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2016 S.D. 64

IN THE SUPREME COURT

OF THE

STATE OF SOUTH DAKOTA

* * * *

In the Matter of the MAURICE M. RICARD FAMILY TRUST

* * * *

APPEAL FROM THE CIRCUIT COURT OF

THE FOURTH JUDICIAL CIRCUIT

MEADE COUNTY, SOUTH DAKOTA

* * * *

THE HONORABLE JEROME A. ECKRICH, III

Judge

* * * *

JEFFREY R. CONNOLLY of

Gunderson, Palmer, 

 Nelson & Ashmore, LLP

Rapid City, South Dakota

and

JASON L. REED of

Adam Jones Law Firm, PA

Wichita, Kansas Attorneys for appellants Renee 

Laas, Racette Cuzzort, 

Individually & as Trustee of the 

Mary Bettwy Trust & Anna 

Marsden. 

MICHAEL W. STRAIN of

Strain Morman Law Firm

Sturgis, South Dakota Attorneys for appellee 

Kelly Ricard.

* * * *

CONSIDERED ON BRIEFS 

ON AUGUST 29, 2016

OPINION FILED 09/28/16
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WILBUR, Justice

[¶1.] Many years after the sisters sold their respective interests in the 

family trust to one brother, the sisters sought to rescind their agreements and 

repurchase their respective interests. The sisters alleged that their brother 

obtained their consent to sell through fraud and undue influence. After a two-day 

court trial, the circuit court denied the sisters’ request. The sisters appeal. We 

affirm. 

Background

[¶2.] Maurice Ricard and his wife, Ella “Bernadette” Ricard, had six 

children: Kelly Ricard, Renee Anderson (now Renee Laas), Anna Henrickson (now 

Anna Marsden), Racette Cuzzort, Medric Ricard, and Mary Bettwy. Maurice and 

Bernadette each owned an undivided, one-half interest in the real property 

comprising the Ricard family ranch. They wanted the ranch to stay intact, remain 

in the family, and operate as a ranch. Since 1998, their son Kelly leased the real 

estate to graze cattle. 

[¶3.] Maurice passed away on August 11, 2002. Bernadette, as personal 

representative, admitted Maurice’s Last Will and Testament to probate. The Will 

created The Maurice M. Ricard Family Trust (Family Trust or Trust). The Family 

Trust appointed Renee as trustee. The Family Trust provided that the real 

property owned by Maurice would be held by the Trust for the use and benefit of 

Bernadette during her lifetime. Bernadette, as personal representative, conveyed 

Maurice’s undivided, one-half interest in the real property to the Family Trust. The 

Trust further provided that, upon the death of Bernadette, the Trust would 
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terminate and Kelly would receive 50% of the assets, Renee, Anna, and Racette 

would each receive 12.5%, and the remaining 12.5% would be placed in a trust for 

the benefit of Mary. 

[¶4.] In 2003, Bernadette formed the Ricard Ranch Family Limited 

Partnership for estate planning purposes on the advice of attorney Kurt Solay. 

Attorney Solay had been giving Maurice and Bernadette estate planning advice 

since 1998, and continued to give Bernadette advice after Maurice’s death. In 

regard to the Limited Partnership, Bernadette and Kelly were the general partners. 

Later, Bernadette assigned her general partnership interest to Kelly. The Family 

Trust was a limited partner. On November 20, 2003, Renee, as trustee of the 

Family Trust, conveyed the undivided, one-half interest in the real property owned 

by the Family Trust to the Limited Partnership. Bernadette similarly transferred 

her undivided, one-half ownership in the real property to the Limited Partnership. 

[¶5.] In November 2003, Kelly offered to purchase the sisters’ respective 

12.5% interests in the Family Trust for $20,000 each. The offer included an option 

to purchase, providing that each sister could purchase back their interest under 

certain circumstances. The sisters accepted Kelly’s offer, signed the agreements to 

sell (Agreements), and negotiated the $20,000 checks mailed to them by Attorney 

Solay. After the purchase, the sisters no longer held an interest in the Family 

Trust. According to Renee, the sisters believed they would inherit from 

Bernadette’s estate when Bernadette passed. 

