#25604-rev & rem-JKK 

2011 S.D. 4

IN THE SUPREME COURT 

OF THE 

STATE OF SOUTH DAKOTA 

* * * * 

BUFFALO RIDGE CORPORATION, Plaintiff and Appellant, 

v. 

LAMAR ADVERTISING OF 

SOUTH DAKOTA, INC., Defendant and Appellee. 

* * * * 

APPEAL FROM THE CIRCUIT COURT OF 

THE SECOND JUDICIAL CIRCUIT 

MINNEHAHA COUNTY, SOUTH DAKOTA 

* * * * 

HONORABLE STUART L. TIEDE 

Judge 

* * * * 

DANIEL K. BRENDTRO of 

Zimmer Duncan & Cole, LLP Attorneys for plaintiff 

Sioux Falls, South Dakota and appellant. 

JOHN K. NOONEY 

AARON T. GALLOWAY of 

Nooney, Solay & Van Norman, LLP Attorneys for defendant 

Rapid City, South Dakota and appellee. 

* * * * 

CONSIDERED ON BRIEFS 

ON JANUARY 10, 2011 

 OPINION FILED 01/26/11 
-1- 

#25604 

KONENKAMP, Justice 

[¶1.] In this dispute over billboard leases, we reverse and remand for 

further proceedings. 

Background 

[¶2.] In 2001, Flynn Advertising contracted with Buffalo Ridge Corporation 

to lease certain real property along Interstate 90, near Sioux Falls, South Dakota. 

Flynn would construct several billboards on the leased property. The parties 

executed four written lease agreements, encompassing five billboard sites. The 

agreements identified the specific mile markers where the billboards were to be 

located. Each lease had a three-year term, with an automatic renewal for an 

additional three years, unless Buffalo Ridge gave notice of termination in the final 

month of the lease. The rental rates were $250 per sign, per month, paid quarterly. 

Each lease had the following provision: “[i]n the event that the lease is not renewed 

at a mutually agreed on term and price, the Lessor [Buffalo Ridge] shall, at [its] 

option, have the right to purchase from the Lessee [Flynn, or its successors], at the 

current replacement value, all materials which are located on the structure and 

owned by the Lessee.” 

[¶3.] Flynn later assigned its interest in the leases to Lamar Outdoor 

Advertising of South Dakota, Inc. In 2006, Buffalo Ridge began terminating its 

leases with Lamar. One lease was set to expire on September 1, 2006, two on 

November 1, 2006, and one on February 1, 2007. Buffalo Ridge informed Lamar 

that if it wished to continue leasing the property, the new rental rate would be $750 

per month for each lease, on a month-to-month basis, with interest at 1.5% per 
#25604 

-2- 

 

month for late payments. Lamar declined the new rental terms, and negotiations 

for different terms were unsuccessful. 

[¶4.] On November 1, 2006, a Lamar employee, Doug Rumpca, tried to 

remove one or more of the billboard structures from Buffalo Ridge’s property. Brad 

Songstad, the president of Buffalo Ridge, told Rumpca not to take the billboard 

structures down. Songstad reminded Rumpca that Buffalo Ridge had a purchase 

option under the lease agreements. Songstad also proposed different lease terms: 

$650 per month for each billboard site.1 Again Lamar declined. Despite Lamar’s 

most recent rejection of Buffalo Ridge’s new lease terms, it continued to negotiate 

with Buffalo Ridge. Lamar continued to collect revenue from its billboard 

advertising, while paying Buffalo Ridge $250 per month on each of the leases. 

Buffalo Ridge did not cash any of the checks. 

[¶5.] On June 20, 2007, Buffalo Ridge served a notice to quit on Lamar and 

then brought suit a week later for (1) a writ of eviction against Lamar, (2) an order 

enjoining Lamar from removing any of the materials or structures, (3) an order 

allowing Buffalo Ridge to exercise its purchase option under the leases, and (4) an 

award of “all past due rent, lost profits, damages, late fees, and interest in an 

amount to be determined at the time of trial.” Lamar answered claiming that the 

1. There are two other billboard sites leased to Lamar by Buffalo Ridge. Those 

billboards are not at issue in this case because they automatically renewed 

(July 1, 2006) before Buffalo Ridge indicated its intent to change the lease 

terms. Songstad’s proposal to Rumpca for $650 per month for all billboards 

included the two billboards not part of this case. 
#25604 

-3- 

” 

t 

 

leases were still valid and enforceable and moved to dismiss Buffalo Ridge’s 

complaint. 

