
Insecurity: adequate assurance of performance
Status: in_force

(1) A lease contract imposes an obligation on each party that the other's expectation of receiving due performance will not be impaired.

(2) If reasonable grounds for insecurity arise with respect to the performance of either party, the insecure party may demand in writing adequate assurance of due performance. Until the insecure party receives that assurance, if commercially reasonable the insecure party may suspend any performance for which he has not already received the agreed return.

(3) A repudiation of the lease contract occurs if assurance of due performance adequate under the circumstances of the particular case is not provided to the insecure party within a reasonable time, not to exceed thirty days after receipt of a demand by the other party.

(4) Between merchants, the reasonableness of grounds for insecurity and the adequacy of any assurance offered must be determined according to commercial standards.

(5) Acceptance of any nonconforming delivery or payment does not prejudice the aggrieved party's right to demand adequate assurance of future performance.

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-3-205 — SD Code / Title 57A / Chapter 3 / Section 57A-3-205
Special indorsement--Blank indorsement--Anomalous indorsement
Status: in_force

(a) If an indorsement is made by the holder of an instrument, whether payable to an identified person or payable to bearer, and the indorsement identifies a person to whom it makes the instrument payable, it is a "special indorsement." When specially indorsed, an instrument becomes payable to the identified person and may be negotiated only by the indorsement of that person. The principles stated in § 57A-3-110 apply to special indorsements.

(b) If an indorsement is made by the holder of an instrument and it is not a special indorsement, it is a "blank indorsement." When indorsed in blank, an instrument becomes payable to bearer and may be negotiated by transfer of possession alone until specially indorsed.

(c) The holder may convert a blank indorsement that consists only of a signature into a special indorsement by writing, above the signature of the indorser, words identifying the person to whom the instrument is made payable.

(d) "Anomalous indorsement" means an indorsement made by a person who is not the holder of the instrument. An anomalous indorsement does not affect the manner in which the instrument may be negotiated.

Source: SL 1994, ch 367, § 3-205.
S.D. Codified Laws § 57A-4-107 — SD Code / Title 57A / Chapter 4 / Section 57A-4-107
Separate office of a bank
Status: in_force

A branch or separate office of a bank is a separate bank for the purpose of computing the time within which and determining the place at or to which action may be taken or notices or orders must be given under this chapter and under chapter 57A-3 .

Source: SL 1994, ch 368, § 4-107.
S.D. Codified Laws § 57A-9-107 — SD Code / Title 57A / Chapter 9 / Section 57A-9-107
Control of letter-of-credit right
Status: in_force

A secured party has control of a letter - of - credit right to the extent of any right to payment or performance by the issuer or any nominated person if the issuer or nominated person has consented to an assignment of proceeds of the letter of credit under § 57A-5-114(c) or otherwise applicable law or practice.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-2-323 — SD Code / Title 57A / Chapter 2 / Section 57A-2-323
Form of bill of lading required in overseas shipment--"Overseas"
Status: in_force

(1) Where the contract contemplates overseas shipment and contains a term C.I.F. or C. & F. or F.O.B. vessel, the seller unless otherwise agreed must obtain a negotiable bill of lading stating that the goods have been loaded on board or, in the case of a term C.I.F. or C. & F., received for shipment.

(2) Where in a case within subsection (1) a tangible bill of lading has been issued in a set of parts, unless otherwise agreed if the documents are not to be sent from abroad the buyer may demand tender of the full set; otherwise only one part of the bill of lading need be tendered. Even if the agreement expressly requires a full set:

(a) Due tender of a single part is acceptable within the provisions of this chapter on cure of improper delivery (§ 57A-2-508 ); and

(b) Even though the full set is demanded, if the documents are sent from abroad the person tendering an incomplete set may nevertheless require payment upon furnishing an indemnity which the buyer in good faith deems adequate.

(3) A shipment by water or by air or a contract contemplating such shipment is "overseas" insofar as by usage of trade or agreement it is subject to the commercial, financing or shipping practices characteristic of international deep water commerce.

Source: SL 1966, ch 150, § 2-323; SDCL §§ 57-4-56 to 57-4-58; SL 2009, ch 254, § 809.
S.D. Codified Laws § 57A-5-115 — SD Code / Title 57A / Chapter 5 / Section 57A-5-115
Statute of limitations
Status: in_force

An action to enforce a right or obligation arising under this chapter must be commenced within one year after the expiration date of the relevant letter of credit or one year after the cause of action accrues, whichever occurs later. A cause of action accrues when the breach occurs, regardless of the aggrieved party's lack of knowledge of the breach.

Source: SL 1998, ch 283, § 1.
S.D. Codified Laws § 57A-8-303 — SD Code / Title 57A / Chapter 8 / Section 57A-8-303
Protected purchaser
Status: in_force

(a) "Protected purchaser" means a purchaser of a certificated or uncertificated security, or of an interest therein, who:

(1) Gives value;

(2) Does not have notice of any adverse claim to the security; and

(3) Obtains control of the certificated or uncertificated security.

(b) A protected purchaser also acquires its interest in the security free of any adverse claim.

Source: SL 1998, ch 284, § 1; SL 2024, ch 198, § 42.
S.D. Codified Laws § 57A-8-203 — SD Code / Title 57A / Chapter 8 / Section 57A-8-203
Staleness as notice of defect or defense
Status: in_force

After an act or event, other than a call that has been revoked, creating a right to immediate performance of the principal obligation represented by a certificated security or setting a date on or after which the security is to be presented or surrendered for redemption or exchange, a purchaser is charged with notice of any defect in its issue or defense of the issuer, if the act or event:

(1) Requires the payment of money, the delivery of a certificated security, the registration of transfer of an uncertificated security, or any of them on presentation or surrender of the security certificate, the money or security is available on the date set for payment or exchange, and the purchaser takes the security more than one year after that date; or

(2) Is not covered by paragraph (1) and the purchaser takes the security more than two years after the date set for surrender or presentation or the date on which performance became due.

Source: SL 1998, ch 284, § 1.
S.D. Codified Laws § 57A-8-402 — SD Code / Title 57A / Chapter 8 / Section 57A-8-402
Assurance that indorsement or instruction is effective
Status: in_force

(a) An issuer may require the following assurance that each necessary indorsement or each instruction is genuine and authorized:

(1) In all cases, a guaranty of the signature of the person making an indorsement or originating an instruction including, in the case of an instruction, reasonable assurance of identity;

(2) If the indorsement is made or the instruction is originated by an agent, appropriate assurance of actual authority to sign;

(3) If the indorsement is made or the instruction is originated by a fiduciary pursuant to § 57A-8-107(a)(4) or (a)(5), appropriate evidence of appointment or incumbency;

(4) If there is more than one fiduciary, reasonable assurance that all who are required to sign have done so; and

(5) If the indorsement is made or the instruction is originated by a person not covered by another provision of this subsection, assurance appropriate to the case corresponding as nearly as may be to the provisions of this subsection.

(b) An issuer may elect to require reasonable assurance beyond that specified in this section.

(c) In this section:

(1) "Guaranty of the signature" means a guaranty signed by or on behalf of a person reasonably believed by the issuer to be responsible. An issuer may adopt standards with respect to responsibility if they are not manifestly unreasonable.

(2) "Appropriate evidence of appointment or incumbency" means:

(i) In the case of a fiduciary appointed or qualified by a court, a certificate issued by or under the direction or supervision of the court or an officer thereof and dated within sixty days before the date of presentation for transfer; or

(ii) In any other case, a copy of a document showing the appointment or a certificate issued by or on behalf of a person reasonably believed by an issuer to be responsible or, in the absence of that document or certificate, other evidence the issuer reasonably considers appropriate.

Source: SL 1998, ch 284, § 1.
S.D. Codified Laws § 57A-2-101 — SD Code / Title 57A / Chapter 2 / Section 57A-2-101
Short title
Status: in_force

This chapter shall be known and may be cited as Uniform Commercial Code--Sales.

Source: SL 1966, ch 150, § 2-101; SDCL, § 57-2-1.
S.D. Codified Laws § 57A-2-720 — SD Code / Title 57A / Chapter 2 / Section 57A-2-720
Effect of "cancellation" or "rescission" on claims for antecedent breach
Status: in_force

Unless the contrary intention clearly appears, expressions of "cancellation" or "rescission" of the contract or the like shall not be construed as a renunciation or discharge of any claim in damages for an antecedent breach.

Source: SL 1966, ch 150, § 2-720; SDCL, § 57-8-52.
S.D. Codified Laws § 57A-2-701 — SD Code / Title 57A / Chapter 2 / Section 57A-2-701
Remedies for breach of collateral contracts not impaired
Status: in_force

Remedies for breach of any obligation or promise collateral or ancillary to a contract for sale are not impaired by the provisions of this chapter.

Source: SL 1966, ch 150, § 2-701; SDCL, § 57-8-1.
S.D. Codified Laws § 57A-9-329 — SD Code / Title 57A / Chapter 9 / Section 57A-9-329
Priority among conflicting security interests in same letter-of-credit right
Status: in_force

The following rules govern priority among conflicting security interests in the same letter - of - credit right:

(1) A security interest held by a secured party having control of the letter - of - credit right under § 57A-9-107 has priority to the extent of its control over a conflicting security interest held by a secured party that does not have control.

(2) Security interests perfected by control under § 57A-9-314 rank according to priority in time of obtaining control.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-2-722 — SD Code / Title 57A / Chapter 2 / Section 57A-2-722
Who can sue third parties for injury to goods
Status: in_force

Where a third party so deals with goods which have been identified to a contract for sale as to cause actionable injury to a party to that contract

(a) A right of action against the third party is in either party to the contract for sale who has title to or a security interest or a special property or an insurable interest in the goods; and if the goods have been destroyed or converted a right of action is also in the party who either bore the risk of loss under the contract for sale or has since the injury assumed that risk as against the other;

(b) If at the time of the injury the party plaintiff did not bear the risk of loss as against the other party to the contract for sale and there is no arrangement between them for disposition of the recovery, his suit or settlement is, subject to his own interest, as a fiduciary for the other party to the contract;

(c) Either party may with the consent of the other sue for the benefit of whom it may concern.

Source: SL 1966, ch 150, § 2-722; SDCL, §§ 57-8-54 to 57-8-56.
S.D. Codified Laws § 57A-11-106 — SD Code / Title 57A / Chapter 11 / Section 57A-11-106
Required refilings
Status: in_force

(1) If a security interest is perfected or has priority when this 1983 Act takes effect as to all persons or as to certain persons without any filing or recording, and if the filing of a financing statement would be required for the perfection or priority of the security interest against those persons under this 1983 Act, the perfection and priority rights of the security interest continue until three years after July 1, 1983. The perfection will then lapse unless a financing statement is filed as provided in subsection (4) or unless the security interest is perfected otherwise than by filing.

(2) If a security interest is perfected when this 1983 Act takes effect under a law other than the Uniform Commercial Code which requires no further filing, refiling or recording to continue its perfection, perfection continues until and will lapse three years after this 1983 Act takes effect, unless a financing statement is filed as provided in subsection (4) or unless the security interest is perfected otherwise than by filing, or unless under subsection (3) of § 57A-9-302 the other law continues to govern filing.

(3) If a security interest is perfected by a filing, refiling or recording under a law repealed by this 1983 Act which required further filing, refiling or recording to continue its perfection, perfection continues and will lapse on the date provided by the law so repealed for such further filing, refiling or recording unless a financing statement is filed as provided in subsection (4) or unless the security interest is perfected otherwise than by filing.

(4) A financing statement may be filed within six months before the perfection of a security interest would otherwise lapse. Any such financing statement may be signed by either the debtor or the secured party. It must identify the security agreement, statement or notice (however denominated in any statute or other law repealed or modified by this 1983 Act), state the office where and the date when the last filing, refiling or recording, if any, was made with respect thereto, and the filing number, if any, or book and page, if any, of recording and further state that the security agreement, statement or notice, however denominated, in another filing office under the Uniform Commercial Code or under any statute or other law repealed or modified by this 1983 Act is still effective. Sections 57A-9-401 and 57A-9-103 determine the proper place to file such a financing statement. Except as specified in this section, the provisions of § 57A-9-403(3) for continuation statements apply to such a financing statement.

Source: SDCL, § 57A-11-106 , enacted by SL 1982, ch 347, § 38; SL 1983, ch 367, § 7.
S.D. Codified Laws § 57A-9-609 — SD Code / Title 57A / Chapter 9 / Section 57A-9-609
Secured party's rights with respect to collateral following default
Status: in_force

(a) After default, a secured party:

(1) May take possession of the collateral; and

(2) Without removal, may render equipment unusable and dispose of collateral on a debtor's premises under § 57A-9-610 .

(b) A secured party may proceed under subsection (a):

(1) Pursuant to judicial process; or

(2) Without judicial process, if it proceeds without breach of the peace.

(c) If so agreed, and in any event after default, a secured party may require the debtor to assemble the collateral and make it available to the secured party at a place to be designated by the secured party which is reasonably convenient to both parties.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-9-103 — SD Code / Title 57A / Chapter 9 / Section 57A-9-103
Purchase money security interest--Application of payments--Burden of establishing nature of interest
Status: in_force

(a) In this section:

(1) "Purchase - money collateral" means goods or software that secures a purchase - money obligation incurred with respect to that collateral; and

(2) "Purchase - money obligation" means an obligation of an obligor incurred as all or part of the price of the collateral or for value given to enable the debtor to acquire rights in or the use of the collateral if the value is in fact so used.

(b) A security interest in goods is a purchase - money security interest:

(1) To the extent that the goods are purchase - money collateral with respect to that security interest;

(2) If the security interest is in inventory that is or was purchase - money collateral, also to the extent that the security interest secures a purchase - money obligation incurred with respect to other inventory in which the secured party holds or held a purchase - money security interest; and

(3) Also to the extent that the security interest secures a purchase - money obligation incurred with respect to software in which the secured party holds or held a purchase - money security interest.

(c) A security interest in software is a purchase - money security interest to the extent that the security interest also secures a purchase - money obligation incurred with respect to goods in which the secured party holds or held a purchase - money security interest if:

(1) The debtor acquired its interest in the software in an integrated transaction in which it acquired an interest in the goods; and

(2) The debtor acquired its interest in the software for the principal purpose of using the software in the goods.

(d) The security interest of a consignor in goods that are the subject of a consignment is a purchase - money security interest in inventory.

(e) If the extent to which a security interest is a purchase - money security interest depends on the application of a payment to a particular obligation, the payment must be applied:

(1) In accordance with any reasonable method of application to which the parties agree;

(2) In the absence of the parties' agreement to a reasonable method, in accordance with any intention of the obligor manifested at or before the time of payment; or

(3) In the absence of an agreement to a reasonable method and a timely manifestation of the obligor's intention, in the following order:

(A) To obligations that are not secured; and

(B) If more than one obligation is secured, to obligations secured by purchase - money security interests in the order in which those obligations were incurred.

(f) A purchase - money security interest does not lose its status as such, even if:

(1) The purchase - money collateral also secures an obligation that is not a purchase - money obligation;

(2) Collateral that is not purchase - money collateral also secures the purchase - money obligation; or

(3) The purchase - money obligation has been renewed, refinanced, consolidated, or restructured.

(g) A secured party claiming a purchase - money security interest has the burden of establishing the extent to which the security interest is a purchase - money security interest.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-2-724 — SD Code / Title 57A / Chapter 2 / Section 57A-2-724
Admissibility of market quotations
Status: in_force

Whenever the prevailing price or value of any goods regularly bought and sold in any established commodity market is in issue, reports in official publications or trade journals or in newspapers or periodicals of general circulation published as the reports of such market shall be admissible in evidence. The circumstances of the preparation of such a report may be shown to affect its weight but not its admissibility.

Source: SL 1966, ch 150, § 2-724; SDCL, § 57-8-60.
S.D. Codified Laws § 57A-3-413 — SD Code / Title 57A / Chapter 3 / Section 57A-3-413
Obligation of acceptor
Status: in_force

(a) The acceptor of a draft is obliged to pay the draft (i) according to its terms at the time it was accepted, even though the acceptance states that the draft is payable "as originally drawn" or equivalent terms, (ii) if the acceptance varies the terms of the draft, according to the terms of the draft as varied, or (iii) if the acceptance is of a draft that is an incomplete instrument, according to its terms when completed, to the extent stated in §§ 57A-3-115 and 57A-3-407 . The obligation is owed to a person entitled to enforce the draft or to the drawer or an indorser who paid the draft under § 57A-3-414 or 57A-3-415 .

(b) If the certification of a check or other acceptance of a draft states the amount certified or accepted, the obligation of the acceptor is that amount. If (i) the certification or acceptance does not state an amount, (ii) the amount of the instrument is subsequently raised, and (iii) the instrument is then negotiated to a holder in due course, the obligation of the acceptor is the amount of the instrument at the time it was taken by the holder in due course.

Source: SL 1994, ch 367, § 3-413.
S.D. Codified Laws § 57A-2A-528 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-528
Lessor's damages for nonacceptance or repudiation
Status: in_force

(1) Except as otherwise provided with respect to damages liquidated in the lease agreement (§ 57A-2A-504 ) or determined by agreement of the parties (§§ 57A-1-302 and 57A-2A-503 ), if a lessor elects to retain the goods or a lessor elects to dispose of the goods and disposition is by lease agreement, whether or not the lease agreement qualifies for treatment under § 57A-2A-527(2), or is by sale or otherwise, the lessor may recover from the lessee as damages for default by the lessee (§ 57A-2A-523(1)) (a) accrued and unpaid rent as of the date the lessor obtained possession of the goods or such earlier date as the lessee has made an effective tender of possession of the goods back to the lessor, (b) the present value as of the date determined under paragraph (a) of the difference between the total rent for the then remaining lease term of the original lease agreement and the market rent at the time determined under paragraph (a) and at the place where the goods were located on that date computed for the same lease term, and (c) any incidental damages allowed under § 57A-2A-530 , less expenses saved in consequence of the lessee's default.