[¶6.] In October 2008, the Limited Partnership transferred approximately 

80 acres of real estate to Bernadette for estate planning purposes. According to 
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Kelly, the 80 acres comprised Bernadette’s personal residence. The Family Trust 

owned an undivided, one-half interest in the 80 acres. 

[¶7.] In August 2010, Bernadette passed away. Upon its terms, the Family 

Trust terminated. Renee, as trustee, took no action to distribute the Trust assets 

following Bernadette’s death. Under the Trust, the assets would have been 

distributed to Kelly because he owned a 50% interest and purchased each sister’s 

12.5% interest. Kelly filed a petition for distribution in January 2013. The sisters 

objected and filed a petition for determination of beneficiary status. The sisters 

challenged the enforcement of the Agreements signed by them selling their 

respective 12.5% interests in the Family Trust to Kelly. They sought to rescind the 

Agreements due to fraud and undue influence by Kelly. Renee claimed that 

although she negotiated the $20,000 check, she sent the funds back to Kelly and 

Bernadette. According to Renee, she believed she had no other option but to sign 

the Agreement. She believed the payment was part of Maurice’s estate. She 

testified that she was not aware that she was transferring her interest for far less 

than it was worth. 

[¶8.] After a two-day trial, the court denied the sisters’ petition. The court 

concluded that there was no evidence that any sister was forced to sign the 

Agreement or that Kelly affirmatively or by omission misrepresented any fact or 

committed any fraud. 

[¶9.] The sisters appeal, asserting:

1. Whether the Agreements are enforceable.
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2. Whether, assuming that the Agreements are valid and 

enforceable, the appellants should be allowed to rescind 

their Agreements.

3. Whether, assuming that Agreements are valid and 

enforceable, Kelly Ricard breached the Agreements.

Standard of Review

[¶10.] We review the circuit court’s factual findings for clear error. Geraets v. 

Halter, 1999 S.D. 11, ¶ 12, 588 N.W.2d 231, 233. Whether undue influence exists 

and whether fraud was perpetrated are questions of fact. In re Donald Hyde Tr., 

2014 S.D. 99, ¶ 37, 858 N.W.2d 333, 344; Poeppel v. Lester, 2013 S.D. 17, ¶ 20, 827 

N.W.2d 580, 585. We give no deference to the court’s conclusions of law. Geraets, 

1999 S.D. 11, ¶ 12, 588 N.W.2d at 234.

Analysis 

1. Are the Agreements Enforceable?

[¶11.] The sisters contend that the Agreements, “while on their surface 

appear to be valid and enforceable, are actually the product of undue influence, 

fraud and the result of a person with more power and access to information taking 

advantage of his confidential situation.” In the sisters’ view, the evidence presented 

clearly established that there was no meeting of the minds on all essential elements 

or terms of the Agreements, and the circuit court failed to consider this evidence. 

The sisters particularly emphasize that Kelly stood in a confidential relationship 

with them because he had superior knowledge of land values, knowledge of the 

cattle operation, and was a general partner of the limited partnership. 

[¶12.] In response, Kelly claims that the sisters consented to the terms of the 

Agreements “by participating in at least one meeting to discuss the content and 
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reason for the agreement, by signing the agreement, by accepting and cashing a 

check for $20,000.00.” He also argues that consideration was sufficient because, in 

addition to the $20,000 payment, the sisters were able to fulfill their parents’ desire 

that the Ricard family ranch remain in the family, that it operate as a ranch, and 

that the sisters would have the option to repurchase if Kelly were to attempt to sell 

the real property for non-agricultural purposes. In regard to their claim that Kelly 

exerted undue influence or perpetrated fraud, Kelly claims that he “had no 

affirmative obligation to the Sisters to provide them valuation information, and the 

record is absolutely clear of any actions or omissions by Kelly constituting fraud or 

undue influence.” 