[¶6.] Following a court trial in November 2007, the circuit court issued its 

oral findings and conclusions.2 It found that Lamar “is the owner of everything 

that was used to erect each of those billboards except the material located on the 

east side but subject to the option right of the lessor to purchase certain materials.

It concluded that although Buffalo Ridge did not expressly terminate the leases, i

gave notice to Lamar that the rental terms were going to change. Negotiations 

never resulted in a “meeting of the minds or an agreement as to those terms and 

conditions and particularly the amount of the rent.” The court recognized that the 

parties were in limbo: “Lamar was unwilling to pay the rent demanded by the 

landlord. The landlord was unwilling to accept the rent offered by the tenant and 

the landlord wouldn’t permit the tenant to remove.” Because the parties could not 

reach an agreement, the court ruled that Buffalo Ridge was entitled to have its land 

back and granted Lamar an opportunity to remove the billboard structures, subject 

to Buffalo Ridge’s option to purchase them. The court allowed “a period of thirty 

days within which [Buffalo Ridge], if it’s going to exercise its option, to indicate that 

it intends to exercise it[.]” If, after thirty days, Buffalo Ridge failed to exercise its 

option, the court gave “an additional thirty days to Lamar to then remove all of the 

property that belongs to it[.]” 

2. The transcript of this trial is not in the record. 
#25604 

-4- 

 

[¶7.] In the course of the court’s oral ruling, the parties and court also 

discussed when the court’s decision would take effect. It was agreed that the court 

would issue a judgment of eviction, but delay signing it. The delay would allow 

settlement negotiations on the value of the replacement cost of the billboard 

structures if Buffalo Ridge decided to exercise its option to purchase. At the 

conclusion of the hearing, it was decided that the thirty/sixty day time frame would 

start the day the order was signed. 

[¶8.] From November 28, 2007 until May 15, 2008, Buffalo Ridge and Lamar 

continued negotiations, which proved unsuccessful. On May 15, 2008, Buffalo Ridge 

tendered to Lamar what it considered the replacement value of the billboard 

structures. As part of its tender, it gave Lamar the uncashed rent checks Lamar 

had sent Buffalo Ridge, amounting to $35,250.00, along with a Buffalo Ridge 

corporate check for $2,667.17, all totaling $37,917.17. Lamar did not accept the 

tender. 

[¶9.] On July 16, 2008, Buffalo Ridge executed the court’s November 28, 

2007 judgment for delivery of possession. A court trial was held on October 5, 2009, 

to determine the “current replacement value” of the billboard materials and what 

damages Buffalo Ridge may be entitled to. At trial, the parties stipulated that 

Buffalo Ridge exercised its option to purchase on December 27, 2007, which 

stipulation was accepted by the court.3 At the conclusion of the trial, the court 

 (continued . . .) 

3. After an off-the-record discussion about the effective date of the stipulation, 

the court stated, “Mr. Nooney [counsel for Lamar] has admitted and 

stipulated to the effective date of the exercise of the options; is that what you 

are telling me?” Mr. Nooney: “Yes, Your Honor, that’s correct.” The court: 
#25604 

-5- 

__________________ 

(. . . continued) 

directed Buffalo Ridge and Lamar to address the damages issue in their proposed 

findings and conclusions. 

[¶10.] On February 3, 2010, the court issued findings of fact and conclusions 

of law. Contrary to the parties’ stipulation, the court found that Buffalo Ridge 

exercised its option to purchase on November 1, 2006. It also found that after 

November 1, 2006, Buffalo Ridge and Lamar “continued intermittent 

negotiations[.]” During the negotiation period, Lamar continued to pay Buffalo 

Ridge $250 per month into 2009 and Buffalo Ridge refused to cash or negotiate the 

rent checks. The court acknowledged that, on November 28, 2007, it entered oral 

findings and conclusions on Buffalo Ridge’s action for eviction, an injunction, and 

declaratory relief, and gave “Buffalo Ridge thirty days to exercise the option to 

purchase all the materials located on the billboard structures[.]” It declared that 

“Buffalo Ridge had first informed Lamar of the intention of Buffalo Ridge to exercise 

its option to purchase the materials on the structures on or about November 1, 

2006[.]” 