(2) If the measure of damages provided in subsection (1) of this section is inadequate to put a lessor in as good a position as performance would have, the measure of damages is the present value of the profit, including reasonable overhead, the lessor would have made from full performance by the lessee, together with any incidental damages allowed under § 57A-2A-530 , due allowance for costs reasonably incurred and due credit for payments or proceeds of disposition.

Source: SL 1989, ch 419, § 1; SL 1990, ch 390, § 24; SL 2008, ch 259, § 34.
S.D. Codified Laws § 57A-9-706 — SD Code / Title 57A / Chapter 9 / Section 57A-9-706
Conditions to continuing effectiveness of financing statement filed before July 1, 2001
Status: in_force

(a) The filing of an initial financing statement in the office specified in § 57A-9-501 continues the effectiveness of a financing statement filed before July 1, 2001 if:

(1) The filing of an initial financing statement in that office would be effective to perfect a security interest under this chapter;

(2) The pre - effective - date financing statement was filed in an office in another state or another office in this state; and

(3) The initial financing statement satisfies subsection (c).

(b) The filing of an initial financing statement under subsection (a) continues the effectiveness of the pre - effective - date financing statement:

(1) The initial financing statement is filed before July 1, 2001, for the period provided in § 57A-9-403 with respect to a financing statement; and

(2) The initial financing statement is filed after July 1, 2001, for the period provided in § 57A-9-515 with respect to an initial financing statement.

(c) To be effective for purposes of subsection (a), an initial financing statement must:

(1) Satisfy the requirements of Part 5 for an initial financing statement;

(2) Identify the pre - effective - date financing statement by indicating the office in which the financing statement was filed and providing the dates of filing and file numbers, if any, of the financing statement and of the most recent continuation statement filed with respect to the financing statement; and

(3) Indicate that the pre - effective - date financing statement remains effective.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-2A-220 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-220
Effect of default on risk of loss
Status: in_force

(1) Where risk of loss is to pass to the lessee and the time of passage is not stated:

(a) If a tender or delivery of goods so fails to conform to the lease contract as to give a right of rejection, the risk of their loss remains with the lessor, or, in the case of a finance lease, the supplier, until cure or acceptance.

(b) If the lessee rightfully revokes acceptance, he, to the extent of any deficiency in his effective insurance coverage, may treat the risk of loss as having remained with the lessor from the beginning.

(2) Whether or not risk of loss is to pass to the lessee, if the lessee as to conforming goods already identified to a lease contract repudiates or is otherwise in default under the lease contract, the lessor, or, in the case of a finance lease, the supplier, to the extent of any deficiency in his effective insurance coverage may treat the risk of loss as resting on the lessee for a commercially reasonable time.

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-1-204 — SD Code / Title 57A / Chapter 1 / Section 57A-1-204
Value
Status: in_force

Except as otherwise provided in chapters 57A-3 , 57A-4 , 57A-5 , 57A-6 , and 57A-12 , a person gives value for rights if the person acquires them:

(1) In return for a binding commitment to extend credit or for the extension of immediately available credit, whether or not drawn upon and whether or not a charge-back is provided for in the event of difficulties in collection;

(2) As security for, or in total or partial satisfaction of, a preexisting claim;

(3) By accepting delivery under a preexisting contract for purchase; or

(4) In return for any consideration sufficient to support a simple contract.

Source: SL 2008, ch 259, § 12; SL 2024, ch 198, § 2.
S.D. Codified Laws § 57A-4-405 — SD Code / Title 57A / Chapter 4 / Section 57A-4-405
Death or incompetence of customer
Status: in_force

(a) A payor or collecting bank's authority to accept, pay, or collect an item or to account for proceeds of its collection, if otherwise effective, is not rendered ineffective by incompetence of a customer of either bank existing at the time the item is issued or its collection is undertaken if the bank does not know of an adjudication of incompetence. Neither death nor incompetence of a customer revokes the authority to accept, pay, collect, or account until the bank knows of the fact of death or of an adjudication of incompetence and has reasonable opportunity to act on it.

(b) Even with knowledge, a bank may for ten days after the date of death pay or certify checks drawn on or before that date unless ordered to stop payment by a person claiming an interest in the account.

Source: SL 1994, ch 368, § 4-405.
S.D. Codified Laws § 57A-1-310 — SD Code / Title 57A / Chapter 1 / Section 57A-1-310
Subordinated obligations
Status: in_force

An obligation may be issued as subordinated to performance of another obligation of the person obligated, or a creditor may subordinate its right to performance of an obligation by agreement with either the person obligated or another creditor of the person obligated. Subordination does not create a security interest as against either the common debtor or a subordinated creditor.

Source: SL 2008, ch 259, § 24.
S.D. Codified Laws § 57A-2-710 — SD Code / Title 57A / Chapter 2 / Section 57A-2-710
Seller's incidental damages
Status: in_force

Incidental damages to an aggrieved seller include any commercially reasonable charges, expenses or commissions incurred in stopping delivery, in the transportation, care and custody of goods after the buyer's breach, in connection with return or resale of the goods or otherwise resulting from the breach.

Source: SL 1966, ch 150, § 2-710; SDCL, § 57-8-27.
S.D. Codified Laws § 57A-3A-104 — SD Code / Title 57A / Chapter 3A / Section 57A-3A-104
Assignee of consumer paper not holder in due course though instrument unmarked--Contrary agreement void
Status: in_force

Notwithstanding the absence of such notice on an instrument arising out of a consumer credit sale or consumer lease as described in this chapter, an assignee of the rights of the seller or lessor shall not be deemed a holder in due course. Any agreement to the contrary shall be of no force or effect in limiting the rights of a retail buyer under this chapter.

Source: SL 1973, ch 295, § 3; SDCL Supp, § 57-10A-4.
S.D. Codified Laws § 57A-5-114 — SD Code / Title 57A / Chapter 5 / Section 57A-5-114
Assignment of proceeds
Status: in_force

(a) In this section, "proceeds of a letter of credit" means the cash, check, accepted draft, or other item of value paid or delivered upon honor or giving of value by the issuer or any nominated person under the letter of credit. The term does not include a beneficiary's drawing rights or documents presented by the beneficiary.

(b) A beneficiary may assign its right to part or all of the proceeds of a letter of credit. The beneficiary may do so before presentation as a present assignment of its right to receive proceeds contingent upon its compliance with the terms and conditions of the letter of credit.

(c) An issuer or nominated person need not recognize an assignment of proceeds of a letter of credit until it consents to the assignment.

(d) An issuer or nominated person has no obligation to give or withhold its consent to an assignment of proceeds of a letter of credit, but consent may not be unreasonably withheld if the assignee possesses and exhibits the letter of credit and presentation of the letter of credit is a condition to honor.

(e) Rights of a transferee beneficiary or nominated person are independent of the beneficiary's assignment of the proceeds of a letter of credit and are superior to the assignee's right to the proceeds.

(f) Neither the rights recognized by this section between an assignee and an issuer, transferee beneficiary, or nominated person nor the issuer's or nominated person's payment of proceeds to an assignee or a third person affect the rights between the assignee and any person other than the issuer, transferee beneficiary, or nominated person. The mode of creating and perfecting a security interest in or granting an assignment of a beneficiary's rights to proceeds is governed by chapter 57A-9 or other law. Against persons other than the issuer, transferee beneficiary, or nominated person, the rights and obligations arising upon the creation of a security interest or other assignment of a beneficiary's right to proceeds and its perfection are governed by chapter 57A-9 or other law.

Source: SL 1998, ch 283, § 1.
S.D. Codified Laws § 57A-3-308 — SD Code / Title 57A / Chapter 3 / Section 57A-3-308
Proof of signatures and status as holder in due course
Status: in_force

(a) In an action with respect to an instrument, the authenticity of, and authority to make, each signature on the instrument is admitted unless specifically denied in the pleadings. If the validity of a signature is denied in the pleadings, the burden of establishing validity is on the person claiming validity, but the signature is presumed to be authentic and authorized unless the action is to enforce the liability of the purported signer and the signer is dead or incompetent at the time of trial of the issue of validity of the signature. If an action to enforce the instrument is brought against a person as the undisclosed principal of a person who signed the instrument as a party to the instrument, the plaintiff has the burden of establishing that the defendant is liable on the instrument as a represented person under § 57A-3-402(a).

(b) If the validity of signatures is admitted or proved and there is compliance with subsection (a), a plaintiff producing the instrument is entitled to payment if the plaintiff proves entitlement to enforce the instrument under § 57A-3-301 , unless the defendant proves a defense or claim in recoupment. If a defense or claim in recoupment is proved, the right to payment of the plaintiff is subject to the defense or claim, except to the extent the plaintiff proves that the plaintiff has rights of a holder in due course which are not subject to the defense or claim.

Source: SL 1994, ch 367, § 3-308.
S.D. Codified Laws § 57A-2A-407 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-407
Irrevocable promises: finance leases
Status: in_force

(1) In the case of a finance lease that is not a consumer lease the lessee's promises under the lease contract become irrevocable and independent upon the lessee's acceptance of the goods.

(2) A promise that has become irrevocable and independent under subsection (1) of this section:

(a) Is effective and enforceable between the parties, and by or against third parties including assignees of the parties, and

(b) Is not subject to cancellation, termination, modification, repudiation, excuse, or substitution without the consent of the party to whom the promise runs.

(3) This section shall not affect the validity under any other law of a covenant in any lease contract making the lessee's promises irrevocable and independent upon the lessee's acceptance of the goods.

Source: SL 1989, ch 419, § 1; SL 1990, ch 390, § 15.
S.D. Codified Laws § 57A-12-101 — SD Code / Title 57A / Chapter 12 / Section 57A-12-101
Short title
Status: in_force

This article may be cited as Uniform Commercial Code--Controllable Electronic Records.

Source: SL 2024, ch 198, § 93.
S.D. Codified Laws § 57A-2-203 — SD Code / Title 57A / Chapter 2 / Section 57A-2-203
Seals inoperative
Status: in_force

The affixing of a seal to a record evidencing a contract for sale or an offer to buy or sell goods does not constitute the record of a sealed instrument and the law with respect to sealed instruments does not apply to such a contract or offer.

Source: SL 1966, ch 150, § 2-203; SDCL, § 57-3-5; SL 2024, ch 198, § 10.
S.D. Codified Laws § 57A-2-314 — SD Code / Title 57A / Chapter 2 / Section 57A-2-314
Implied warranty--Merchantability--Usage of trade
Status: in_force

(1) Unless excluded or modified (§ 57A-2-316 ), a warranty that the goods shall be merchantable is implied in a contract for their sale if the seller is a merchant with respect to goods of that kind. Under this section the serving for value of food or drink to be consumed either on the premises or elsewhere is a sale.

(2) Goods to be merchantable must be at least such as

(a) Pass without objection in the trade under the contract description; and

(b) In the case of fungible goods, are of fair average quality within the description; and

(c) Are fit for the ordinary purposes for which such goods are used; and

(d) Run, within the variations permitted by the agreement, of even kind, quality and quantity within each unit and among all units involved; and

(e) Are adequately contained, packaged, and labeled as the agreement may require; and

(f) Conform to the promises or affirmations of fact made on the container or label if any.

(3) Unless excluded or modified (§ 57A-2-316 ) other implied warranties may arise from course of dealing or usage of trade.

Source: SL 1966, ch 150, § 2-314; SDCL, §§ 57-4-30 to 57-4-32.
S.D. Codified Laws § 57A-9-342 — SD Code / Title 57A / Chapter 9 / Section 57A-9-342
Bank's right with respect to agreement giving secured party control of deposit account
Status: in_force

This chapter does not require a bank to enter into an agreement of the kind described in § 57A-9-104(a)(2), even if its customer so requests or directs. A bank that has entered into such an agreement is not required to confirm the existence of the agreement to another person unless requested to do so by its customer.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-4-212 — SD Code / Title 57A / Chapter 4 / Section 57A-4-212
Presentment by notice of item not payable by, through, or at a bank--Liability of drawer or indorser
Status: in_force

(a) Unless otherwise instructed, a collecting bank may present an item not payable by, through, or at a bank by sending to the party to accept or pay a written notice that the bank holds the item for acceptance or payment. The notice must be sent in time to be received on or before the day when presentment is due and the bank must meet any requirement of the party to accept or pay under § 57A-3-501 by the close of the bank's next banking day after it knows of the requirement.

(b) If presentment is made by notice and payment, acceptance, or request for compliance with a requirement under § 57A-3-501 is not received by the close of business on the day after maturity or, in the case of demand items, by the close of business on the third banking day after notice was sent, the presenting bank may treat the item as dishonored and charge any drawer or indorser by sending it notice of the facts.

Source: SL 1994, ch 368, § 4-212.
S.D. Codified Laws § 57A-9-804 — SD Code / Title 57A / Chapter 9 / Section 57A-9-804
Security interest unperfected before effective date
Status: in_force

A security interest that is an unperfected security interest immediately before July 1, 2013 becomes a perfected security interest:

(1) Without further action, on July 1, 2013 if the applicable requirements for perfection under chapter- 57A-9 as amended by SL 2012, ch 238 are satisfied before or at that time; or

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

Source: SL 2012, ch 238, § 9-804, eff. July 1, 2013.
S.D. Codified Laws § 57A-2-202 — SD Code / Title 57A / Chapter 2 / Section 57A-2-202
Final expression--Parol or extrinsic evidence
Status: in_force

Terms with respect to which the confirmatory memoranda of the parties agree or which are otherwise set forth in a record intended by the parties as a final expression of their agreement with respect to such terms as are included therein may not be contradicted by evidence of any prior agreement or of a contemporaneous oral agreement but may be explained or supplemented:

(a) By course of performance, course of dealing or usage of trade (§ 57A-1-303 ); and

(b) By evidence of consistent additional terms unless the court finds the record to have been intended also as a complete and exclusive statement of the terms of the agreement.

Source: SL 1966, ch 150, § 2-202; SDCL § 57-3-4; SL 2008, ch 259, § 26; SL 2024, ch 198, § 9.
S.D. Codified Laws § 57A-1-102 — SD Code / Title 57A / Chapter 1 / Section 57A-1-102
Scope of chapter
Status: in_force

This chapter applies to a transaction to the extent that it is governed by another chapter of Title 57A.

Source: SL 2008, ch 259, § 2.
S.D. Codified Laws § 57A-9-620 — SD Code / Title 57A / Chapter 9 / Section 57A-9-620
Acceptance of collateral in full or partial satisfaction of obligation--Compulsory disposition of collateral
Status: in_force

(a) Except as otherwise provided in subsection (g), a secured party may accept collateral in full or partial satisfaction of the obligation it secures only if:

(1) The debtor consents to the acceptance under subsection (c);

(2) The secured party does not receive, within the time set forth in subsection (d), a notification of objection to the proposal signed by:

(A) A person to which the secured party was required to send a proposal under § 57A-9-621 ; or

(B) Any other person, other than the debtor, holding an interest in the collateral subordinate to the security interest that is the subject of the proposal;

(3) If the collateral is consumer goods, the collateral is not in the possession of the debtor when the debtor consents to the acceptance; and

(4) Subsection (e) does not require the secured party to dispose of the collateral or the debtor waives the requirement pursuant to § 57A-9-624 .

(b) A purported or apparent acceptance of collateral under this section is ineffective unless:

(1) The secured party consents to the acceptance in a signed record or sends a proposal to the debtor; and

(2) The conditions of subsection (a) are met.

(c) For purposes of this section:

(1) A debtor consents to an acceptance of collateral in partial satisfaction of the obligation it secures only if the debtor agrees to the terms of the acceptance in a record signed after default; and

(2) A debtor consents to an acceptance of collateral in full satisfaction of the obligation it secures only if the debtor agrees to the terms of the acceptance in a record signed after default or the secured party:

(A) Sends to the debtor after default a proposal that is unconditional or subject only to a condition that collateral not in the possession of the secured party be preserved or maintained;

(B) In the proposal, proposes to accept collateral in full satisfaction of the obligation it secures; and

(C) Does not receive a notification of objection signed by the debtor within twenty days after the proposal is sent.

(d) To be effective under subsection (a)(2), a notification of objection must be received by the secured party:

(1) In the case of a person to which the proposal was sent pursuant to § 57A-9-621 , within twenty days after notification was sent to that person; and

(2) In other cases:

(A) Within twenty days after the last notification was sent pursuant to § 57A-9-621 ; or

(B) If a notification was not sent, before the debtor consents to the acceptance under subsection (c).

(e) A secured party that has taken possession of collateral shall dispose of the collateral pursuant to § 57A-9-610 within the time specified in subsection (f) if:

(1) Sixty percent of the cash price has been paid in the case of a purchase - money security interest in consumer goods; or

(2) Sixty percent of the principal amount of the obligation secured has been paid in the case of a non - purchase - money security interest in consumer goods .

(f) To comply with subsection (e), the secured party shall dispose of the collateral:

(1) Within ninety days after taking possession; or

(2) Within any longer period to which the debtor and all secondary obligors have agreed in an agreement to that effect entered into and signed after default.

(g) In a consumer transaction, a secured party may not accept collateral in partial satisfaction of the obligation it secures.

Source: SL 2000, ch 231; SL 2024, ch 198, § 89.
S.D. Codified Laws § 57A-3A-102 — SD Code / Title 57A / Chapter 3A / Section 57A-3A-102
Instruments to be marked consumer paper--Holder not holder in due course
Status: in_force

If any contract for sale or lease of consumer goods or services on credit, entered into between a retail seller and a retail buyer, requires or involves the execution of a promissory note, instrument or other evidence of indebtedness, hereinafter called instrument, such instrument shall have printed conspicuously on the face thereof the words "consumer paper," and a holder of such instrument shall not be deemed a holder in due course.