[¶13.] Under SDCL 53-1-2, the “[e]lements essential to existence of a contract 

are: (1) Parties capable of contracting; (2) Their consent; (3) A lawful object; and (4) 

Sufficient cause or consideration.” It is a general rule that “one who accepts a 

written contract is conclusively presumed to know its contents and to assent to 

them, in the absence of fraud, misrepresentation or other wrongful act by another 

contracting party.” Lucero v. Van Wie, 1999 S.D. 109, ¶ 16, 598 N.W.2d 893, 898 

(quoting LPN Tr. v. Farrar Outdoor Advert., Inc., 1996 S.D. 97, ¶ 13, 552 N.W.2d 

796, 799). 

[¶14.] Here, the court found that no sister presented “evidence that any sister 

was forced to sign the agreement.” In the court’s view, the sisters “misapprehended 

an expectancy from mother’s estate,” but “[t]his misapprehension fails to negate the 

sisters’ consent to the agreement.” Also, according to the court, the sisters 

presented “no evidence that Kelly affirmatively or by omission misrepresented any 
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fact or committed a fraud.” The court recognized that the sisters contested the

validity of the Agreements only after Bernadette’s death because they learned that 

they did not inherit their mother’s portion of the Ricard family ranch. 

[¶15.] We afford great deference to the circuit court’s ability to judge the 

credibility of the witnesses and the weight to be given to their testimony. See

Jeschke v. Wockenfuss, 534 N.W.2d 602, 604 (S.D. 1995). Our review of the evidence 

supports the court’s determination that Kelly did not obtain the sisters’ consent 

through fraud or undue influence. The sisters received an inventory of Maurice’s 

estate dated December 19, 2003, which indicated the value of Maurice’s undivided, 

one-half interest in the ranch property at $952,500. Renee testified that she was 

aware of how land is valued in agriculture because she is in the agriculture 

business. Then, on December 31, 2003, the sisters signed the Agreements selling 

their respective interests to Kelly. Each sister also accepted and negotiated the 

$20,000 payment for the sale. “A party’s intentional conduct which constitutes a 

manifestation of assent will bind a party even though the party’s conduct does not 

truly express his or her state of mind.” Amdahl v. Lowe, 471 N.W.2d 770, 774 (S.D. 

1991). And it “would absolutely destroy the value of all contracts” if we allow the 

sisters to deny the agreement each made because they did not read them. LPN, 

1996 S.D. 97, ¶ 13, 552 N.W.2d at 799 (citation omitted).

[¶16.] There is no evidence to support the sisters’ claim that Kelly, a general 

partner of the Limited Partnership, was in a confidential relationship with the 

sisters as beneficiaries of the Family Trust or that Kelly unduly influenced the 

Family Trust and its beneficiaries when he applied a discount to the calculation of 
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the minority interests. The sisters were not limited partners of the Limited 

Partnership. And Kelly did not purchase Limited Partnership interests. Kelly 

purchased the sisters’ respective remainder interests in the Family Trust. 

2. Should the Contracts be Rescinded?

[¶17.] The sisters argue that they did not freely and voluntarily give their 

consent to sign the Agreements. They aver that they signed the Agreements 

because they believed they had no other option. According to Renee, they signed the 

Agreements to protect their mother. Renee, as trustee of the Family Trust, further 

asserts that “[s]he was not provided independent advice that the Family Trust 

owned an interest in the real estate that was separate and apart from the interest 

of her mother.” The sisters claim the Agreements should be rescinded because 

Kelly “gained an advantage to the detriment of the Sisters and the Family Trust by 

not providing the documentation and carrying forth his fiduciary duties to inform 

the limited partners of what limitations would be placed on their ownership 

interest.” 