[¶11.] According to the court, as of November 1, 2006 “Buffalo Ridge had the 

exclusive possession and control of the billboard structures and was free to do with 

them what it pleased subject only to its obligation to pay replacement value for 

certain materials on the billboard structures.” Therefore, Lamar’s continued receipt 

of income on its use of these billboards was, in the court’s words, “a fortuitous 

“And that was contained in my earlier findings and conclusions.” Mr. 

Nooney: “Yes, in the earlier Judgment entered by this [c]ourt.” 
#25604 

-6- 

circumstance for Lamar arising solely from the neglect or failure of Buffalo Ridge” 

to act. 

[¶12.] On the issue of the replacement value, the court found that “[t]he 

parties did attempt to negotiate the replacement value in the period between 

December 2007 and the tender by Buffalo Ridge on May 15, 2008, but failed to 

reach an agreement.” The court ruled that the current replacement value for the 

billboard structures was $37,917.17, due and owing by Buffalo Ridge to Lamar. The 

court awarded Lamar prejudgment interest at the statutory rate of 10% beginning 

after May 15, 2008. It further found that the attempted tender by Buffalo Ridge on 

May 15, 2008 was “conditional.” Finally, it held that “Buffalo Ridge shall recover no 

damages from Lamar.” 

[¶13.] Buffalo Ridge submitted written objections to the court’s findings and 

conclusions. It argued that the court’s ruling that the option was exercised on 

November 1, 2006 was not supported by the evidence and was contrary to the 

parties’ stipulated date at trial, a stipulation the court accepted. Buffalo Ridge 

further asserted that the court failed to set off or give partial satisfaction to Buffalo 

Ridge for Lamar’s uncashed rent checks, paid after the expiration of the leases. It 

then provided to the court its requested damages: $24,750 representing uncashed 

rent checks from the expiration of the leases until May 15, 2008; $14,250 

representing uncashed rent checks from May 15, 2008 to 2009; and $19,500 for 

payments made by Lamar with the uncashed rent checks for billboards not part of 
#25604 

-7- 

 

this lawsuit.4 Lastly, Buffalo Ridge challenged the court’s award of prejudgment 

interest. The court overruled Buffalo Ridge’s objections and refused its request for 

damages. 

[¶14.] On appeal, Buffalo Ridge advances multiple issues, restated as follows: 

the court erred when it (1) held that Buffalo Ridge exercised its option to purchase 

on November 1, 2006; (2) failed to find that Lamar was a willful holdover tenant 

under SDCL 21-3-8; (3) held that Buffalo Ridge’s tender on May 15, 2008 was 

conditional; and (4) failed to award Buffalo Ridge damages or restitution for 

Lamar’s use of the billboards for three years.5

Analysis and Decision 

[¶15.] Buffalo Ridge first argues that the court erred when it held that it 

exercised its option to purchase on November 1, 2006. Not only did the parties 

stipulate that the option was exercised on December 27, 2007, but the court 

accepted the stipulation.6 Moreover, the court, on November 28, 2007, more than 

4. Lamar sent Buffalo Ridge $250 per month on the two billboards not part of 

this suit. Buffalo Ridge did not cash or accept the payments because Lamar 

included the payments within the checks for the expired leases. 

5. Standard of Review: We review a circuit court’s findings of fact for clear error 

and conclusions of law de novo. Hofeldt v. Mehling, 2003 S.D. 25, ¶ 9, 658 

N.W.2d 783, 786 (citations omitted). 

6. Some courts have held that an option to purchase under a lease agreement 

expires upon expiration of the lease. See, e.g., Mr. Sign Studios, Inc. v. 

Miguel, 877 So. 2d 47, 50 (Fla. Ct. App. 2004); Synergy Gas Corp. v. H.M. 