Source: SL 1973, ch 295, § 2; SDCL Supp, § 57-10A-2.
S.D. Codified Laws § 57A-11-101 — SD Code / Title 57A / Chapter 11 / Section 57A-11-101
Effective date
Status: in_force

This 1983 Act shall become effective at 12:01 a.m. on July 1, 1983.

Source: SDCL, § 57A-11-101 , enacted by SL 1982, ch 347, § 38; SL 1983, ch 367, § 7.
S.D. Codified Laws § 57A-9-508 — SD Code / Title 57A / Chapter 9 / Section 57A-9-508
Effect of new debtor's rights in collateral
Status: in_force

(a) Except as otherwise provided in this section, a filed financing statement naming an original debtor is effective to perfect a security interest in collateral in which a new debtor has or acquires rights to the extent that the financing statement would have been effective had the original debtor acquired rights in the collateral.

(b) If the difference between the name of the original debtor and that of the new debtor causes a filed financing statement that is effective under subsection (a) to be seriously misleading under § 57A-9-506 :

(1) The financing statement is effective to perfect a security interest in collateral acquired by the new debtor before, and within four months after, the new debtor becomes bound under § 57A-9-203(d); and

(2) The financing statement is not effective to perfect a security interest in collateral acquired by the new debtor more than four months after the new debtor becomes bound under § 57A-9-203(d) unless an initial financing statement providing the name of the new debtor is filed before the expiration of that time.

(c) This section does not apply to collateral as to which a filed financing statement remains effective against the new debtor under § 57A-9-507(a).

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-3-112 — SD Code / Title 57A / Chapter 3 / Section 57A-3-112
Interest
Status: in_force

(a) Unless otherwise provided in the instrument, (i) an instrument is not payable with interest, and (ii) interest on an interest - bearing instrument is payable from the date of the instrument.

(b) Interest may be stated in an instrument as a fixed or variable amount of money or it may be expressed as a fixed or variable rate or rates. The amount or rate of interest may be stated or described in the instrument in any manner and may require reference to information not contained in the instrument. If an instrument provides for interest, but the amount of interest payable cannot be ascertained from the description, interest is payable at the judgment rate in effect at the place of payment of the instrument and at the time interest first accrues.

Source: SL 1994, ch 367, § 3-112.
S.D. Codified Laws § 57A-2-709 — SD Code / Title 57A / Chapter 2 / Section 57A-2-709
Action for the price
Status: in_force

(1) When the buyer fails to pay the price as it becomes due the seller may recover, together with any incidental damages under § 57A-2-710 , the price

(a) Of goods accepted or of conforming goods lost or damaged within a commercially reasonable time after risk of their loss has passed to the buyer; and

(b) Of goods identified to the contract if the seller is unable after reasonable effort to resell them at a reasonable price or the circumstances reasonably indicate that such effort will be unavailing.

(2) Where the seller sues for the price he must hold for the buyer any goods which have been identified to the contract and are still in his control except that if resale becomes possible he may resell them at any time prior to the collection of the judgment. The net proceeds of any such resale must be credited to the buyer and payment of the judgment entitles him to any goods not resold.

(3) After the buyer has wrongfully rejected or revoked acceptance of the goods or has failed to make a payment due or has repudiated (§ 57A-2-610 ), a seller who is held not entitled to the price under this section shall nevertheless be awarded damages for nonacceptance under § 57A-2-708 .

Source: SL 1966, ch 150, § 2-709; SDCL, §§ 57-8-24 to 57-8-26.
S.D. Codified Laws § 57A-2A-204 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-204
Formation in general
Status: in_force

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

(2) An agreement sufficient to constitute a lease contract may be found although the moment of its making is undetermined.

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

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-9-107.1 — SD Code / Title 57A / Chapter 9 / Section 57A-9-107.1
Control of controllable electronic record, controllable account, or controllable payment intangible
Status: in_force

(a) A secured party has control of a controllable electronic record as provided in § 57A-12-105 .

(b) A secured party has control of a controllable account or controllable payment intangible if the secured party has control of the controllable electronic record that evidences the controllable account or controllable payment intangible.

Source: SL 2024, ch 198, § 47.
S.D. Codified Laws § 57A-2-313 — SD Code / Title 57A / Chapter 2 / Section 57A-2-313
Express warranties by affirmation, promise, description, sample
Status: in_force

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

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

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

(2) It is not necessary to the creation of an express warranty that the seller use formal words such as "warrant" or "guarantee" or that he 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 seller's opinion or commendation of the goods does not create a warranty.

Source: SL 1966, ch 150, § 2-313; SDCL, §§ 57-4-25 to 57-4-29.
S.D. Codified Laws § 57A-7-307 — SD Code / Title 57A / Chapter 7 / Section 57A-7-307
Lien of carrier
Status: in_force

(a) A carrier has a lien on the goods covered by a bill of lading or on the proceeds thereof in its possession for charges after the date of the carrier's receipt of the goods for storage or transportation, including demurrage and terminal charges, and for expenses necessary for preservation of the goods incident to their transportation or reasonably incurred in their sale pursuant to law. However, against a purchaser for value of a negotiable bill of lading, a carrier's lien is limited to charges stated in the bill or the applicable tariffs or, if no charges are stated, a reasonable charge.

(b) A lien for charges and expenses under subsection (a) on goods that the carrier was required by law to receive for transportation is effective against the consignor or any person entitled to the goods unless the carrier had notice that the consignor lacked authority to subject the goods to those charges and expenses. Any other lien under subsection (a) is effective against the consignor and any person that permitted the bailor to have control or possession of the goods unless the carrier had notice that the bailor lacked authority.

(c) A carrier loses its lien on any goods that it voluntarily delivers or unjustifiably refuses to deliver.

Source: SL 2009, ch 254, § 7-307.
S.D. Codified Laws § 57A-5-111 — SD Code / Title 57A / Chapter 5 / Section 57A-5-111
Remedies
Status: in_force

(a) If an issuer wrongfully dishonors or repudiates its obligation to pay money under a letter of credit before presentation, the beneficiary, successor, or nominated person presenting on its own behalf may recover from the issuer the amount that is the subject of the dishonor or repudiation. If the issuer's obligation under the letter of credit is not for the payment of money, the claimant may obtain specific performance or, at the claimant's election, recover an amount equal to the value of performance from the issuer. In either case, the claimant may also recover incidental but not consequential damages. The claimant is not obligated to take action to avoid damages that might be due from the issuer under this subsection. If, although not obligated to do so, the claimant avoids damages, the claimant's recovery from the issuer must be reduced by the amount of damages avoided. The issuer has the burden of proving the amount of damages avoided. In the case of repudiation the claimant need not present any document.

(b) If an issuer wrongfully dishonors a draft or demand presented under a letter of credit or honors a draft or demand in breach of its obligation to the applicant, the applicant may recover damages resulting from the breach, including incidental but not consequential damages, less any amount saved as a result of the breach.

(c) If an adviser or nominated person other than a confirmer breaches an obligation under this chapter or an issuer breaches an obligation not covered in subsection (a) or (b), a person to whom the obligation is owed may recover damages resulting from the breach, including incidental but not consequential damages, less any amount saved as a result of the breach. To the extent of the confirmation, a confirmer has the liability of an issuer specified in this subsection and subsections (a) and (b).

(d) An issuer, nominated person, or adviser who is found liable under subsection (a), (b), or (c) shall pay interest on the amount owed thereunder from the date of wrongful dishonor or other appropriate date.

(e) Reasonable attorney's fees and other expenses of litigation must be awarded to the prevailing party in an action in which a remedy is sought under this chapter.

(f) Damages that would otherwise be payable by a party for breach of an obligation under this chapter may be liquidated by agreement or undertaking, but only in an amount or by a formula that is reasonable in light of the harm anticipated.

Source: SL 1998, ch 283, § 1.
S.D. Codified Laws § 57A-8-110 — SD Code / Title 57A / Chapter 8 / Section 57A-8-110
Applicability--Choice of law
Status: in_force

(a) The local law of the issuer's jurisdiction, as specified in subsection (d), governs:

(1) The validity of a security;

(2) The rights and duties of the issuer with respect to registration of transfer;

(3) The effectiveness of registration of transfer by the issuer;

(4) Whether the issuer owes any duties to an adverse claimant to a security; and

(5) Whether an adverse claim can be asserted against a person to whom transfer of a certificated or uncertificated security is registered or a person who obtains control of an uncertificated security.

(b) The local law of the securities intermediary's jurisdiction, as specified in subsection (e), governs:

(1) Acquisition of a security entitlement from the securities intermediary;

(2) The rights and duties of the securities intermediary and entitlement holder arising out of a security entitlement;

(3) Whether the securities intermediary owes any duties to an adverse claimant to a security entitlement; and

(4) Whether an adverse claim can be asserted against a person who acquires a security entitlement from the securities intermediary or a person who purchases a security entitlement or interest therein from an entitlement holder.

(c) The local law of the jurisdiction in which a security certificate is located at the time of delivery governs whether an adverse claim can be asserted against a person to whom the security certificate is delivered.

(d) "Issuer's jurisdiction" means the jurisdiction under which the issuer of the security is organized or, if permitted by the law of that jurisdiction, the law of another jurisdiction specified by the issuer. An issuer organized under the law of this State may specify the law of another jurisdiction as the law governing the matters specified in subsection (a)(2) through (5).

(e) The following rules determine a "securities intermediary's jurisdiction" for purposes of this section:

(1) If an agreement between the securities intermediary and its entitlement holder governing the securities account expressly provides that a particular jurisdiction is the securities intermediary's jurisdiction for purposes of this part, this article, or this chapter, that jurisdiction is the securities intermediary's jurisdiction.

(2) If paragraph (1) does not apply and an agreement between the securities intermediary and its entitlement holder governing the securities account expressly provides that the agreement is governed by the law of a particular jurisdiction, that jurisdiction is the securities intermediary's jurisdiction.

(3) If neither paragraph (1) nor paragraph (2) applies and an agreement between the securities intermediary and its entitlement holder governing the securities account expressly provides that the securities account is maintained at an office in a particular jurisdiction, that jurisdiction is the securities intermediary's jurisdiction.

(4) If none of the preceding paragraphs applies, the securities intermediary's jurisdiction is the jurisdiction in which the office identified in an account statement as the office serving the entitlement holder's account is located.

(5) If none of the preceding paragraphs applies, the securities intermediary's jurisdiction is the jurisdiction in which the chief executive office of the securities intermediary is located.

(f) A securities intermediary's jurisdiction is not determined by the physical location of certificates representing financial assets, or by the jurisdiction in which is organized the issuer of the financial asset with respect to which an entitlement holder has a security entitlement, or by the location of facilities for data processing or other record keeping concerning the account.

(g) The local law of the issuer's jurisdiction or the securities intermediary's jurisdiction governs a matter or transaction specified in subsection (a) or (b) even if the matter or transaction does not bear any relation to the jurisdiction.

Source: SL 1998, ch 284, § 1; SL 2000, ch 231, § 16; SL 2024, ch 198, § 41.
S.D. Codified Laws § 57A-5-110 — SD Code / Title 57A / Chapter 5 / Section 57A-5-110
Warranties
Status: in_force

(a) If its presentation is honored, the beneficiary warrants:

(1) To the issuer, any other person to whom presentation is made, and the applicant that there is no fraud or forgery of the kind described in § 57A-5-109(a); and

(2) To the applicant that the drawing does not violate any agreement between the applicant and beneficiary or any other agreement intended by them to be augmented by the letter of credit.

(b) The warranties in subsection (a) are in addition to warranties arising under chapters 57A-3 , 57A-4 , 57A-7 , and 57A-8 because of the presentation or transfer of documents covered by any of those chapters.

Source: SL 1998, ch 283, § 1.
S.D. Codified Laws § 57A-2-705 — SD Code / Title 57A / Chapter 2 / Section 57A-2-705
Seller's stoppage of delivery in transit or otherwise
Status: in_force

(1) The seller may stop delivery of goods in the possession of a carrier or other bailee when he discovers the buyer to be insolvent (§ 57A-2-702 ) and may stop delivery of carload, truckload, planeload or larger shipments of express or freight when the buyer repudiates or fails to make a payment due before delivery or if for any other reason the seller has a right to withhold or reclaim the goods.

(2) As against such buyer the seller may stop delivery until

(a) Receipt of the goods by the buyer; or

(b) Acknowledgment to the buyer by any bailee of the goods except a carrier that the bailee holds the goods for the buyer; or

(c) Such acknowledgment to the buyer by a carrier by reshipment or as a warehouse; or

(d) Negotiation to the buyer of any negotiable document of title covering the goods.

(3)(a) To stop delivery the seller must so notify as to enable the bailee by reasonable diligence to prevent delivery of the goods.

(b) After such notification the bailee must hold and deliver the goods according to the directions of the seller but the seller is liable to the bailee for any ensuing charges or damages.

(c) If a negotiable document of title has been issued for goods the bailee is not obliged to obey a notification to stop until surrender of possession or control of the document.

(d) A carrier who has issued a nonnegotiable bill of lading is not obliged to obey a notification to stop received from a person other than the consignor.

Source: SL 1966, ch 150, § 2-705; SDCL §§ 57-8-8 to 57-8-13; SL 2009, ch 254, § 816.
S.D. Codified Laws § 57A-7-401 — SD Code / Title 57A / Chapter 7 / Section 57A-7-401
Irregularities in issue of receipt or bill or conduct of issuer
Status: in_force

The obligations imposed by this chapter on an issuer apply to a document of title even if:

(1) The document does not comply with the requirements of this chapter or of any other statute, rule, or regulation regarding its issue, form, or content;

(2) The issuer violated laws regulating the conduct of its business;

(3) The goods covered by the document were owned by the bailee when the document was issued; or

(4) The person issuing the document is not a warehouse but the document purports to be a warehouse receipt.

Source: SL 2009, ch 254, § 7-401.
S.D. Codified Laws § 57A-2-607 — SD Code / Title 57A / Chapter 2 / Section 57A-2-607
Effect of acceptance--Notice of breach--Burden of establishing breach after acceptance--Notice of claim or litigation to person answerable over
Status: in_force

(1) The buyer must pay at the contract rate for any goods accepted.

(2) Acceptance of goods by the buyer precludes rejection of the goods accepted and if made with knowledge of a nonconformity cannot be revoked because of it unless the acceptance was on the reasonable assumption that the nonconformity would be seasonably cured but acceptance does not of itself impair any other remedy provided by this chapter for nonconformity.

(3) Where a tender has been accepted

(a) The buyer must within a reasonable time after he discovers or should have discovered any breach notify the seller of breach or be barred from any remedy; and

(b) If the claim is one for infringement or the like (subsection (3) of § 57A-2-312 ) and the buyer is sued as a result of such a breach he must so notify the seller within a reasonable time after he receives notice of the litigation or be barred from any remedy over for liability established by the litigation.

(4) The burden is on the buyer to establish any breach with respect to the goods accepted.

(5) Where the buyer is sued for breach of a warranty or other obligation for which his seller is answerable over

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

(b) If the claim is one for infringement or the like (subsection (3) of § 57A-2-312 ) the original seller may demand in writing that his buyer turn over to him control of the litigation including settlement or else be barred from any remedy over and if he also agrees to bear all expense and to satisfy any adverse judgment, then unless the buyer after seasonable receipt of the demand does turn over control the buyer is so barred.

(6) The provisions of subsections (3), (4) and (5) apply to any obligation of a buyer to hold the seller harmless against infringement or the like (subsection (3) of § 57A-2-312 ).

Source: SL 1966, ch 150, § 2-607; SDCL, §§ 57-7-13 to 57-7-19.
S.D. Codified Laws § 57A-2A-507 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-507
Proof of market rent: time and place
Status: in_force

(1) Damages based on market rent (§ 57A-2A-519 or 57A-2A-528 ) are determined according to the rent for the use of the goods concerned for a lease term identical to the remaining lease term of the original lease agreement and prevailing at the time of the default.

(2) If evidence of rent for the use of the goods concerned for a lease term identical to the remaining lease term of the original lease agreement and prevailing at the times or places described in this chapter is not readily available, the rent prevailing within any reasonable time before or after the time described or at any other place or for a different lease term which in commercial judgment or under usage of trade would serve as a reasonable substitute for the one described may be used, making any proper allowance for the difference, including the cost of transporting the goods to or from the other place.

(3) Evidence of a relevant rent prevailing at a time or place or for a lease term other than the one described in this chapter offered by one party is not admissible unless and until he has given the other party notice the court finds sufficient to prevent unfair surprise.

(4) If the prevailing rent or value of any goods regularly leased in any established market is in issue, reports in official publications or trade journals or in newspapers or periodicals of general circulation published as the reports of that market are admissible in evidence. The circumstances of the preparation of the report may be shown to affect its weight but not its admissibility.

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-2-509 — SD Code / Title 57A / Chapter 2 / Section 57A-2-509
Risk of loss in the absence of breach
Status: in_force

(1) Where the contract requires or authorizes the seller to ship the goods by carrier

(a) If it does not require him to deliver them at a particular destination, the risk of loss passes to the buyer when the goods are duly delivered to the carrier even though the shipment is under reservation (§ 57A-2-505 ); but

(b) If it does require him to deliver them 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 buyer when the goods are there duly so tendered as to enable the buyer to take delivery.

(2) Where the goods are held by a bailee to be delivered without being moved, the risk of loss passes to the buyer

(a) On his receipt of possession or control of a negotiable document of title covering the goods; or

(b) On acknowledgment by the bailee of the buyer's right to possession of the goods; or

(c) After his receipt of possession or control of a nonnegotiable document of title or other direction to deliver in a record, as provided in subsection (4)(b) of § 57A-2-503 .

(3) In any case not within subsection (1) or (2), the risk of loss passes to the buyer on his receipt of the goods if the seller is a merchant; otherwise the risk passes to the buyer on tender of delivery.

(4) The provisions of this section are subject to contrary agreement of the parties and to the provisions of this chapter on sale on approval (§ 57A-2-327 ) and on effect of breach on risk of loss (§ 57A-2-510 ).