[¶18.] Kelly, in response, asserts that the sisters are barred from rescinding 

the Agreements because the statute of limitations expired on their claim. He 

alternatively argues that the sisters have failed to cite to specific testimony or 

evidence to support that he perpetrated fraud, duress, or undue influence. He 

emphasizes that the sisters seek rescission for a mistake that arose due to the 

sisters’ failure to be prudent. Kelly contends that “[t]he Sisters simply regret their 

decision or wish for a do-over because they assumed each would receive more 

directly from Bernadette through her Last Will and Testament.” 
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[¶19.] Statute of limitations is an affirmative defense, which must be pleaded 

or it is waived. SDCL 15-6-8(c); High Plains Genetics Research, Inc. v. J K Mill-Iron 

Ranch, 535 N.W.2d 839, 845 (S.D. 1995) (failure to plead an affirmative defense 

“results in a bar to the defense”). From our review of the record, Kelly did not raise 

statute of limitations as an affirmative defense. This waives the issue. 

[¶20.] Nonetheless, the circuit court did not err when it refused to rescind the 

Agreements. “One cannot, without an option to do so or consent of the other party, 

be relieved of a contract merely because he may have made a bad bargain.” Olson v.

Opp, 85 S.D. 325, 328-29, 182 N.W.2d 220, 222 (1970). And the reason for rescission 

“must not have arisen from want of such care as would be exercised by a person of 

reasonable prudence where the means of knowledge were readily accessible.” Id. at 

329, 182 N.W.2d at 222. 

[¶21.] The evidence establishes that the sisters received an inventory after 

their father’s death indicating the value of his interest in the real property. The 

sisters knew that Bernadette wanted the real property to remain in the Ricard 

family and operate as a ranch. The sisters acknowledged that Kelly ranched the 

Ricard property and intended to continue to do so. The sisters voluntarily accepted 

the $20,000 payment under the terms of the Agreement. 

3. Did Kelly Breach the Agreements?

[¶22.] The sisters argue that Kelly materially breached the Agreements when 

Kelly, as the general partner of the Limited Partnership, transferred real estate out 

of the Limited Partnership without notice to the limited partner—the Family Trust. 

According to the sisters, the language of the Agreements contemplates “that all of 
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the real estate that was the subject of the Agreement would remain intact at least 

until the death of Bernadette Ricard.” Because Kelly transferred real estate out of 

the Limited Partnership, the sisters claim they did not receive the benefit of their 

bargain and should “now have the opportunity to repurchase their 12.5% interest 

back from Kelly Ricard for the original price of $20,000 each.” The sisters 

acknowledge they did not plead a claim for breach of contract. They assert that the 

issue was tried by implied consent, and Kelly had a full and fair opportunity to 

litigate the issue. See SDCL 15-6-15(b). 

[¶23.] Kelly responds that he did not consent to amend the pleadings to add a 

claim for breach of contract. He also asserts that he did not consent to allow a 

breach of contract claim simply because he allowed testimony concerning the 2008 

transfer of real property from the Limited Partnership. Alternatively, Kelly argues 

that he did not breach the Agreements because nothing in the Agreements 

prohibited the Limited Partnership from transferring property directly to 

Bernadette during Bernadette’s lifetime, and the transfer did not implicate the 

sisters’ option to purchase because the property continued to be used for 

agricultural purposes. 

[¶24.] In Dussart v. Dussart, we explained that a motion to amend the 

pleadings must be made to the circuit court before this Court will consider whether 

the issue was tried by implied consent under SDCL 15-6-15(b). 1996 S.D. 41, ¶ 6, 

546 N.W.2d 109, 111. This is because the “complaining party must give the trial 

court an opportunity to consider claimed irregularities and rule on them.” Id. The 

sisters contend that “the request was made in the post trial brief that was presented 
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by Appellants requesting that the breach of contract be determined.” But we cannot 

find the request in the record. Regardless, there is no written motion in the record 

or oral motion in the transcripts to support that the sisters moved the circuit court 

to amend their pleadings. We decline to consider the sisters’ argument that SDCL 

15-6-15(b) permits their claim that Kelly breached the Agreements. 

[¶25.] Affirmed.

[¶26.] GILBERTSON, Chief Justice, and ZINTER, SEVERSON, and KERN, 

Justices, concur.