Wyman v. Bruckner, 2018 SD 17.  This case involved a dispute between sisters related to the handling of the financial affairs of their now-deceased Mother.  Plaintiff, as personal representative of the estate, brought this action against Defendant, her sister, premised upon alleged “self-dealing in her capacity as [Mother’s] attorney-in-fact,” and alleging that Defendant improperly wrote checks from an account owned jointly by Defendant and Mother for the benefit of herself and her family.  These amounts included a $200,000.00 check to Defendant’s husband and two checks of $6,377.16 to herself.

Plaintiff brought several claims against the Defendant in a separate civil action “on several grounds,” but eventually narrowed her action solely to a claim of “breach of fiduciary duty.”  Defendant responded that her status as a joint owner entitled her to withdraw funds from the account.  Furthermore, Defendant argued that a power of attorney, which named Defendant as attorney-in-fact, permitted self-dealing and authorized her to transfer funds out of the joint account to herself and to her family members.

The trial court granted summary judgment for Defendant and ruled that the power of attorney permitted Defendant to self-deal and to gift Mother’s money to herself as well as to her immediate family. However, the Supreme Court of South Dakota reversed and remanded the case.  The Court held that there was no “clear and unmistakable language” in the power of attorney that authorized self-dealing acts and, moreover, that the power of attorney did not clearly authorize transfers to Defendant’s family members as well.  The Court also found that Defendant had breached her fiduciary duties, stemming from her role as attorney-in-fact, to her Mother when she spent funds from the joint account on herself and her family while Mother was still alive.  To this extent, the trial court was reversed.

However, the Court remanded to the trial court to determine whether Defendant acted in her fiduciary capacity when she was added to the joint account.  Since Defendant’s durable power of attorney expired after Mother’s death, along with Defendant’s fiduciary duties stemming from that role, the Court held that a determination was necessary as to whether Defendant’s role as being listed on the joint-account established fiduciary duties that would extend after Mother passed away.

State v. Lar, 2018 SD 18.  This case involved a Defendant that was a passenger in a vehicle that was pulled over for an “inoperable headlight.”  Due to the driver’s nervous appearance, law enforcement deployed a drug dog that indicated a controlled substance was present in the vehicle.  Law enforcement searched the vehicle and found a metal pipe and marijuana.  No controlled substances were found on Defendant, however, Defendant, the driver, and the two other passengers were arrested for possession of marijuana and drug paraphernalia.  After being arrested, law enforcement required Defendant to provide a urine sample without his consent and without a warrant.  The results of the urine test detected metabolites of meth, to which Defendant was charged with unauthorized ingestion of a controlled substance.  Defendant filed a motion to suppress the results of the urine test, but said motion was denied.

On appeal, the Supreme Court of South Dakota held that the “privacy concerns surrounding the category of effects at issue in this case (i.e., an arrestee’s urine) outweigh the State’s interest in preserving evidence.”  Given the significant invasion of privacy of collecting urine samples, the Supreme Court of South Dakota held that law enforcement may not require an arrestee to urinate into a specimen container as a search incident to arrest, but instead must secure a warrant prior to obtaining a urine sample from an arrestee.  Thus, the search at issue violated the Fourth Amendment and the trial court erred by denying Defendant’s motion to suppress.

Stern Oil, Inc. v. Brown, 2018 SD 15. This is the second time this case has been appealed to the Supreme Court.  In the first trial, Stern Oil was awarded over $900,000.00 in lost profits related to the breach of fuel supply contracts.  However, that verdict was appealed, reversed, and remanded relating to the trial court’s errors in granting summary judgment as to Stern Oil’s breach of contract claims against Brown and the trial court’s denial of Brown’s fraud claims against Stern Oil.  Another jury trial was held, which found in favor of Stern Oil in the amount of $260,464.00 plus $143,708.00 in prejudgment interest.  After the verdict, Stern Oil submitted a request for attorneys’ fees as there was a provision in the contract between Stern Oil and Brown that the prevailing party would be awarded attorney’s fees.  The trial court held that Stern Oil was not the prevailing party and its request for attorneys’ fees was denied.  This decision, along with certain issues at trial, were appealed to the Supreme Court of South Dakota

Ultimately, the Supreme Court of South Dakota reversed and remanded for a new trial on Stern Oil’s damages for lost profits.  The trial court had erred when it instructed the jury on consequential damages and the foreseeability of Stern Oil’s lost profits to Brown at the time of contracting.  The trial court also erred by excluding Stern Oil’s evidence on certain damage scenarios.  However, the Supreme Court of South Dakota did uphold the jury’s decision awarding BIP contract damages (reimbursements under the Motor Fuel Supply Agreements) to Stern Oil in the amount of $22,659.00 and denying Stern Oil’s lost profits claim for diesel fuel. As it relates to the request for attorneys’ fees, the Supreme Court of South Dakota reversed Judge Long’s decision that Stern Oil was not the prevailing party, finding that Stern Oil was the party “whose favor the decision or verdict is or should be rendered and judgment entered” based on the jury verdict of $260,464.00 and the jury’s findings in favor of Stern Oil’s breach of contract claim.  Therefore, Stern Oil was entitled to attorneys’ fees.