Source: SL 1966, ch 150, § 2-509; SDCL §§ 57-6-21 to 57-6-24; SL 2009, ch 254, § 814.
S.D. Codified Laws § 57A-2A-531 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-531
Standing to sue third parties for injury to goods
Status: in_force

(1) If a third party so deals with goods that have been identified to a lease contract as to cause actionable injury to a party to the lease contract (a) the lessor has a right of action against the third party, and (b) the lessee also has a right of action against the third party if the lessee:

(i) Has a security interest in the goods;

(ii) Has an insurable interest in the goods; or

(iii) Bears the risk of loss under the lease contract or has since the injury assumed that risk as against the lessor and the goods have been converted or destroyed.

(2) If at the time of the injury the party plaintiff did not bear the risk of loss as against the other party to the lease contract and there is no arrangement between them for disposition of the recovery, his suit or settlement, subject to his own interest, is as a fiduciary for the other party to the lease contract.

(3) Either party with the consent of the other may sue for the benefit of whom it may concern.

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-4A-207 — SD Code / Title 57A / Chapter 4A / Section 57A-4A-207
Misdescription of beneficiary
Status: in_force

(a) Subject to subsection (b), if, in a payment order received by the beneficiary's bank, the name, bank account number or other identification of the beneficiary refers to a nonexistent or unidentifiable person or account, no person has rights as a beneficiary of the order and acceptance of the order cannot occur.

(b) If a payment order received by the beneficiary's bank identifies the beneficiary both by name and by an identifying or bank account number and the name and number identify different persons, the following rules apply:

(1) Except as otherwise provided in subsection (c), if the beneficiary's bank does not know that the name and number refer to different persons, it may rely on the number as the proper identification of the beneficiary of the order. The beneficiary's bank need not determine whether the name and number refer to the same person.

(2) If the beneficiary's bank pays the person identified by name or knows that the name and number identify different persons, no person has rights as beneficiary except the person paid by the beneficiary's bank if that person was entitled to receive payment from the originator of the funds transfer. If no person has rights as beneficiary, acceptance of the order cannot occur.

(c) If (i) a payment order described in subsection (b) is accepted, (ii) the originator's payment order described the beneficiary inconsistently by name and number, and (iii) the beneficiary's bank pays the person identified by number as permitted by subsection (b)(1), the following rules apply:

(1) If the originator is a bank, the originator is obliged to pay its order.

(2) If the originator is not a bank and proves that the person identified by number was not entitled to receive payment from the originator, the originator is not obliged to pay its order unless the originator's bank proves that the originator, before acceptance of the originator's order, had notice that payment of a payment order issued by the originator might be made by the beneficiary's bank on the basis of an identifying or bank account number even if it identifies a person different from the named beneficiary. Proof of notice may be made by any admissible evidence. The originator's bank satisfies the burden of proof if it proves that the originator, before the payment order was accepted, signed a record stating the information to which the notice relates.

(d) In a case governed by subsection (b)(1), if the beneficiary's bank rightfully pays the person identified by number and that person was not entitled to receive payment from the originator, the amount paid may be recovered from that person to the extent allowed by the law governing mistake and restitution as follows:

(1) If the originator is obliged to pay its payment order as stated in subsection (c), the originator has the right to recover.

(2) If the originator is not a bank and is not obliged to pay its payment order, the originator's bank has the right to recover.

Source: SL 1991, ch 397, § 1; SL 2024, ch 198, § 29.
S.D. Codified Laws § 57A-3-201 — SD Code / Title 57A / Chapter 3 / Section 57A-3-201
Negotiation
Status: in_force

(a) "Negotiation" means a transfer of possession, whether voluntary or involuntary, of an instrument by a person other than the issuer to a person who thereby becomes its holder.

(b) Except for negotiation by a remitter, if an instrument is payable to an identified person, negotiation requires transfer of possession of the instrument and its indorsement by the holder. If an instrument is payable to bearer, it may be negotiated by transfer of possession alone.

Source: SL 1994, ch 367, § 3-201.
S.D. Codified Laws § 57A-4-301 — SD Code / Title 57A / Chapter 4 / Section 57A-4-301
Deferred posting--Recovery of payment by return of items--Time of dishonor--Return of items by payor bank
Status: in_force

(a) If a payor bank settles for a demand item other than a documentary draft presented otherwise than for immediate payment over the counter before midnight of the banking day of receipt, the payor bank may revoke the settlement and recover the settlement if, before it has made final payment and before its midnight deadline, it:

(1) Returns the item; or

(2) Sends written notice of dishonor or nonpayment if the item is unavailable for return.

(b) If a demand item is received by a payor bank for credit on its books, it may return the item or send notice of dishonor and may revoke any credit given or recover the amount thereof withdrawn by its customer, if it acts within the time limit and in the manner specified in subsection (a).

(c) Unless previous notice of dishonor has been sent, an item is dishonored at the time when for purposes of dishonor it is returned or notice sent in accordance with this section.

(d) An item is returned:

(1) As to an item presented through a clearing house, when it is delivered to the presenting or last collecting bank or to the clearing house or is sent or delivered in accordance with clearing - house rules; or

(2) In all other cases, when it is sent or delivered to the bank's customer or transferor or pursuant to instructions.

Source: SL 1994, ch 368, § 4-301.
S.D. Codified Laws § 57A-8-502 — SD Code / Title 57A / Chapter 8 / Section 57A-8-502
Assertion of adverse claim against entitlement holder
Status: in_force

An action based on an adverse claim to a financial asset, whether framed in conversion, replevin, constructive trust, equitable lien, or other theory, may not be asserted against a person who acquires a security entitlement under § 57A-8-501 for value and without notice of the adverse claim.

Source: SL 1998, ch 284, § 1.
S.D. Codified Laws § 57A-2A-406 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-406
Procedure on excused performance
Status: in_force

(1) If the lessee receives notification of a material or indefinite delay or an allocation justified under § 57A-2A-405 , the lessee may by written notification to the lessor as to any goods involved, and with respect to all of the goods if under an installment lease contract the value of the whole lease contract is substantially impaired as in § 57A-2A-510 :

(a) Terminate the lease contract pursuant to § 57A-2A-505(2); or

(b) Except in a finance lease, modify the lease contract by accepting the available quota in substitution, with due allowance from the rent payable for the balance of the lease term for the deficiency but without further right against the lessor.

(2) If, after receipt of a notification from the lessor under § 57A-2A-405 , the lessee fails so to modify the lease agreement within a reasonable time not exceeding thirty days, the lease contract lapses with respect to any deliveries affected.

Source: SL 1989, ch 419, § 1; SL 1990, ch 390, § 14.
S.D. Codified Laws § 57A-9-312 — SD Code / Title 57A / Chapter 9 / Section 57A-9-312
Perfection of security interests in chattel paper, controllable accounts, controllable electronic records, controllable payment intangibles, deposit accounts, negotiable documents, goods covered by documents, instruments, investment property, letter-of-credit rights, and money--Perfection by permissive filing--Temporary perfection without filing or transfer of possession
Status: in_force

(a) A security interest in chattel paper, controllable accounts, controllable electronic records, controllable payment intangibles, instruments, investment property, or negotiable documents may be perfected by filing.

(b) Except as otherwise provided in § 57A-9-315 (c) and (d) for proceeds:

(1) A security interest in a deposit account may be perfected only by control under § 57A-9-314 ;

(2) And except as otherwise provided in § 57A-9-308 (d), a security interest in a letter-of-credit right may be perfected only by control under § 57A-9-314 ;

(3) A security interest in tangible money may be perfected only by the secured party's taking possession under § 57A-9-313 ; and

(4) A security interest in electronic money may be perfected only by control under § 57A-9-314 .

(c) While goods are in the possession of a bailee that has issued a negotiable document covering the goods:

(1) A security interest in the goods may be perfected by perfecting a security interest in the document; and

(2) A security interest perfected in the document has priority over any security interest that becomes perfected in the goods by another method during that time.

(d) While goods are in the possession of a bailee that has issued a nonnegotiable document covering the goods, a security interest in the goods may be perfected by:

(1) Issuance of a document in the name of the secured party;

(2) The bailee's receipt of notification of the secured party's interest; or

(3) Filing as to the goods.

(e) A security interest in certificated securities, negotiable documents, or instruments is perfected without filing or the taking of possession or control for a period of twenty days from the time it attaches to the extent that it arises for new value given under a signed security agreement.

(f) A perfected security interest in a negotiable document or goods in possession of a bailee, other than one that has issued a negotiable document for the goods, remains perfected for twenty days without filing if the secured party makes available to the debtor the goods or documents representing the goods for the purpose of:

(1) Ultimate sale or exchange; or

(2) Loading, unloading, storing, shipping, transshipping, manufacturing, processing, or otherwise dealing with them in a manner preliminary to their sale or exchange.

(g) A perfected security interest in a certificated security or instrument remains perfected for twenty days without filing if the secured party delivers the security certificate or instrument to the debtor for the purpose of:

(1) Ultimate sale or exchange; or

(2) Presentation, collection, enforcement, renewal, or registration of transfer.

(h) After the twenty-day period specified in subsection (e), (f), or (g) expires, perfection depends upon compliance with this chapter.

Source: SL 2000, ch 231; SL 2009, ch 254, § 831; SL 2024, ch 198, § 61.
S.D. Codified Laws § 57A-3-602 — SD Code / Title 57A / Chapter 3 / Section 57A-3-602
Payment
Status: in_force

(a) Subject to subsection (b), an instrument is paid to the extent payment is made (i) by or on behalf of a party obliged to pay the instrument, and (ii) to a person entitled to enforce the instrument. To the extent of the payment, the obligation of the party obliged to pay the instrument is discharged even though payment is made with knowledge of a claim to the instrument under § 57A-3-306 by another person.

(b) The obligation of a party to pay the instrument is not discharged under subsection (a) if:

(1) A claim to the instrument under § 57A-3-306 is enforceable against the party receiving payment and (i) payment is made with knowledge by the payor that payment is prohibited by injunction or similar process of a court of competent jurisdiction, or (ii) in the case of an instrument other than a cashier's check, teller's check, or certified check, the party making payment accepted, from the person having a claim to the instrument, indemnity against loss resulting from refusal to pay the person entitled to enforce the instrument; or

(2) The person making payment knows that the instrument is a stolen instrument and pays a person it knows is in wrongful possession of the instrument.

Source: SL 1994, ch 367, § 3-602.
S.D. Codified Laws § 57A-4A-503 — SD Code / Title 57A / Chapter 4A / Section 57A-4A-503
Injunction or restraining order with respect to funds transfer
Status: in_force

For proper cause and in compliance with applicable law, a court may restrain (i) a person from issuing a payment order to initiate a funds transfer, (ii) an originator's bank from executing the payment order of the originator, or (iii) the beneficiary's bank from releasing funds to the beneficiary or the beneficiary from withdrawing the funds. A court may not otherwise restrain a person from issuing a payment order, paying or receiving payment of a payment order, or otherwise acting with the respect to a funds transfer.

Source: SL 1991, ch 397, § 1.
S.D. Codified Laws § 57A-8-510 — SD Code / Title 57A / Chapter 8 / Section 57A-8-510
Rights of purchaser of security entitlement from entitlement holder
Status: in_force

(a) In a case not covered by the priority rules in Article 9 or the rules stated in subsection (c), an action based on an adverse claim to a financial asset or security entitlement, whether framed in conversion, replevin, constructive trust, equitable lien, or other theory, may not be asserted against a person who purchases a security entitlement, or an interest therein, from an entitlement holder if the purchaser gives value, does not have notice of the adverse claim, and obtains control.

(b) If an adverse claim could not have been asserted against an entitlement holder under § 57A-8-502 , the adverse claim cannot be asserted against a person who purchases a security entitlement, or an interest therein, from the entitlement holder.

(c) In a case not covered by the priority rules in chapter 57A-9 , a purchaser for value of a security entitlement, or an interest therein, who obtains control has priority over a purchaser of a security entitlement, or an interest therein, who does not obtain control. Except as otherwise provided in subsection (d), purchasers who have control rank according to priority in time of:

(1) The purchaser's becoming the person for whom the securities account, in which the security entitlement is carried, is maintained, if the purchaser obtained control under § 57A-8-106(d)(1);

(2) The securities intermediary's agreement to comply with the purchaser's entitlement orders with respect to security entitlements carried or to be carried in the securities account in which the security entitlement is carried, if the purchaser obtained control under § 57A-8-106(d)(2); or

(3) If the purchaser obtained control through another person under § 57A-8-106(d)(3), the time on which priority would be based under this subsection if the other person were the secured party.

(d) A securities intermediary as purchaser has priority over a conflicting purchaser who has control unless otherwise agreed by the securities intermediary.

Source: SL 1998, ch 284, § 1; SL 2000, ch 231, § 19.
S.D. Codified Laws § 57A-4A-403 — SD Code / Title 57A / Chapter 4A / Section 57A-4A-403
Payment by sender to receiving bank
Status: in_force

(a) Payment of the sender's obligation under § 57A-4A-402 to pay the receiving bank occurs as follows:

(1) If the sender is a bank, payment occurs when the receiving bank receives final settlement of the obligation through a federal reserve bank or through a funds - transfer system.

(2) If the sender is a bank and the sender (i) credited an account of the receiving bank with the sender, or (ii) caused an account of the receiving bank in another bank to be credited, payment occurs when the credit is withdrawn or, if not withdrawn, at midnight of the day on which the credit is withdrawable and the receiving bank learns of that fact.

(3) If the receiving bank debits an account of the sender with the receiving bank, payment occurs when the debit is made to the extent the debit is covered by a withdrawable credit balance in the account.

(b) If the sender and receiving bank are members of a funds - transfer system that nets obligations multilaterally among participants, the receiving bank receives final settlement when settlement is complete in accordance with the rules of the system. The obligation of the sender to pay the amount of a payment order transmitted through the funds - transfer system may be satisfied, to the extent permitted by the rules of the system, by setting off and applying against the sender's obligation the right of the sender to receive payment from the receiving bank of the amount of any other payment order transmitted to the sender by the receiving bank through the funds - transfer system. The aggregate balance of obligations owed by each sender to each receiving bank in the funds - transfer system may be satisfied, to the extent permitted by the rules of the system, by setting off and applying against that balance the aggregate balance of obligations owed to the sender by other members of the system. The aggregate balance is determined after the right of setoff stated in the second sentence of this subsection has been exercised.

(c) If two banks transmit payment orders to each other under an agreement that settlement of the obligations of each bank to the other under § 57A-4A-402 will be made at the end of the day or other period, the total amount owed with respect to all orders transmitted by one bank shall be set off against the total amount owed with respect to all orders transmitted by the other bank. To the extent of the setoff, each bank has made payment to the other.

(d) In a case not covered by subsection (a), the time when payment of the sender's obligation under § 57A-4A-402(b) or 57A-4A-402(c) occurs is governed by applicable principles of law that determine when an obligation is satisfied.

Source: SL 1991, ch 397, § 1.
S.D. Codified Laws § 57A-11-102 — SD Code / Title 57A / Chapter 11 / Section 57A-11-102
Preservation of old transition provision
Status: in_force

The provisions of Title 57A in effect on July 1, 1983 shall continue to apply to this 1982 Act and for this purpose Title 57A in effect on July 1, 1983 and this 1982 Act shall be considered one continuous statute.

Source: SDCL, § 57A-11-102 , enacted by SL 1982, ch 347, § 38; SL 1983, ch 367, § 7.
S.D. Codified Laws § 57A-9-611 — SD Code / Title 57A / Chapter 9 / Section 57A-9-611
"Notification date"--Notification of disposition of collateral
Status: in_force

(a) In this section, "notification date" means the earlier of the date on which:

(1) A secured party sends to the debtor and any secondary obligor a signed notification of disposition; or

(2) The debtor and any secondary obligor waive the right to notification.

(b) Except as otherwise provided in subsection (d), a secured party that disposes of collateral under § 57A-9-610 shall send to the persons specified in subsection (c) a reasonable signed notification of disposition.

(c) To comply with subsection (b), the secured party shall send a signed notification of disposition to:

(1) The debtor;

(2) Any secondary obligor; and

(3) If the collateral is other than consumer goods:

(A) Any other person from which the secured party has received, before the notification date, a signed notification of a claim of an interest in the collateral;

(B) Any other secured party or lienholder that, ten days before the notification date, held a security interest in or other lien on the collateral perfected by the filing of a financing statement that:

(i) Identified the collateral;

(ii) Was indexed under the debtor's name as of that date; and

(iii) Was filed in the office in which to file a financing statement against the debtor covering the collateral as of that date; and

(C) Any other secured party that, ten days before the notification date, held a security interest in the collateral perfected by compliance with a statute, regulation, or treaty described in § 57A-9-311 (a).

(d) Subsection (b) does not apply if the collateral is perishable or threatens to decline speedily in value or is of a type customarily sold on a recognized market.

(e) A secured party complies with the requirement for notification prescribed by subsection (c)(3)(B) if:

(1) Not later than twenty days or earlier than thirty days before the notification date, the secured party requests, in a commercially reasonable manner, information concerning financing statements indexed under the debtor's name in the office indicated in subsection (c)(3)(B); and

(2) Before the notification date, the secured party:

(A) Did not receive a response to the request for information; or

(B) Received a response to the request for information and sent a signed notification of disposition to each secured party or other lienholder named in that response whose financing statement covered the collateral.

Source: SL 2000, ch 231; SL 2024, ch 198, § 83.
S.D. Codified Laws § 57A-5-108 — SD Code / Title 57A / Chapter 5 / Section 57A-5-108
Issuer's rights and obligations
Status: in_force

(a) Except as otherwise provided in § 57A-5-109 , an issuer shall honor a presentation that, as determined by the standard practice referred to in subsection (e), appears on its face strictly to comply with the terms and conditions of the letter of credit. Except as otherwise provided in § 57A-5-113 and unless otherwise agreed with the applicant, an issuer shall dishonor a presentation that does not appear so to comply.