Orsburn & Son, Inc., 689 S.W.2d 594, 596 (Ark. Ct. App. 1985). Therefore, 

Buffalo Ridge’s options to purchase under the leases arguably expired when 

each lease expired: September 1, 2006, November 1, 2006, and February 1, 

2007. The parties, however, do not bring up this issue and we need not 

address it. 
#25604 

-8- 

one year past November 1, 2006, specifically gave Buffalo Ridge thirty days to 

exercise its option. While Lamar concedes the parties stipulated that the option 

was exercised on December 27, 2007, it maintains that the court was entitled to 

change its mind after the October 2009 trial, even though it accepted the 

stipulation. Second, while Lamar acknowledges that on November 28, 2007 the 

court gave Buffalo Ridge thirty days to exercise its option, the court’s ultimate 

judgment for delivery and possession, issued on July 16, 2008, contemplated that 

Buffalo Ridge may have already exercised that right. Thus, Lamar maintains that 

the court’s November 1, 2006 date was not erroneous. 

[¶16.] Why the court declared the option exercised on November 1, 2006 is 

unclear. There is no evidence indicating exactly when Buffalo Ridge gave Lamar 

notice of its intent to exercise its option to purchase. But the parties disposed of 

this question by stipulating that Buffalo Ridge exercised its option on December 27, 

2007. “It is well-established that parties, by stipulation, may bind themselves on all 

matters except those affecting jurisdiction and prerogatives of the court.” Cobbs v. 

Allied Chem. Corp., 661 A.2d 1375, 1377 (Pa. Super. Ct. 1995); see also Gerlach v. 

State, 2008 S.D. 25, ¶ 11, 74 N.W.2d 662, 667 (quoting the above language from 

Cobbs). That the option was exercised on December 27, 2007, rather than 

November 1, 2006 coincides, not only with the parties’ stipulation, but with the 

court’s oral findings and conclusions from November 28, 2007. Because, on 

November 28, 2007, the court gave Buffalo Ridge thirty days to exercise its option, 

there was no way for Buffalo Ridge to exercise it any earlier than November 28, 

2007. Moreover, on November 1, 2006, one lease was still valid and enforceable, not 
#25604 

-9- 

due to expire until February 1, 2007. Therefore, the option for that lease could not, 

as a matter of law, have been exercised on November 1, 2006. Finally, it is 

undisputed that on November 1, 2006, and for a considerable time thereafter, the 

parties were negotiating new lease terms, not the “current replacement value” owed 

by Buffalo Ridge after it exercised its option. Because there is no support for the 

November 1, 2006 date, the court erred when it entered findings reflecting that the 

option was exercised on any other date than December 27, 2007. 

[¶17.] Buffalo Ridge next argues that the court erred when it failed to declare 

Lamar a holdover tenant under SDCL 21-3-8. Buffalo Ridge claims that Lamar’s 

continued occupation of the billboards after the leases expired was willful and 

entitles Buffalo Ridge to double damages. Indeed, Lamar continued to occupy the 

leased billboards under the expired lease agreements. Mere occupation, however, 

does not constitute “willfully holding over real property” under SDCL 21-3-8. A 

claim for willfully holding over requires a “notice to quit . . . duly given, and demand 

of possession made[.]” Id. Here, after the leases expired Buffalo Ridge and Lamar 

negotiated new lease terms in contemplation that new leases would be executed. 

With this period of negotiation, Buffalo Ridge did not give its notice to quit until 

June 20, 2007. Additionally, there is no evidence that Buffalo Ridge made a 

demand for possession. Rather, it exercised its option to purchase the billboard 

materials. SDCL 21-3-8 not being satisfied, the court did not err when it declined to 

find Lamar a holdover tenant under any of the expired leases. 

[¶18.] Buffalo Ridge next argues that the court erred when it held that its 

May 15, 2008 tender to Lamar was conditional. It maintains that the tender of the 
#25604 

-10- 

uncashed rent checks previously issued by Lamar ($35,250.00) and a Buffalo Ridge 

corporate check for $2,667.17 was unconditional, which would stop the running of 

interest on its obligation to Lamar. See SDCL 20-5-18. 

[¶19.] Only when a tender is unconditional will interest toll on an obligation. 

Id. Yet, for tender to be unconditional, it must be “‘the actual production of a sum 

not less than the amount due on a specific debt or obligation.’” Berbos v. Krage, 

2008 S.D. 68, ¶ 22, 754 N.W.2d 432, 438 (quoting Adrian v. McKinnie, 2004 S.D. 84, 

¶ 10, 684 N.W.2d 91, 96). Here, at the time Buffalo Ridge tendered its payment, the 

parties were disputing the current replacement value of the billboard materials, 

which meant that Buffalo Ridge’s tender was conditioned on Lamar accepting 

Buffalo Ridge’s valuation. See Dougherty v. Beckman, 347 N.W.2d 587, 591 (S.D. 