(b) An issuer has a reasonable time after presentation, but not beyond the end of the seventh business day of the issuer after the day of its receipt of documents:

(1) To honor;

(2) If the letter of credit provides for honor to be completed more than seven business days after presentation, to accept a draft or incur a deferred obligation; or

(3) To give notice to the presenter of discrepancies in the presentation.

(c) Except as otherwise provided in subsection (d), an issuer is precluded from asserting as a basis for dishonor any discrepancy if timely notice is not given, or any discrepancy not stated in the notice if timely notice is given.

(d) Failure to give the notice specified in subsection (b) or to mention fraud, forgery, or expiration in the notice does not preclude the issuer from asserting as a basis for dishonor fraud or forgery as described in § 57A-5-109(a) or expiration of the letter of credit before presentation.

(e) An issuer shall observe standard practice of financial institutions that regularly issue letters of credit. Determination of the issuer's observance of the standard practice is a matter of interpretation for the court. The court shall offer the parties a reasonable opportunity to present evidence of the standard practice.

(f) An issuer is not responsible for:

(1) The performance or nonperformance of the underlying contract, arrangement, or transaction;

(2) An act or omission of others; or

(3) Observance or knowledge of the usage of a particular trade other than the standard practice referred to in subsection (e).

(g) If an undertaking constituting a letter of credit under § 57A-5-102(a)(10) contains nondocumentary conditions, an issuer shall disregard the nondocumentary conditions and treat them as if they were not stated.

(h) An issuer that has dishonored a presentation shall return the documents or hold them at the disposal of, and send advice to that effect to, the presenter.

(i) An issuer that has honored a presentation as permitted or required by this chapter:

(1) Is entitled to be reimbursed by the applicant in immediately available funds not later than the date of its payment of funds;

(2) Takes the documents free of claims of the beneficiary or presenter;

(3) Is precluded from asserting a right of recourse on a draft under §§ 57A-3-414 and 57A-3-415 ;

(4) Except as otherwise provided in §§ 57A-5-110 and 57A-5-117 , is precluded from restitution of money paid or other value given by mistake to the extent the mistake concerns discrepancies in the documents or tender which are apparent on the face of the presentation; and

(5) Is discharged to the extent of its performance under the letter of credit unless the issuer honored a presentation in which a required signature of a beneficiary was forged.

Source: SL 1998, ch 283, § 1.
S.D. Codified Laws § 57A-2-327 — SD Code / Title 57A / Chapter 2 / Section 57A-2-327
Special incidents of sale on approval and sale or return
Status: in_force

(1) Under a sale on approval unless otherwise agreed

(a) Although the goods are identified to the contract the risk of loss and the title do not pass to the buyer until acceptance; and

(b) Use of the goods consistent with the purpose of trial is not acceptance but failure seasonably to notify the seller of election to return the goods is acceptance, and if the goods conform to the contract acceptance of any part is acceptance of the whole; and

(c) After due notification of election to return, the return is at the seller's risk and expense but a merchant buyer must follow any reasonable instructions.

(2) Under a sale or return unless otherwise agreed

(a) The option to return extends to the whole or any commercial unit of the goods while in substantially their original condition, but must be exercised seasonably; and

(b) The return is at the buyer's risk and expense.

Source: SL 1966, ch 150, § 2-327; SDCL, §§ 57-4-68, 57-4-69.
S.D. Codified Laws § 57A-3-505 — SD Code / Title 57A / Chapter 3 / Section 57A-3-505
Evidence of dishonor
Status: in_force

(a) The following are admissible as evidence and create a presumption of dishonor and of any notice of dishonor stated:

(1) A document regular in form as provided in subsection (b) which purports to be a protest;

(2) A purported stamp or writing of the drawee, payor bank, or presenting bank on or accompanying the instrument stating that acceptance or payment has been refused unless reasons for the refusal are stated and the reasons are not consistent with dishonor;

(3) A book or record of the drawee, payor bank, or collecting bank, kept in the usual course of business which shows dishonor, even if there is no evidence of who made the entry.

(b) A protest is a certificate of dishonor made by a United States consul or vice consul, or a notary public or other person authorized to administer oaths by the law of the place where dishonor occurs. It may be made upon information satisfactory to that person. The protest must identify the instrument and certify either that presentment has been made or, if not made, the reason why it was not made, and that the instrument has been dishonored by nonacceptance or nonpayment. The protest may also certify that notice of dishonor has been given to some or all parties.

Source: SL 1994, ch 367, § 3-505.
S.D. Codified Laws § 57A-9-609.2 — SD Code / Title 57A / Chapter 9 / Section 57A-9-609.2
Farm products fraud--Misdemeanor
Status: in_force

Any person who for himself, or through an agent, sells livestock through a livestock auction agency, as defined in chapter 40-15 and § 301 of the Packers and Stockyards Act (7 USC 201), or who so sells grain through a public grain warehouse, or through a public terminal grain warehouse, or a grain dealer as defined in chapters 49-43 , 49-44 , and 49-45 respectively, without notifying the livestock auction agency or the grain warehouse or grain dealer of a security interest in such farm products, and with intent to defraud, is guilty of farm products fraud. The failure of the seller to give written notice of a security interest in the farm products prior to the date of the sale by the livestock auction agency, or the grain warehouse, or grain dealer, is prima facie evidence of intent to defraud.

A violation of this section is a Class 1 misdemeanor.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-2A-509 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-509
Lessee's rights on improper delivery--Rightful rejection
Status: in_force

(1) Subject to the provisions of § 57A-2A-510 , on default in installment lease contracts, if the goods or the tender or delivery fail in any respect to conform to the lease contract, the lessee may reject or accept the goods or accept any commercial unit or units and reject the rest of the goods.

(2) Rejection of goods is ineffective unless it is within a reasonable time after tender or delivery of the goods and the lessee seasonably notifies the lessor.

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-2-316.1 — SD Code / Title 57A / Chapter 2 / Section 57A-2-316.1
Cattle, hogs and sheep--No implied warranty as to disease
Status: in_force

Notwithstanding § 57A-2-316 , there is no implied warranty on the sale of cattle, hogs, or sheep that such cattle, hogs, or sheep are free from disease.

Source: SL 1980, ch 345.
S.D. Codified Laws § 57A-9-311 — SD Code / Title 57A / Chapter 9 / Section 57A-9-311
Perfection of security interests in property subject to certain statutes, regulations, and treaties
Status: in_force

(a) Except as otherwise provided in subsection (d), the filing of a financing statement is not necessary or effective to perfect a security interest in property subject to:

(1) A statute, regulation, or treaty of the United States whose requirements for a security interest's obtaining priority over the rights of a lien creditor with respect to the property preempt § 57A-9-310(a);

(2) A certificate-of-title statute of this state under the law of which indication of a security interest on the certificate of title is required as a condition of perfection; or

(3) A statute of another jurisdiction which provides for a security interest to be indicated on a certificate of title as a condition or result of the security interest's obtaining priority over the rights of a lien creditor with respect to the property.

(b) Compliance with the requirements of a statute, regulation, or treaty described in subsection (a) for obtaining priority over the rights of a lien creditor is equivalent to the filing of a financing statement under this article. Except as otherwise provided in subsection (d) and §§ 57A-9-313 and 57A-9-316(d) and (e) for goods covered by a certificate of title, a security interest in property subject to a statute, regulation, or treaty described in subsection (a) may be perfected only by compliance with those requirements, and a security interest so perfected remains perfected notwithstanding a change in the use or transfer of possession of the collateral.

(c) Except as otherwise provided in subsection (d) and § 57A-9-316(d) and (e), duration and renewal of perfection of a security interest perfected by compliance with the requirements prescribed by a statute, regulation, or treaty described in subsection (a) are governed by the statute, regulation, or treaty. In other respects, the security interest is subject to this article.

(d) During any period in which collateral subject to a statute specified in subsection (a)(2) is inventory held for sale or lease by a person or leased by that person as lessor and that person is in the business of selling goods of that kind, this section does not apply to a security interest in that collateral created by that person.

Source: SL 2000, ch 231; SL 2012, ch 238, § 4, eff. July 1, 2013.
S.D. Codified Laws § 57A-9-322 — SD Code / Title 57A / Chapter 9 / Section 57A-9-322
Priority among conflicting security interests and agricultural liens in same collateral
Status: in_force

(a) Except as otherwise provided in this section, priority among conflicting security interests and agricultural liens in the same collateral is determined according to the following rules:

(1) Conflicting perfected security interests and agricultural liens rank according to priority in time of filing or perfection. Priority dates from the earlier of the time a filing covering the collateral is first made or the security interest or agricultural lien is first perfected, if there is no period thereafter when there is neither filing nor perfection.

(2) A perfected security interest or agricultural lien has priority over a conflicting unperfected security interest or agricultural lien.

(3) The first security interest or agricultural lien to attach or become effective has priority if conflicting security interests and agricultural liens are unperfected.

(b) For the purposes of subsection (a)(1):

(1) the time of filing or perfection as to a security interest in collateral is also the time of filing or perfection as to a security interest in proceeds; and

(2) the time of filing or perfection as to a security interest in collateral supported by a supporting obligation is also the time of filing or perfection as to a security interest in the supporting obligation.

(c) Except as otherwise provided in subsection (f), a security interest in collateral which qualifies for priority over a conflicting security interest under § 57A-9-327 , 57A-9-328 , 57A-9-329 , 57A-9-330 , or 57A-9-331 also has priority over a conflicting security interest in:

(1) Any supporting obligation for the collateral; and

(2) Proceeds of the collateral if:

(A) The security interest in proceeds is perfected;

(B) The proceeds are cash proceeds or of the same type as the collateral; and

(C) In the case of proceeds that are proceeds of proceeds, all intervening proceeds are cash proceeds, proceeds of the same type as the collateral, or an account relating to the collateral.

(d) Subject to subsection (e) and except as otherwise provided in subsection (f), if a security interest in chattel paper, deposit accounts, negotiable documents, instruments, investment property, or letter - of - credit rights is perfected by a method other than filing, conflicting perfected security interests in proceeds of the collateral rank according to priority in time of filing.

(e) Subsection (d) applies only if the proceeds of the collateral are not cash proceeds, chattel paper, negotiable documents, instruments, investment property, or letter - of - credit rights.

(f) Subsections (a) through (e) are subject to:

(1) Subsection (g) and the other provisions of this part;

(2) Section 57A-4-210 with respect to a security interest of a collecting bank;

(3) Section 57A-5-118 with respect to a security interest of an issuer or nominated person; and

(4) Section 57A-9-110 with respect to a security interest arising under chapter 57A-2 or 57A-2A .

(g) A perfected agricultural lien on collateral has priority over a conflicting security interest in or agricultural lien on the same collateral if the statute creating the agricultural lien so provides.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-9-204 — SD Code / Title 57A / Chapter 9 / Section 57A-9-204
After-acquired property--Future advances
Status: in_force

(a) Except as otherwise provided in subsection (b), a security agreement may create or provide for a security interest in after - acquired collateral.

(b) Subject to subsection (b.1), a security interest does not attach under a term constituting an after - acquired property clause to:

(1) Consumer goods, other than an accession when given as additional security, unless the debtor acquires rights in them within 10 days after the secured party gives value; or

(2) A commercial tort claim.

(b.1) Subsection (b) does not prevent a security interest from attaching:

(1) To consumer goods as proceeds under § 57A-9-315 (a) or commingled goods under § 57A-9-336 (c);

(2) To a commercial tort claim as proceeds under § 57A-9-315 (a); or

(3) Under an after-acquired property clause to property that is proceeds of consumer goods or a commercial tort claim.

(c) A security agreement may provide that collateral secures, or that accounts, chattel paper, payment intangibles, or promissory notes are sold in connection with, future advances or other value, whether or not the advances or value are given pursuant to commitment.

Source: SL 2000, ch 231; SL 2024, ch 198, § 50.
S.D. Codified Laws § 57A-4-216 — SD Code / Title 57A / Chapter 4 / Section 57A-4-216
Insolvency and preference
Status: in_force

(a) If an item is in or comes into the possession of a payor or collecting bank that suspends payment and the item has not been finally paid, the item must be returned by the receiver, trustee, or agent in charge of the closed bank to the presenting bank or the closed bank's customer.

(b) If a payor bank finally pays an item and suspends payments without making a settlement for the item with its customer or the presenting bank which settlement is or becomes final, the owner of the item has a preferred claim against the payor bank.

(c) If a payor bank gives or a collecting bank gives or receives a provisional settlement for an item and thereafter suspends payments, the suspension does not prevent or interfere with the settlement's becoming final if the finality occurs automatically upon the lapse of certain time or the happening of certain events.

(d) If a collecting bank receives from subsequent parties settlement for an item, which settlement is or becomes final and the bank suspends payments without making a settlement for the item with its customer which settlement is or becomes final, the owner of the item has a preferred claim against the collecting bank.

Source: SL 1994, ch 368, § 4-216.
S.D. Codified Laws § 57A-2A-402 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-402
Anticipatory repudiation
Status: in_force

(1) If either party repudiates a lease contract, other than a consumer lease, with respect to a performance not yet due under the lease contract, the loss of which performance will substantially impair the value of the lease contract to the other, the aggrieved party may:

(a) For a commercially reasonable time, await retraction of repudiation and performance by the repudiating party;

(b) Make demand pursuant to § 57A-2A-401 , and await assurance of future performance adequate under the circumstances of the particular case; or

(c) Resort to any right or remedy upon default under the lease contract or this chapter, even though the aggrieved party has notified the repudiating party that the aggrieved party would await the repudiating party's performance and assurance and has urged retraction. In addition, whether or not the aggrieved party is pursuing one of the foregoing remedies, the aggrieved party may suspend performance or, if the aggrieved party is the lessor, proceed in accordance with the provisions of this chapter on the lessor's right to identify goods to the lease contract notwithstanding default or to salvage unfinished goods pursuant to § 57A-2A-524 .

(2) The rights and remedies of the parties to a consumer lease in connection with a repudiation of that lease shall be determined under other laws, and this section shall not affect the applicability or interpretation of those laws.

Source: SL 1989, ch 419, § 1; SL 1990, ch 390, § 13.
S.D. Codified Laws § 57A-2-319 — SD Code / Title 57A / Chapter 2 / Section 57A-2-319
F.O.B. and F.A.S. terms
Status: in_force

(1) Unless otherwise agreed the term F.O.B. (which means "free on board") at a named place, even though used only in connection with the stated price, is a delivery term under which

(a) When the term is F.O.B. the place of shipment, the seller must at that place ship the goods in the manner provided in this chapter (§ 57A-2-504 ) and bear the expense and risk of putting them into the possession of the carrier; or

(b) When the term is F.O.B. the place of destination, the seller must at his own expense and risk transport the goods to that place and there tender delivery of them in the manner provided in this chapter (§ 57A-2-503 );

(c) When under either (a) or (b) the term is also F.O.B. vessel, car or other vehicle, the seller must in addition at his own expense and risk load the goods on board. If the term is F.O.B. vessel the buyer must name the vessel and in an appropriate case the seller must comply with the provisions of this chapter on the form of bill of lading (§ 57A-2-323 ).

(2) Unless otherwise agreed the term F.A.S. vessel (which means "free alongside") at a named port, even though used only in connection with the stated price, is a delivery term under which the seller must

(a) At his own expense and risk deliver the goods alongside the vessel in the manner usual in that port or on a dock designated and provided by the buyer; and

(b) Obtain and tender a receipt for the goods in exchange for which the carrier is under a duty to issue a bill of lading.

(3) Unless otherwise agreed in any case falling within subsection (1)(a) or (c) or subsection (2) the buyer must seasonably give any needed instructions for making delivery, including when the term is F.A.S. or F.O.B. the loading berth of the vessel and in an appropriate case its name and sailing date. The seller may treat the failure of needed instructions as a failure of cooperation under this chapter (§ 57A-2-311 ). He may also at his option move the goods in any reasonable manner preparatory to delivery or shipment.

(4) Under the term F.O.B. vessel or F.A.S. 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, § 2-319; SDCL, §§ 57-4-42 to 57-4-45.
S.D. Codified Laws § 57A-8-208 — SD Code / Title 57A / Chapter 8 / Section 57A-8-208
Effect of signature of authenticating trustee, registrar, or transfer agent
Status: in_force

(a) A person signing a security certificate as authenticating trustee, registrar, transfer agent, or the like, warrants to a purchaser for value of the certificated security, if the purchaser is without notice of a particular defect, that:

(1) The certificate is genuine;

(2) The person's own participation in the issue of the security is within the person's capacity and within the scope of the authority received by the person from the issuer; and

(3) The person has reasonable grounds to believe that the certificated security is in the form and within the amount the issuer is authorized to issue.

(b) Unless otherwise agreed, a person signing under subsection (a) does not assume responsibility for the validity of the security in other respects.

Source: SL 1998, ch 284, § 1.
S.D. Codified Laws § 57A-9-627 — SD Code / Title 57A / Chapter 9 / Section 57A-9-627
What constitutes commercially reasonable collection, enforcement, disposition, or acceptance
Status: in_force

(a) The fact that a greater amount could have been obtained by a collection, enforcement, disposition, or acceptance at a different time or in a different method from that selected by the secured party is not of itself sufficient to preclude the secured party from establishing that the collection, enforcement, disposition, or acceptance was made in a commercially reasonable manner.

(b) A disposition of collateral is made in a commercially reasonable manner if the disposition is made:

(1) In the usual manner on any recognized market;

(2) By the price current in any recognized market at the time of the disposition; or

(3) Otherwise in conformity with reasonable commercial practices among dealers in the type of property that was the subject of the disposition.

(c) A collection, enforcement, disposition, or acceptance is commercially reasonable if it has been approved:

(1) In a judicial proceeding;

(2) By a bona fide creditors' committee;

(3) By a representative of creditors; or

(4) By an assignee for the benefit of creditors.

(d) Approval under subsection (c) need not be obtained, and lack of approval does not mean that the collection, enforcement, disposition, or acceptance is not commercially reasonable.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-9-207 — SD Code / Title 57A / Chapter 9 / Section 57A-9-207
Rights and duties of secured party having possession or control of collateral
Status: in_force

(a) Except as otherwise provided in subsection (d), a secured party shall use reasonable care in the custody and preservation of collateral in the secured party's possession. In the case of chattel paper or an instrument, reasonable care includes taking necessary steps to preserve rights against prior parties unless otherwise agreed.

(b) Except as otherwise provided in subsection (d), if a secured party has possession of collateral:

(1) Reasonable expenses, including the cost of insurance and payment of taxes or other charges, incurred in the custody, preservation, use, or operation of the collateral are chargeable to the debtor and are secured by the collateral;

(2) The risk of accidental loss or damage is on the debtor to the extent of a deficiency in any effective insurance coverage;

(3) The secured party shall keep the collateral identifiable, but fungible collateral may be commingled; and

(4) The secured party may use or operate the collateral:

(A) For the purpose of preserving the collateral or its value;

(B) As permitted by an order of a court having competent jurisdiction; or

(C) Except in the case of consumer goods, in the manner and to the extent agreed by the debtor.

(c) Except as otherwise provided in subsection (d), a secured party having possession of collateral or control of collateral under § 57A-7-106 , 57A-9-104 , 57A-9-105 , 57A-9-105.1 , 57A-9-106 , 57A-9-107 , or 57A-9-107.1 :

(1) May hold as additional security any proceeds, except money or funds, received from the collateral;

(2) Shall apply money or funds received from the collateral to reduce the secured obligation, unless remitted to the debtor; and

(3) May create a security interest in the collateral.

(d) If the secured party is a buyer of accounts, chattel paper, payment intangibles, or promissory notes or a consignor:

(1) Subsection (a) does not apply unless the secured party is entitled under an agreement:

(A) To charge back uncollected collateral; or

(B) Otherwise to full or limited recourse against the debtor or a secondary obligor based on the nonpayment or other default of an account debtor or other obligor on the collateral; and

(2) Subsections (b) and (c) do not apply.

Source: SL 2000, ch 231; SL 2009, ch 254, § 827; SL 2024, ch 198, § 51.
S.D. Codified Laws § 57A-2-514 — SD Code / Title 57A / Chapter 2 / Section 57A-2-514
When documents deliverable on acceptance--When on payment
Status: in_force

Unless otherwise agreed documents against which a draft is drawn are to be delivered to the drawee on acceptance of the draft if it is payable more than three days after presentment; otherwise, only on payment.

Source: SL 1966, ch 150, § 2-514; SDCL, § 57-6-37.
S.D. Codified Laws § 57A-3-404 — SD Code / Title 57A / Chapter 3 / Section 57A-3-404
Impostors--Fictitious payees
Status: in_force

(a) If an impostor, by use of the mails or otherwise, induces the issuer of an instrument to issue the instrument to the impostor, or to a person acting in concert with the impostor, by impersonating the payee of the instrument or a person authorized to act for the payee, an indorsement of the instrument by any person in the name of the payee is effective as the indorsement of the payee in favor of a person who, in good faith, pays the instrument or takes it for value or for collection.

(b) If (i) a person whose intent determines to whom an instrument is payable (§ 57A-3-110(a) or (b)) does not intend the person identified as payee to have any interest in the instrument, or (ii) the person identified as payee of an instrument is a fictitious person, the following rules apply until the instrument is negotiated by special indorsement:

(1) Any person in possession of the instrument is its holder.

(2) An indorsement by any person in the name of the payee stated in the instrument is effective as the indorsement of the payee in favor of a person who, in good faith, pays the instrument or takes it for value or for collection.

(c) Under subsection (a) or (b), an indorsement is made in the name of a payee if (i) it is made in a name substantially similar to that of the payee or (ii) the instrument, whether or not indorsed, is deposited in a depositary bank to an account in a name substantially similar to that of the payee.

(d) With respect to an instrument to which subsection (a) or (b) applies, if a person paying the instrument or taking it for value or for collection fails to exercise ordinary care in paying or taking the instrument and that failure substantially contributes to loss resulting from payment of the instrument, the person bearing the loss may recover from the person failing to exercise ordinary care to the extent the failure to exercise ordinary care contributed to the loss.

Source: SL 1994, ch 367, § 3-404.
S.D. Codified Laws § 57A-3-309 — SD Code / Title 57A / Chapter 3 / Section 57A-3-309
Enforcement of lost, destroyed, or stolen instrument
Status: in_force

(a) A person not in possession of an instrument is entitled to enforce the instrument if (i) the person was in possession of the instrument and entitled to enforce it when loss of possession occurred, (ii) the loss of possession was not the result of a transfer by the person or a lawful seizure, and (iii) the person cannot reasonably obtain possession of the instrument because the instrument was destroyed, its whereabouts cannot be determined, or it is in the wrongful possession of an unknown person or a person that cannot be found or is not amenable to service of process.

(b) A person seeking enforcement of an instrument under subsection (a) must prove the terms of the instrument and the person's right to enforce the instrument. If that proof is made, § 57A-3-308 applies to the case as if the person seeking enforcement had produced the instrument. The court may not enter judgment in favor of the person seeking enforcement unless it finds that the person required to pay the instrument is adequately protected against loss that might occur by reason of a claim by another person to enforce the instrument. Adequate protection may be provided by any reasonable means.

Source: SL 1994, ch 367, § 3-309.
S.D. Codified Laws § 57A-2A-104 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-104
Leases subject to other statutes
Status: in_force

(1) A lease, although subject to this chapter, is also subject to any applicable:

(a) Statute of the United States;

(b) Certificate of title statute of this state;

(c) Certificate of title statute of another jurisdiction (§ 57A-2A-105 ); or

(d) Consumer protection statute of this state.

(2) In case of conflict between the provisions of this chapter, other than §§ 57A-2A-105 , 57A-2A-304(3) and 57A-2A-305(3), and any statute referred to in subsection (1) of this section, the provisions of that statute control.

(3) Failure to comply with any applicable statute has only the effect specified therein.

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-4-209 — SD Code / Title 57A / Chapter 4 / Section 57A-4-209
Encoding and retention warranties
Status: in_force

(a) A person who encodes information on or with respect to an item after issue warrants to any subsequent collecting bank and to the payor bank or other payor that the information is correctly encoded. If the customer of a depositary bank encodes, that bank also makes the warranty.

(b) A person who undertakes to retain an item pursuant to an agreement for electronic presentment warrants to any subsequent collecting bank and to the payor bank or other payor that retention and presentment of the item comply with the agreement. If a customer of a depositary bank undertakes to retain an item, that bank also makes this warranty.

(c) A person to whom warranties are made under this section 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, plus expenses and loss of interest incurred as a result of the breach.

Source: SL 1994, ch 368, § 4-209.
S.D. Codified Laws § 57A-2A-523 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-523
Lessor's rights
Status: in_force

(1) If a lessee wrongfully rejects or revokes acceptance of goods or fails to make a payment when due or repudiates with respect to a part or the whole, then, with respect to any goods involved, and with respect to all of the goods if under an installment lease contract the value of the whole lease contract is substantially impaired (§ 57A-2A-510 ), the lessee is in default under the lease contract and the lessor may:

(a) Cancel the lease contract (§ 57A-2A-505(1));

(b) Proceed respecting goods not identified to the lease contract (§ 57A-2A-524 );

(c) Withhold delivery of the goods and take possession of goods previously delivered (§ 57A-2A-525 );

(d) Stop delivery of the goods by any bailee (§ 57A-2A-526 );

(e) Dispose of the goods and recover damages (§ 57A-2A-527 ), or retain the goods and recover damages (§ 57A-2A-528 ), or in a proper case recover rent (§ 57A-2A-529 ).

(2) If a lessee is otherwise in default under a lease contract, the lessor may exercise any right or remedy provided in this chapter except to the extent that this chapter makes the right or remedy available only upon the occurrence of a default in subsection (1) of this section.

Source: SL 1989, ch 419, § 1; SL 1990, ch 390, § 22.
S.D. Codified Laws § 57A-4A-505 — SD Code / Title 57A / Chapter 4A / Section 57A-4A-505
Preclusion of objection to debit of customer's account
Status: in_force

If a receiving bank has received payment from its customer with respect to a payment order issued in the name of the customer as sender and accepted by the bank, and the customer received notification reasonably identifying the order, the customer is precluded from asserting that the bank is not entitled to retain the payment unless the customer notifies the bank of the customer's objection to the payment within one year after the notification was received by the customer.

Source: SL 1991, ch 397, § 1.
S.D. Codified Laws § 57A-9-608 — SD Code / Title 57A / Chapter 9 / Section 57A-9-608
Application of proceeds of collection or enforcement--Liability for deficiency and right to surplus
Status: in_force

(a) If a security interest or agricultural lien secures payment or performance of an obligation, the following rules apply:

(1) A secured party shall apply or pay over for application the cash proceeds of collection or enforcement under § 57A-9-607 in the following order to:

(A) The reasonable expenses of collection and enforcement 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;

(B) The satisfaction of obligations secured by the security interest or agricultural lien under which the collection or enforcement is made; and

(C) The satisfaction of obligations secured by any subordinate security interest in or other lien on the collateral subject to the security interest or agricultural lien under which the collection or enforcement is made if the secured party receives a signed demand for proceeds before distribution of the proceeds is completed.

(2) 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 complies, the secured party need not comply with the holder's demand under paragraph (1)(C).

(3) A secured party need not apply or pay over for application noncash proceeds of collection and enforcement under § 57A-9-607 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.

(4) A secured party shall account to and pay a debtor for any surplus, and the obligor is liable for any deficiency.

(b) If the underlying transaction is a sale of accounts, chattel paper, payment intangibles, or promissory notes, the debtor is not entitled to any surplus, and the obligor is not liable for any deficiency.

Source: SL 2000, ch 231; SL 2024, ch 198, § 82.
S.D. Codified Laws § 57A-9-409 — SD Code / Title 57A / Chapter 9 / Section 57A-9-409
Ineffective restrictions on assignment or creation of security interest in letter-of-credit right
Status: in_force

(a) A term in a letter of credit or a rule of law, statute, regulation, custom, or practice applicable to the letter of credit which prohibits, restricts, or requires the consent of an applicant, issuer, or nominated person to a beneficiary's assignment of or creation of a security interest in a letter - of - credit right is ineffective to the extent that the term or rule of law, statute, regulation, custom, or practice:

(1) Would impair the creation, attachment, or perfection of a security interest in the letter - of - credit right; or

(2) Provides that the assignment or the creation, attachment, or perfection of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the letter - of - credit right.

(b) To the extent that a term in a letter of credit is ineffective under subsection (a) but would be effective under law other than this chapter or a custom or practice applicable to the letter of credit, to the transfer of a right to draw or otherwise demand performance under the letter of credit, or to the assignment of a right to proceeds of the letter of credit, the creation, attachment, or perfection of a security interest in the letter - of - credit right:

(1) Is not enforceable against the applicant, issuer, nominated person, or transferee beneficiary;

(2) Imposes no duties or obligations on the applicant, issuer, nominated person, or transferee beneficiary; and

(3) Does not require the applicant, issuer, nominated person, or transferee beneficiary to recognize the security interest, pay or render performance to the secured party, or accept payment or other performance from the secured party.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-2-515 — SD Code / Title 57A / Chapter 2 / Section 57A-2-515
Preserving evidence of goods in dispute
Status: in_force

In furtherance of the adjustment of any claim or dispute

(a) Either party on reasonable notification to the other and for the purpose of ascertaining the facts and preserving evidence has the right to inspect, test and sample the goods including such of them as may be in the possession or control of the other; and

(b) The parties may agree to a third - party inspection or survey to determine the conformity or condition of the goods and may agree that the findings shall be binding upon them in any subsequent litigation or adjustment.

Source: SL 1966, ch 150, § 2-515; SDCL, §§ 57-6-38, 57-6-39.
S.D. Codified Laws § 57A-7-204 — SD Code / Title 57A / Chapter 7 / Section 57A-7-204
Duty of care--Contractual limitation of warehouse's liability
Status: in_force

(a) A warehouse is liable for damages for loss of or injury to the goods caused by its failure to exercise care with regard to the goods that a reasonably careful person would exercise under similar circumstances. However, unless otherwise agreed, the warehouse is not liable for damages that could not have been avoided by the exercise of that care.

(b) Damages may be limited by a term in the warehouse receipt or storage agreement limiting the amount of liability in case of loss or damage beyond which the warehouse is not liable. Such a limitation is not effective with respect to the warehouse's liability for conversion to its own use. The warehouse's liability, on request of the bailor in a record at the time of signing such storage agreement or within a reasonable time after receipt of the warehouse receipt, may be increased on part or all of the goods covered by the storage agreement or the warehouse receipt. In this event, increased rates may be charged based on an increased valuation of the goods.

(c) Reasonable provisions as to the time and manner of presenting claims and commencing actions based on the bailment may be included in the warehouse receipt or storage agreement.

(d) This section does not impair or repeal chapters 49-42 to 49-45 , inclusive.

Source: SL 2009, ch 254, § 7-204.
S.D. Codified Laws § 57A-9-321 — SD Code / Title 57A / Chapter 9 / Section 57A-9-321
"Licensee in ordinary course of business"--Rights with respect to security interest--Rights of lessee in ordinary course of business
Status: in_force

(a) In this section, "licensee in ordinary course of business" means a person that becomes a licensee of a general intangible in good faith, without knowledge that the license violates the rights of another person in the general intangible, and in the ordinary course from a person in the business of licensing general intangibles of that kind. A person becomes a licensee in the ordinary course if the license to the person comports with the usual or customary practices in the kind of business in which the licensor is engaged or with the licensor's own usual or customary practices.

(b) A licensee in ordinary course of business takes its rights under a nonexclusive license free of a security interest in the general intangible created by the licensor, even if the security interest is perfected and the licensee knows of its existence.

(c) A lessee in ordinary course of business takes its leasehold interest free of a security interest in the goods created by the lessor, even if the security interest is perfected and the lessee knows of its existence.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-7-505 — SD Code / Title 57A / Chapter 7 / Section 57A-7-505
Indorser not guarantor for other parties
Status: in_force

The indorsement of a tangible document of title issued by a bailee does not make the indorser liable for any default by the bailee or previous indorsers.

Source: SL 2009, ch 254, § 7-505.
S.D. Codified Laws § 57A-2A-306 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-306
Priority of certain liens arising by operation of law
Status: in_force

If a person in the ordinary course of his business furnishes services or materials with respect to goods subject to a lease contract, a lien upon those goods in the possession of that person given by statute or rule of law for those materials or services takes priority over any interest of the lessor or lessee under the lease contract or this chapter unless the lien is created by statute and the statute provides otherwise or unless the lien is created by rule of law and the rule of law provides otherwise.

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-4-202 — SD Code / Title 57A / Chapter 4 / Section 57A-4-202
Responsibility for collection or return--When action timely
Status: in_force

(a) A collecting bank must exercise ordinary care in:

(1) Presenting an item or sending it for presentment;

(2) Sending notice of dishonor or nonpayment or returning an item other than a documentary draft to the bank's transferor after learning that the item has not been paid or accepted, as the case may be;

(3) Settling for an item when the bank receives final settlement; and

(4) Notifying its transferor of any loss or delay in transit within a reasonable time after discovery thereof.

(b) A collecting bank exercises ordinary care under subsection (a) by taking proper action before its midnight deadline following receipt of an item, notice, or settlement. Taking proper action within a reasonably longer time may constitute the exercise of ordinary care, but the bank has the burden of establishing timeliness.

(c) Subject to subsection (a)(1), a bank is not liable for the insolvency, neglect, misconduct, mistake, or default of another bank or person or for loss or destruction of an item in the possession of others or in transit.

Source: SL 1994, ch 368, § 4-202.
S.D. Codified Laws § 57A-9-807 — SD Code / Title 57A / Chapter 9 / Section 57A-9-807
Amendment of pre-effective-date financing statement
Status: in_force

(a) In this section, "pre-effective-date financing statement" means a financing statement filed before July 1, 2013.

(b) After SL 2012, ch 238 takes effect, a person may add or delete collateral covered by, continue or terminate the effectiveness of, or otherwise amend the information provided in, a pre-effective-date financing statement only in accordance with the law of the jurisdiction governing perfection as provided in chapter 57A-9 as amended by SL 2012, ch 238. However, the effectiveness of a pre-effective-date financing statement also may be terminated in accordance with the law of the jurisdiction in which the financing statement is filed.

(c) Except as otherwise provided in subsection (d), if the law of this state governs perfection of a security interest, the information in a pre-effective-date financing statement may be amended after SL 2012, ch 238 takes effect only if:

(1) The pre-effective-date financing statement and an amendment are filed in the office specified in § 57A-9-501 ;

(2) An amendment is filed in the office specified in § 57A-9-501 concurrently with, or after the filing in that office of, an initial financing statement that satisfies § 57A-9-806(c); or

(3) An initial financing statement that provides the information as amended and satisfies § 57A-9-806(c) is filed in the office specified in § 57A-9-501 .

(d) If the law of this state governs perfection of a security interest, the effectiveness of a pre-effective-date financing statement may be continued only under § 57A-9-805(c) and (e) or § 57A-9-806 .

(e) Whether or not the law of this state governs perfection of a security interest, the effectiveness of a pre-effective-date financing statement filed in this state may be terminated after SL 2012, ch 238 takes effect by filing a termination statement in the office in which the pre-effective-date financing statement is filed, unless an initial financing statement that satisfies § 57A-9-806(c) has been filed in the office specified by the law of the jurisdiction governing perfection as provided in chapter 57A-9 as amended by SL 2012, ch 238 as the office in which to file a financing statement.