1984) (tender must be for full obligation). Buffalo Ridge’s tender was also 

conditioned on Lamar accepting its own previously issued checks as payment, as the 

tender included over $35,000 in uncashed rent checks issued by Lamar to Buffalo 

Ridge. The court did not err when it ruled Buffalo Ridge’s tender conditional. 

[¶20.] Buffalo Ridge lastly argues that the court erred when it failed to award 

any damages for Lamar’s continued occupation of the billboards after the leases 

expired. In particular, Buffalo Ridge claims it is entitled to contract damages at a 

rate of $750 per month, per lease after expiration, reflecting the lease terms offered 

to Lamar if Lamar continued to lease the billboard sites. Buffalo Ridge 

alternatively requests restitution for unjust enrichment: it conferred a benefit on 

Lamar (use of the billboards); Lamar was aware of the benefit (Lamar knew Buffalo 

Ridge was not cashing the rent checks); and it is inequitable to allow Lamar to 
#25604 

-11- 

retain the benefit of using the billboards without paying Buffalo Ridge. See Hofeldt 

v. Mehling, 2003 S.D. 25, ¶ 16, 658 N.W.2d 783, 788 (citation omitted). At the very 

least, Buffalo Ridge contends that the court should have set off the value of the 

uncashed rent checks issued by Lamar to Buffalo Ridge against Buffalo Ridge’s 

obligation to pay Lamar the current replacement value of the billboards. 

[¶21.] In response, Lamar maintains that simply because it continued to use 

the billboard sites does not mean it owes Buffalo Ridge $750 per month, per lease. 

It avers that Buffalo Ridge prevented Lamar from vacating the leased property, and 

therefore, cannot now claim that it was damaged because Lamar failed to vacate. 

Lamar also claims that Buffalo Ridge is not entitled to restitution because it acted 

with unclean hands: it “created the situation in which it found itself” by not 

allowing Lamar to enter the property and remove the billboard structures. 

[¶22.] The issue of what damages Buffalo Ridge is entitled to, if any, is not 

developed in the record. It is clear that the purpose of the October 2009 trial was to 

address the issue of the current replacement value of the billboards and Buffalo 

Ridge’s damages. However, it was not until the conclusion of the trial that the issue 

of damages was specifically addressed. The court directed the parties to present the 

damages issue by way of proposed findings of fact and conclusions of law. Lamar 

proposed that “Buffalo Ridge shall recover no damages from Lamar.” As support, it 

argued that Lamar’s receipt of advertising income from the billboards for almost 

three years was a “fortuitous circumstance for Lamar arising solely from the neglect 

or failure of Buffalo Ridge to either permit Lamar to enter and remove the billboard 

materials, or to notify such advertisers that Buffalo Ridge now owned and was in 
#25604 

-12- 

control of the billboard structures and any leasing or advertising arrangements 

needed to be made with Buffalo Ridge; or to remove the advertising faces from the 

billboards once Buffalo Ridge had possession and control of the billboards upon 

expiration of the leases.” Buffalo Ridge objected to these findings and conclusions 

and set forth what damages it requested and for what reasons. The court refused 

Buffalo Ridge’s proposed findings and overruled its objections. 

[¶23.] From our review of the record, the court erred when it failed to award 

Buffalo Ridge money damages or restitution for Lamar’s continued occupation of the 

billboard sites after the leases expired. It is undisputed that Lamar continued to 

use and occupy the billboard sites after the leases expired. Indeed, it paid Buffalo 

Ridge $250 per month, per lease, but Buffalo Ridge did not cash the payments 

because of the pending litigation. That the court erred when it failed to award 

damages occurred in part through its erroneous declaration that Buffalo Ridge 

exercised its option to purchase on November 1, 2006. Many of the court’s findings 

incorporate and rely on the November 1, 2006 date. We remand for a proper 

determination of damages or restitution. 

[¶24.] Reversed and remanded. 

[¶25.] GILBERTSON, Chief Justice, and ZINTER, MEIERHENRY, and 

SEVERSON, Justices, concur.