Source: SL 2012, ch 238, § 9-807, eff. July 1, 2013.
S.D. Codified Laws § 57A-2-317 — SD Code / Title 57A / Chapter 2 / Section 57A-2-317
Cumulation and conflict of warranties express or implied
Status: in_force

Warranties whether express or implied shall be construed as consistent with each other and as cumulative, but if such construction is unreasonable the intention of the parties shall determine 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 1966, ch 150, § 2-317; SDCL, § 57-4-40.
S.D. Codified Laws § 57A-2A-217 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-217
Identification
Status: in_force

Identification of goods as goods to which a lease contract refers may be made at any time and in any manner explicitly agreed to by the parties. In the absence of explicit agreement, identification occurs:

(a) When the lease contract is made if the lease contract is for a lease of goods that are existing and identified;

(b) When the goods are shipped, marked, or otherwise designated by the lessor as goods to which the lease contract refers, if the lease contract is for a lease of goods that are not existing and identified; or

(c) When the young are conceived, if the lease contract is for a lease of unborn young of animals.

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-9-330 — SD Code / Title 57A / Chapter 9 / Section 57A-9-330
Priority of purchaser of chattel paper or instrument
Status: in_force

(a) A purchaser of chattel paper has priority over a security interest in the chattel paper which is claimed merely as proceeds of inventory subject to a security interest if:

(1) In good faith and in the ordinary course of the purchaser's business, the purchaser gives new value, takes possession of each authoritative tangible copy of the record evidencing the chattel paper, and obtains control under § 57A-9-105 of each authoritative electronic copy of the record evidencing the chattel paper; and

(2) The authoritative copies of the record evidencing the chattel paper do not indicate that the chattel paper has been assigned to an identified assignee other than the purchaser.

(b) A purchaser of chattel paper has priority over a security interest in the chattel paper which is claimed other than merely as proceeds of inventory subject to a security interest if the purchaser gives new value, takes possession of each authoritative tangible copy of the record evidencing the chattel paper, and obtains control under § 57A-9-105 of each authoritative electronic copy of the record evidencing the chattel paper in good faith, in the ordinary course of the purchaser's business, and without knowledge that the purchase violates the rights of the secured party.

(c) Except as otherwise provided in § 57A-9-327 , a purchaser having priority in chattel paper under subsection (a) or (b) also has priority in proceeds of the chattel paper to the extent that:

(1) Section 57A-9-322 provides for priority in the proceeds; or

(2) The proceeds consist of the specific goods covered by the chattel paper or cash proceeds of the specific goods, even if the purchaser's security interest in the proceeds is unperfected.

(d) Except as otherwise provided in § 57A-9-331 (a), a purchaser of an instrument has priority over a security interest in the instrument perfected by a method other than possession if the purchaser gives value and takes possession of the instrument in good faith and without knowledge that the purchase violates the rights of the secured party.

(e) For purposes of subsections (a) and (b), the holder of a purchase - money security interest in inventory gives new value for chattel paper constituting proceeds of the inventory.

(f) For purposes of subsections (b) and (d), if the authoritative copies of the record evidencing chattel paper or an instrument indicate that the chattel paper or instrument has been assigned to an identified secured party other than the purchaser, a purchaser of the chattel paper or instrument has knowledge that the purchase violates the rights of the secured party.

Source: SL 2000, ch 231; SL 2024, ch 198, § 70.
S.D. Codified Laws § 57A-2-703 — SD Code / Title 57A / Chapter 2 / Section 57A-2-703
Seller's remedies in general
Status: in_force

Where the buyer wrongfully rejects or revokes acceptance of goods or fails to make a payment due on or before delivery or repudiates with respect to a part or the whole, then with respect to any goods directly affected and, if the breach is of the whole contract (§ 57A-2-612 ), then also with respect to the whole undelivered balance, the aggrieved seller may

(a) Withhold delivery of such goods;

(b) Stop delivery by any bailee as hereafter provided (§ 57A-2-705 );

(c) Proceed under § 57A-2-704 respecting goods still unidentified to the contract;

(d) Resell and recover damages as hereafter provided (§ 57A-2-706 );

(e) Recover damages for nonacceptance (§ 57A-2-708 ) or in a proper case the price (§ 57A-2-709 );

(f) Cancel.

Source: SL 1966, ch 150, § 2-703; SDCL, § 57-8-5.
S.D. Codified Laws § 57A-4-208 — SD Code / Title 57A / Chapter 4 / Section 57A-4-208
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 that pays or accepts 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 purported drawer of the draft is unauthorized.

(b) A drawee making payment may recover from a 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 (i) breach of warranty is a defense to the obligation of the acceptor, and (ii) if the acceptor makes payment with respect to the draft, the acceptor is entitled to recover from a 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 item is presented for payment to a party obliged to pay the item, and the item is paid, the person obtaining payment and a prior transferor of the item warrant to the person making payment in good faith that the warrantor is, or was, at the time the warrantor transferred the item, a person entitled to enforce the item or authorized to obtain payment on behalf of a person entitled to enforce the item. 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 warrantor 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 368, § 4-208.
S.D. Codified Laws § 57A-4A-203 — SD Code / Title 57A / Chapter 4A / Section 57A-4A-203
Unenforceability of certain verified payment orders
Status: in_force

(a) If an accepted payment order is not, under § 57A-4A-202 (a), an authorized order of a customer identified as sender, but is effective as an order of the customer pursuant to § 57A-4A-202 (b), the following rules apply:

(1) By express agreement evidenced by a record, the receiving bank may limit the extent to which it is entitled to enforce or retain payment of the payment order.

(2) The receiving bank is not entitled to enforce or retain payment of the payment order if the customer proves that the order was not caused, directly or indirectly, by a person (i) entrusted at any time with duties to act for the customer with respect to payment orders or the security procedures, or (ii) who obtained access to transmitting facilities of the customer or who obtained, from a source controlled by the customer and without authority of the receiving bank, information facilitating breach of the security procedure, regardless of how the information was obtained or whether the customer was at fault. Information includes any access device, computer software or the like.

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

Source: SL 1991, ch 397, § 1; SL 2024, ch 198, § 28.
S.D. Codified Laws § 57A-2A-101 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-101
Short title
Status: in_force

This chapter shall be known and may be cited as the Uniform Commercial Code--Leases.

Source: SL 1989, ch 419, § 1.
S.D. Codified Laws § 57A-1-203 — SD Code / Title 57A / Chapter 1 / Section 57A-1-203
Lease distinguished from security interest
Status: in_force

(a) Whether a transaction in the form of a lease creates a lease or security interest is determined by the facts of each case.

(b) A transaction in the form of a lease creates a security interest if the consideration that the lessee is to pay the lessor for the right to possession and use of the goods is an obligation for the term of the lease and is not subject to termination by the lessee, and:

(1) The original term of the lease is equal to or greater than the remaining economic life of the goods;

(2) The lessee is bound to renew the lease for the remaining economic life of the goods or is bound to become the owner of the goods;

(3) The lessee has an option to renew the lease for the remaining economic life of the goods for no additional consideration or for nominal additional consideration upon compliance with the lease agreement; or

(4) The lessee has an option to become the owner of the goods for no additional consideration or for nominal additional consideration upon compliance with the lease agreement.

(c) A transaction in the form of a lease does not create a security interest merely because:

(1) The present value of the consideration the lessee is obligated to pay the lessor for the right to possession and use of the goods is substantially equal to or is greater than the fair market value of the goods at the time the lease is entered into;

(2) The lessee assumes risk of loss of the goods;

(3) The lessee agrees to pay, with respect to the goods, taxes, insurance, filing, recording, or registration fees, or service or maintenance costs;

(4) The lessee has an option to renew the lease or to become the owner of the goods;

(5) The lessee has an option to renew the lease for a fixed rent that is equal to or greater than the reasonably predictable fair market rent for the use of the goods for the term of the renewal at the time the option is to be performed; or

(6) The lessee has an option to become the owner of the goods for a fixed price that is equal to or greater than the reasonably predictable fair market value of the goods at the time the option is to be performed.

(d) Additional consideration is nominal if it is less than the lessee's reasonably predictable cost of performing under the lease agreement if the option is not exercised. Additional consideration is not nominal if:

(1) When the option to renew the lease is granted to the lessee, the rent is stated to be the fair market rent for the use of the goods for the term of the renewal determined at the time the option is to be performed; or

(2) When the option to become the owner of the goods is granted to the lessee, the price is stated to be the fair market value of the goods determined at the time the option is to be performed.

(e) The "remaining economic life of the goods" and "reasonably predictable" fair market rent, fair market value, or cost of performing under the lease agreement must be determined with reference to the facts and circumstances at the time the transaction is entered into.

Source: SL 2008, ch 259, § 11.
S.D. Codified Laws § 57A-1-106 — SD Code / Title 57A / Chapter 1 / Section 57A-1-106
Use of singular and plural--Gender
Status: in_force

In this title, unless the statutory context otherwise requires:

(1) Words in the singular number include the plural, and those in the plural include the singular; and

(2) Words of any gender also refer to any other gender.

Source: SL 2008, ch 259, § 6.
S.D. Codified Laws § 57A-7-504 — SD Code / Title 57A / Chapter 7 / Section 57A-7-504
Rights acquired in absence of due negotiation--Effect of diversion--Stoppage of delivery
Status: in_force

(a) A transferee of a document of title, whether negotiable or nonnegotiable, to which the document has been delivered but not duly negotiated, acquires the title and rights that its transferor had or had actual authority to convey.

(b) In the case of a nonnegotiable document of title, until but not after the bailee receives notice of the transfer, the rights of the transferee may be defeated:

(1) By those creditors of the transferor that could treat the transfer as void under § 57A-2-402 or 57-2A-308;

(2) By a buyer from the transferor in ordinary course of business if the bailee has delivered the goods to the buyer or received notification of the buyer's rights;

(3) By a lessee from the transferor in ordinary course of business if the bailee has delivered the goods to the lessee or received notification of the lessee's rights; or

(4) As against the bailee, by good faith dealings of the bailee with the transferor.

(c) A diversion or other change of shipping instructions by the consignor in a nonnegotiable bill of lading which causes the bailee not to deliver the goods to the consignee defeats the consignee's title to the goods if the goods have been delivered to a buyer in ordinary course of business or a lessee in ordinary course of business and in any event defeats the consignee's rights against the bailee.

(d) Delivery of the goods pursuant to a nonnegotiable document of title may be stopped by a seller under § 57A-2-705 or a lessor under § 57A-2A-526 , subject to the requirements of due notification in those sections. A bailee honoring the seller's or lessor's instructions is entitled to be indemnified by the seller or lessor against any resulting loss or expense.

Source: SL 2009, ch 254, § 7-504.
S.D. Codified Laws § 57A-1-207 — SD Code / Title 57A / Chapter 1 / Section 57A-1-207
Central bank digital currency
Status: in_force

Nothing in SL 2024, ch 198 is intended or can be construed to create or adopt a central bank digital currency.

Source: SL 2024, ch 198, § 3.
S.D. Codified Laws § 57A-9-609.1 — SD Code / Title 57A / Chapter 9 / Section 57A-9-609.1
Action for recovery of security by creditor against third party purchaser of farm products--Limitation period--Offer to file criminal complaint
Status: in_force

No cause of action for recovery of security or its value may be commenced by a secured creditor against an innocent third - party purchaser of farm products as defined in subsection (34) of § 57A-9-102 , nor may such a cause of action be commenced against a livestock auction agency, as defined in chapter 40-15 and § 301 of the Packers and Stockyards Act (7 USC 201), or a public grain warehouse, or a public terminal grain warehouse, or a grain dealer as defined by chapters 49-43 , 49-44 , and 49-45 respectively, unless such action is commenced within twenty - four months from the date the farm products are sold and unless such action is preceded by the secured creditor offering to file against the debtor, a complaint as defined by § 23A-2-1 .

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-2-316 — SD Code / Title 57A / Chapter 2 / Section 57A-2-316
Exclusion or modification of warranties
Status: in_force

(1) Words or conduct relevant to the creation of an express warranty and words or conduct tending to negate or limit warranty shall be construed wherever reasonable as consistent with each other; but subject to the provisions of this chapter on parol or extrinsic evidence (§ 57A-2-202 ) negation or limitation is inoperative to the extent that such construction is unreasonable.

(2) Subject to subsection (3), to exclude or modify the implied warranty of merchantability or any part of it the language must mention merchantability and in case of a writing must be conspicuous, and to exclude or modify any implied warranty of fitness the exclusion must be by a writing and conspicuous. Language to exclude all implied warranties of fitness is sufficient if it states, for example, that "there are no warranties which extend beyond the description on the face hereof."

(3) Notwithstanding subsection (2),

(a) unless the circumstances indicate otherwise, all implied warranties are excluded by expressions like "as is," "with all faults" or other language which in common understanding calls the buyer's attention to the exclusion of warranties and makes plain that there is no implied warranty; and

(b) when the buyer before entering into the contract has examined the goods or the sample or model as fully as he desired or has refused to examine the goods there is no implied warranty with regard to defects which an examination ought in the circumstances to have revealed to him; and

(c) an implied warranty can also be excluded or modified by course of dealing or course of performance or usage of trade.

(4) Remedies for breach of warranty can be limited in accordance with the provisions of this chapter on liquidation or limitation of damages and on contractual modification of remedy (§§ 57A-2-718 and 57A-2-719 ).

Source: SL 1966, ch 150, § 2-316; SDCL, §§ 57-4-34 to 57-4-39.
S.D. Codified Laws § 57A-13-306 — SD Code / Title 57A / Chapter 13 / Section 57A-13-306
Priority of claims when priority rules of chapter57A-9do not apply
Status: in_force

(a) Subject to subsection (b) and (c), chapter 57A-12 determines the priority of conflicting claims to Article 12 property when the priority rules of chapter 57A-9 as amended by SL 2024, ch 198 do not apply.

(b) Subject to subsection (c), when the priority rules of chapter 57A-9 as amended by SL 2024, ch 198 do not apply, to the extent the priorities determined by SL 2024, ch 198 modify the priorities established before July 1, 2024, the priorities of claims to Article 12 property were established before July 1, 2024, law other than chapter 57A-12 determines priority.

(c) When the priority rules of chapter 57A-9 as amended by SL 2024, ch 198 do not apply, to the extent the priorities determined by SL 2024, ch 198 modify the priorities established before July 1, 2024, the priorities of claims to Article 12 property established before July 1, 2024, cease to apply on the adjustment date.

Source: SL 2024, ch 198, § 109.
S.D. Codified Laws § 57A-9-338 — SD Code / Title 57A / Chapter 9 / Section 57A-9-338
Effect of inaccurate financing statement on security interest or agricultural lien
Status: in_force

If a security interest or agricultural lien is perfected by a filed financing statement providing information described in § 57A-9-516(b)(5) which is incorrect at the time the financing statement is filed:

(1) The security interest or agricultural lien is subordinate to a conflicting perfected security interest in the collateral to the extent that the holder of the conflicting security interest gives value in reasonable reliance upon the incorrect information; and

(2) A purchaser, other than a secured party, of the collateral takes free of the security interest or agricultural lien to the extent that, in reasonable reliance upon the incorrect information, the purchaser gives value and, in the case of tangible chattel paper, tangible documents, goods, instruments, or a security certificate, receives delivery of the collateral.

Source: SL 2000, ch 231; SL 2009, ch 254, § 835.
S.D. Codified Laws § 57A-7-306 — SD Code / Title 57A / Chapter 7 / Section 57A-7-306
Altered bills of lading
Status: in_force

An unauthorized alteration or filling in of a blank in a bill of lading leaves the bill enforceable according to its original tenor.

Source: SL 2009, ch 254, § 7-306.
S.D. Codified Laws § 57A-9-209 — SD Code / Title 57A / Chapter 9 / Section 57A-9-209
Duties of secured party if account debtor has been notified of assignment
Status: in_force

(a) Except as otherwise provided in subsection (c), this section applies if:

(1) There is no outstanding secured obligation; and

(2) The secured party is not committed to make advances, incur obligations, or otherwise give value.

(b) Within 10 days after receiving a signed demand by the debtor, a secured party shall send to an account debtor that has received notification under § 57A-9-406 (a) or 57A-12-106 of an assignment to the secured party as assignee a signed record that releases the account debtor from any further obligation to the secured party.

(c) This section does not apply to an assignment constituting the sale of an account, chattel paper, or payment intangible.

Source: SL 2000, ch 231; SL 2024, ch 198, § 53.
S.D. Codified Laws § 57A-9-320 — SD Code / Title 57A / Chapter 9 / Section 57A-9-320
Rights of buyer in ordinary course of business--Buyer of goods from seller who bought or used them for personal or household use
Status: in_force

(a) Except as otherwise provided in subsection (e), a buyer in ordinary course of business, other than a person buying farm products from a person engaged in farming operations, takes free of a security interest created by the buyer's seller, even if the security interest is perfected and the buyer knows of its existence.

(b) Except as otherwise provided in subsection (e), a buyer of goods from a person who used or bought the goods for use primarily for personal, family, or household purposes takes free of a security interest, even if perfected, if the buyer buys:

(1) Without knowledge of the security interest;

(2) For value;

(3) Primarily for the buyer's personal, family, or household purposes; and

(4) Before the filing of a financing statement covering the goods.

(c) To the extent that it affects the priority of a security interest over a buyer of goods under subsection (b), the period of effectiveness of a filing made in the jurisdiction in which the seller is located is governed by § 57A-9-316(a) and (b).

(d) A buyer in ordinary course of business buying oil, gas, or other minerals at the wellhead or minehead or after extraction takes free of an interest arising out of an encumbrance.

(e) Subsections (a) and (b) do not affect a security interest in goods in the possession of the secured party under § 57A-9-313 .

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-9-526 — SD Code / Title 57A / Chapter 9 / Section 57A-9-526
Rules and practices for filing offices
Status: in_force

(a) The secretary of state shall adopt rules to implement this chapter. The filing - office rules must be:

(1) Consistent with this chapter; and

(2) Adopted and published in accordance with chapter 1-26 .

(b) To keep the filing - office rules and practices of the filing office in harmony with the rules and practices of filing offices in other jurisdictions that enact substantially this part, and to keep the technology used by the filing office compatible with the technology used by filing offices in other jurisdictions that enact substantially this part, the secretary of state's office, so far as is consistent with the purposes, policies, and provisions of this chapter, in adopting, amending, and repealing filing - office rules, shall:

(1) Consult with filing offices in other jurisdictions that enact substantially this part; and

(2) Consult the most recent version of the Model Rules promulgated by the International Association of Corporate Administrators or any successor organization; and

(3) Take into consideration the rules and practices of, and the technology used by, filing offices in other jurisdictions that enact substantially this part.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-1-103 — SD Code / Title 57A / Chapter 1 / Section 57A-1-103
Construction of title to promote its purposes and policies--Applicability of supplemental principles of law
Status: in_force

(a) This title shall be liberally construed and applied to promote its underlying purposes and policies, which are:

(1) To simplify, clarify, and modernize the law governing commercial transactions;

(2) To permit the continued expansion of commercial practices through custom, usage, and agreement of the parties; and

(3) To make uniform the law among the various jurisdictions.

(b) Unless displaced by the particular provisions of this title, the principles of law and equity, including the law merchant and the law relative to capacity to contract, principal and agent, estoppel, fraud, misrepresentation, duress, coercion, mistake, bankruptcy, and other validating or invalidating cause supplement its provisions.

Source: SL 2008, ch 259, § 3.
S.D. Codified Laws § 57A-9-808 — SD Code / Title 57A / Chapter 9 / Section 57A-9-808
Person entitled to file initial financing statement or continuation statement
Status: in_force

A person may file an initial financing statement or a continuation statement under this part if:

(1) The secured party of record authorizes the filing; and

(2) The filing is necessary under this part:

(A) To continue the effectiveness of a financing statement filed before July 1, 2013; or

(B) To perfect or continue the perfection of a security interest.

Source: SL 2012, ch 238, § 9-808, eff. July 1, 2013.
S.D. Codified Laws § 57A-2A-307 — SD Code / Title 57A / Chapter 2A / Section 57A-2A-307
Priority of liens arising by attachment or levy on, security interests in, and other claims to goods
Status: in_force

(1) Except as otherwise provided in § 57A-2A-306 , a creditor of a lessee takes subject to the lease contract.

(2) Except as otherwise provided in subsection (3) of this section and in §§ 57A-2A-306 and 57A-2A-308 , a creditor of a lessor takes subject to the lease contract unless the creditor holds a lien that attached to the goods before the lease contract became enforceable.

(3) Except as otherwise provided in Sections 9-317, 9-321, and 9-323, a lessee takes a leasehold interest subject to a security interest held by a creditor of the lessor.

Source: SL 1989, ch 419, § 1; SL 1990, ch 390, § 10; SL 2000, ch 231, § 9.
S.D. Codified Laws § 57A-8-112 — SD Code / Title 57A / Chapter 8 / Section 57A-8-112
Creditor's legal process
Status: in_force

(a) The interest of a debtor in a certificated security may be reached by a creditor only by actual seizure of the security certificate by the officer making the attachment or levy, except as otherwise provided in subsection (d). However, a certificated security for which the certificate has been surrendered to the issuer may be reached by a creditor by legal process upon the issuer.

(b) The interest of a debtor in an uncertificated security may be reached by a creditor only by legal process upon the issuer at its chief executive office in the United States, except as otherwise provided in subsection (d).

(c) The interest of a debtor in a security entitlement may be reached by a creditor only by legal process upon the securities intermediary with whom the debtor's securities account is maintained, except as otherwise provided in subsection (d).

(d) The interest of a debtor in a certificated security for which the certificate is in the possession of a secured party, or in an uncertificated security registered in the name of a secured party, or a security entitlement maintained in the name of a secured party, may be reached by a creditor by legal process upon the secured party.

(e) A creditor whose debtor is the owner of a certificated security, uncertificated security, or security entitlement is entitled to aid from a court of competent jurisdiction, by injunction or otherwise, in reaching the certificated security, uncertificated security, or security entitlement or in satisfying the claim by means allowed at law or in equity in regard to property that cannot readily be reached by other legal process.

Source: SL 1998, ch 284, § 1.
S.D. Codified Laws § 57A-9-317 — SD Code / Title 57A / Chapter 9 / Section 57A-9-317
Interests that take priority over or take free of security interests or agricultural lien
Status: in_force

(a) A security interest or agricultural lien is subordinate to the rights of:

(1) A person entitled to priority under § 57A-9-322 ; and

(2) Except as otherwise provided in subsection (e), a person that becomes a lien creditor before the earlier of the time:

(A) The security interest or agricultural lien is perfected; or

(B) One of the conditions specified in § 57A-9-203 (b)(3) is met and a financing statement covering the collateral is filed.

(b) Except as otherwise provided in subsection (e), a buyer, other than a secured party, of goods, instruments, tangible documents, or a certified security takes free of a security interest or agricultural lien if the buyer gives value and receives delivery of the collateral without knowledge of the security interest or agricultural lien and before it is perfected.

(c) Except as otherwise provided in subsection (e), a lessee of goods takes free of a security interest or agricultural lien if the lessee gives value and receives delivery of the collateral without knowledge of the security interest or agricultural lien and before it is perfected.

(d) Subject to subsections (f) through (i), a licensee of a general intangible or a buyer, other than a secured party, of collateral other than electronic money, goods, instruments, tangible documents, or a certificated security takes free of a security interest if the licensee or buyer gives value without knowledge of the security interest and before it is perfected.

(e) Except as otherwise provided in § 57A-9-320 and 57A-9-321 , if a person files a financing statement with respect to a purchase-money security interest before or within 20 days after the debtor receives delivery of the collateral, the security interest takes priority over the rights of a buyer, lessee, or lien creditor which arise between the time the security interest attaches and the time of filing.

(f) A buyer, other than a secured party, of chattel paper takes free of a security interest if, without knowledge of the security interest and before it is perfected, the buyer gives value and:

(1) Receives delivery of each authoritative tangible copy of the record evidencing the chattel paper; and

(2) If each authoritative electronic copy of the record evidencing the chattel paper can be subjected to control under § 57A-9-105 , obtains control of each authoritative electronic copy.

(g) A buyer of an electronic document takes free of a security interest if, without knowledge of the security interest and before it is perfected, the buyer gives value and, if each authoritative electronic copy of the document can be subjected to control under § 57A-7-106 , obtains control of each authoritative electronic copy.

(h) A buyer of a controllable electronic record takes free of a security interest if, without knowledge of the security interest and before it is perfected, the buyer gives value and obtains control of each controllable electronic record.

(i) A buyer, other than a secured party, of a controllable account or a controllable payment intangible takes free of a security interest if, without knowledge of the security interest and before it is perfected, the buyer gives value and obtains control of the controllable account or controllable payment intangible.

Source: SL 2000, ch 231; SL 2009, ch 254, § 834; SL 2012, ch 238, § 6, eff. July 1, 2013; SL 2024, ch 198, § 66.
S.D. Codified Laws § 57A-8-501 — SD Code / Title 57A / Chapter 8 / Section 57A-8-501
Securities account; acquisition of security entitlement from securities intermediary
Status: in_force

(a) "Securities account" means an account to which a financial asset is or may be credited in accordance with an agreement under which the person maintaining the account undertakes to treat the person for whom the account is maintained as entitled to exercise the rights that comprise the financial asset.

(b) Except as otherwise provided in subsections (d) and (e), a person acquires a security entitlement if a securities intermediary:

(1) Indicates by book entry that a financial asset has been credited to the person's securities account;

(2) Receives a financial asset from the person or acquires a financial asset for the person and, in either case, accepts it for credit to the person's securities account; or

(3) Becomes obligated under other law, regulation, or rule to credit a financial asset to the person's securities account.

(c) If a condition of subsection (b) has been met, a person has a security entitlement even though the securities intermediary does not itself hold the financial asset.

(d) If a securities intermediary holds a financial asset for another person, and the financial asset is registered in the name of, payable to the order of, or specially indorsed to the other person, and has not been indorsed to the securities intermediary or in blank, the other person is treated as holding the financial asset directly rather than as having a security entitlement with respect to the financial asset.

(e) Issuance of a security is not establishment of a security entitlement.

Source: SL 1998, ch 284, § 1.
S.D. Codified Laws § 57A-9-602 — SD Code / Title 57A / Chapter 9 / Section 57A-9-602
Waiver or variance of rules by debtor or obligor
Status: in_force

Except as otherwise provided in § 57A-9-624 , to the extent that they give rights to a debtor or obligor and impose duties on a secured party, the debtor or obligor may not waive or vary the rules stated in the following listed sections:

(1) Section 57A-9-207(b)(4)(C), which deals with use and operation of the collateral by the secured party;

(2) Section 57A-9-210 , which deals with requests for an accounting and requests concerning a list of collateral and statement of account;

(3) Section 57A-9-607(c), which deals with collection and enforcement of collateral;

(4) Sections 57A-9-608(a) and 57A-9-615(c) to the extent that they deal with application or payment of noncash proceeds of collection, enforcement, or disposition;

(5) Sections 57A-9-608(a) and 57A-9-615(d) to the extent that they require accounting for or payment of surplus proceeds of collateral;

(6) Section 57A-9-609 to the extent that it imposes upon a secured party that takes possession of collateral without judicial process the duty to do so without breach of the peace;

(7) Sections 57A-9-610(b), 57A-9-611 , 57A-9-613 , and 57A-9-614 , which deal with disposition of collateral;

(8) Section 57A-9-615(f), which deals with calculation of a deficiency or surplus when a disposition is made to the secured party, a person related to the secured party, or a secondary obligor;

(9) Section 57A-9-616 , which deals with explanation of the calculation of a surplus or deficiency;

(10) Sections 57A-9-620 , 57A-9-621 , and 57A-9-622 , which deal with acceptance of collateral in satisfaction of obligation;

(11) Section 57A-9-623 , which deals with redemption of collateral;

(12) Section 57A-9-624 , which deals with permissible waivers; and

(13) Sections 57A-9-625 and 57A-9-626 , which deal with the secured party's liability for failure to comply with this chapter.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-2-301 — SD Code / Title 57A / Chapter 2 / Section 57A-2-301
General obligation of parties
Status: in_force

The obligation of the seller is to transfer and deliver and that of the buyer is to accept and pay in accordance with the contract.

Source: SL 1966, ch 150, § 2-301; SDCL, § 57-4-1.
S.D. Codified Laws § 57A-8-101 — SD Code / Title 57A / Chapter 8 / Section 57A-8-101
Short title
Status: in_force

This chapter may be cited as Uniform Commercial Code--Investment Securities.

Source: SL 1998, ch 284, § 1.
S.D. Codified Laws § 57A-8-302 — SD Code / Title 57A / Chapter 8 / Section 57A-8-302
Rights of purchaser
Status: in_force

(a) Except as otherwise provided in subsections (b) and (c), a purchaser of a certificated or uncertificated security acquires all rights in the security that the transferor had or had power to transfer.

(b) A purchaser of a limited interest acquires rights only to the extent of the interest purchased.

(c) A purchaser of a certificated security who as a previous holder had notice of an adverse claim does not improve its position by taking from a protected purchaser.

Source: SL 1998, ch 284, § 1; SL 2000, ch 231, § 18.
S.D. Codified Laws § 57A-4-204 — SD Code / Title 57A / Chapter 4 / Section 57A-4-204
Methods of sending and presenting--Sending directly to payor bank
Status: in_force

(a) A collecting bank shall send items by a reasonably prompt method, taking into consideration relevant instructions, the nature of the item, the number of those items on hand, the cost of collection involved, and the method generally used by it or others to present those items.

(b) A collecting bank may send:

(1) An item directly to the payor bank;

(2) An item to a nonbank payor if authorized by its transferor; and

(3) An item other than documentary drafts to a nonbank payor, if authorized by federal reserve regulation or operating circular, clearing - house rule, or the like.

(c) Presentment may be made by a presenting bank at a place where the payor bank or other payor has requested that presentment be made.

Source: SL 1994, ch 368, § 4-204.
S.D. Codified Laws § 57A-7-603 — SD Code / Title 57A / Chapter 7 / Section 57A-7-603
Conflicting claims--Interpleader
Status: in_force

If more than one person claims title to or possession of the goods, the bailee is excused from delivery until the bailee has a reasonable time to ascertain the validity of the adverse claims or to commence an action for interpleader. The bailee may assert an interpleader either in defending an action for nondelivery of the goods or by original action.

Source: SL 2009, ch 254, § 7-603.
S.D. Codified Laws § 57A-7-502 — SD Code / Title 57A / Chapter 7 / Section 57A-7-502
Rights acquired by due negotiation
Status: in_force

(a) Subject to §§ 57A-7-205 and 57A-7-503 , a holder to which a negotiable document of title has been duly negotiated acquires thereby:

(1) Title to the document;

(2) Title to the goods;

(3) All rights accruing under the law of agency or estoppel, including rights to goods delivered to the bailee after the document was issued; and

(4) The direct obligation of the issuer to hold or deliver the goods according to the terms of the document free of any defense or claim by the issuer except those arising under the terms of the document or under this chapter. In the case of a delivery order, the bailee's obligation accrues only upon the bailee's acceptance of the delivery order and the obligation acquired by the holder is that the issuer and any indorser will procure the acceptance of the bailee.

(b) Subject to § 57A-7-503 , title and rights acquired by due negotiation are not defeated by any stoppage of the goods represented by the document of title or by surrender of the goods by the bailee and are not impaired even if:

(1) The due negotiation or any prior due negotiation constituted a breach of duty;

(2) Any person has been deprived of possession of a negotiable tangible document or control of a negotiable electronic document by misrepresentation, fraud, accident, mistake, duress, loss, theft, or conversion; or

(3) A previous sale or other transfer of the goods or document has been made to a third person.

Source: SL 2009, ch 254, § 7-502.
S.D. Codified Laws § 57A-11-101A — SD Code / Title 57A / Chapter 11 / Section 57A-11-101A
Transition to 1999 Act--General rule
Status: in_force

A transaction arising out of or associated with a letter of credit that was issued before July 1, 1999, and the rights, obligations, and interests flowing from that transaction are governed by any statute or other law amended or repealed by this Act as if repeal or amendment had not occurred and may be terminated, completed, consummated, or enforced under that statute or other law.

Source: SL 1998, ch 283, §§ 4, 5.
S.D. Codified Laws § 57A-9-521 — SD Code / Title 57A / Chapter 9 / Section 57A-9-521
Forms for financing statement, amendment to statement, and addendum for either
Status: in_force

(a) A filing office that accepts written records may not refuse to accept a written initial financing statement in the following form and format except for a reason set forth in § 57A-9-516(b).

(b) A filing office that accepts written records may not refuse to accept a written record in the following form and format except for a reason set forth in § 57A-9-516(b).

Source: SL 2000, ch 231; SL 2012, ch 238, § 16, eff. July 1, 2013.
S.D. Codified Laws § 57A-9-604 — SD Code / Title 57A / Chapter 9 / Section 57A-9-604
Procedure if obligation secured by security interest in personal property or fixtures is also secured by interest in real property
Status: in_force

(a) If a security agreement covers both personal and real property, a secured party may proceed:

(1) Under this part as to the personal property without prejudicing any rights with respect to the real property; or

(2) As to both the personal property and the real property in accordance with the rights with respect to the real property, in which case the other provisions of this part do not apply.

(b) Subject to subsection (c), if a security agreement covers goods that are or become fixtures, a secured party may proceed:

(1) Under this part; or

(2) In accordance with the rights with respect to real property, in which case the other provisions of this part do not apply.

(c) Subject to the other provisions of this part, if a secured party holding a security interest in fixtures has priority over all owners and encumbrancers of the real property, the secured party, after default, may remove the collateral from the real property.

(d) A secured party that removes collateral shall promptly reimburse any encumbrancer or owner of the real property, other than the debtor, for the cost of repair of any physical injury caused by the removal. The secured party need not reimburse the encumbrancer or owner for any diminution in value of the real property caused by the absence of the goods removed or by any necessity of replacing them. 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-9-701 — SD Code / Title 57A / Chapter 9 / Section 57A-9-701
Effective date of chapter
Status: in_force

This chapter is effective on July 1, 2001, and on July 1, 2001, chapter 57A-9 is repealed.

Source: SL 2000, ch 231.
S.D. Codified Laws § 57A-3-306 — SD Code / Title 57A / Chapter 3 / Section 57A-3-306
Claims to an instrument
Status: in_force

A person taking an instrument, other than a person having rights of a holder in due course, is subject to a claim of a property or possessory right in the instrument or its proceeds, including a claim to rescind a negotiation and to recover the instrument or its proceeds. A person having rights of a holder in due course takes free of the claim to the instrument.

Source: SL 1994, ch 367, § 3-306.
S.D. Codified Laws § 57A-8-508 — SD Code / Title 57A / Chapter 8 / Section 57A-8-508
Duty of securities intermediary to change entitlement holder's position to other form of security holding
Status: in_force

A securities intermediary shall act at the direction of an entitlement holder to change a security entitlement into another available form of holding for which the entitlement holder is eligible, or to cause the financial asset to be transferred to a securities account of the entitlement holder with another securities intermediary. A securities intermediary satisfies the duty if:

(1) The securities intermediary acts as agreed upon by the entitlement holder and the securities intermediary; or

(2) In the absence of agreement, the securities intermediary exercises due care in accordance with reasonable commercial standards to follow the direction of the entitlement holder.

Source: SL 1998, ch 284, § 1.
S.D. Codified Laws § 57A-1-304 — SD Code / Title 57A / Chapter 1 / Section 57A-1-304
Obligation of good faith
Status: in_force

Every contract or duty within this title imposes an obligation of good faith in its performance and enforcement.

Source: SL 2008, ch 259, § 18.