Matter of M.M.W. & Wilkie, 2018 SD 16. This case involved a “son” who was charged with domestic assault of “granddaughter” in Minnesota.  In pursuit of prosecution in Minnesota, the Minnesota authorities sought to compel the attendance of “grandfather” and “granddaughter” (the alleged victim), both who resided in South Dakota.  The Minnesota trial court made appropriate findings and certified the matter which was then handled by the Moody County State’s Attorney, who filed a motion requesting the South Dakota Circuit Court enter an order summoning granddaughter and grandfather to appear and testify in the Minnesota criminal proceeding.   The South Dakota Circuit Court ruled for the state, ordering both grandfather and granddaughter to appear in Minnesota.  The Supreme Court of South Dakota affirmed as to the grandfather but reversed and remanded as to the granddaughter, holding that the failure of the circuit court to make adequate findings in considering the hardship issue raised by the granddaughter was an abuse of discretion.  The Supreme Court of South Dakota directed the trial court to allow granddaughter to testify so that the record could be further developed, and adequate findings of facts made as it regarded granddaughter’s claim of hardship.

Laska v. Barr, 2016 SD 6.  This is the second appeal regarding the interpretation of an agreement titled as a “right of first refusal.”  Through the years, the Laskas executed multiple agreements with Jerry Bar, Pat Cole, and Gerrit Juffer involving real estate in Charles Mix County.  This case involved an agreement entered into on February 3, 2005.  Although the agreement was titled as a “Right of First Refusal,” it also contained a fixed price option.  It also provided a provision that allowed the Barr Partners an opportunity to purchase the property if the Laskas received a bona fide third party offer to purchase all or a portion of the property at issue.  When the Laskas asked the Barr Partners to release their interest in the property, the Barr Partners refused, and a lawsuit was brought.  After a court trial, the trial court found that the language of the agreement unambiguously granted the Barr Partners a right of first refusal that terminated upon the deaths of the Laskas.  The Barr Partners appealed, and, on the first appeal, the Court concluded that the agreement was ambiguous as to whether it created a right of first refusal, an option, or a dual option and directed the court on remand to consider the parol evidence previously received during the court trial.  The Court also directed the trial court to consider whether the 2005 agreement constituted an unreasonable restraint on alienation.  After considering the parol evidence, and after briefing on the question whether the 2005 agreement was an unreasonable restraint on alienation, the trial court concluded that the agreement was a right of first refusal, but that it was void as an unreasonable restraint on alienation.  On the second appeal, the Court, per Retired Justice Wilbur, affirmed.

Continue Reading January 25, 2018, Case Summaries

McDowell v. Sapienza, 2018 S.D. 1.  Property owners constructed a new home on property located within a historic district.  The adjacent owners alleged that the new home violated state regulations on new construction in historic districts as well as a local ordinance governing chimneys.  The adjacent owners sought a mandatory injunction requiring modification or reconstruction of the new home.  The adjacent owners also sued the City of Sioux Falls, alleging negligence in issuing a building permit and failing to enforce the regulations.  The circuit court granted the injunction, and it concluded that the City owed the adjacent owners a duty to properly enforce building codes.  On appeal, the Court, per Justice Zinter, affirmed the issuance of an injunction, concluding that the new construction standards found in ARSD 24:52:07:04 apply to the new home, and that the circuit court therefore did not abuse its discretion in granting an injunction with respect to historic-district regulations.  The circuit court did, however, err in concluding that the new home violated the chimney ordinance, and that the City owed a duty to the adjacent property owners, and, as to that issue, the Court therefore reversed and remanded for further proceedings.

Continue Reading January 4, 2018, Case Summaries

Schott v. S.D. Wheat Growers, 2017 S.D. 91.  Schott, the owner of Corson County Feeders, Inc., sued the South Dakota Wheat Growers Association, alleging that its agronomist incorrectly prescribed a herbicide that Schott sprayed on his 2014 sunflower crop.  The herbicide was not labeled for use on all of Schott’s sunflowers, and 1,200 acres were destroyed.  The circuit court granted the Wheat Growers summary judgment, ruling that Schott assumed the risk.  On appeal, the Court, per Justice Zinter, reversed and remanded, concluding that genuine issues of material fact existed concerning Schott’s knowledge and appreciation of the risk.

Continue Reading December 28, 2017, Case Summaries

Berggren v. Schonebaum, 2017 S.D. 89.  This case involves a motion to disqualify opposing counsel for a violation of the Rules of Professional Conduct.  Meendering alleged that he had met with the opposing counsel and discussed the money he loaned Schonebaum, and that, during the meeting, Fischer failed to disclose that he represented Berggren in a lawsuit against Schonebaum.  After the meeting, the opposing counsel sent Meendering a letter, explaining that he was currently involved in a lawsuit against Schonebaum and requested that Meendering contact him by phone to speak about Schonebaum.  Schonebaum and Meendering claim Meendering and Fischer later spoke over the phone.  Two months later, Berggren amended his complaint against Schonebaum to include Meendering as a defendant.  Meendering filed a motion to disqualify opposing counsel for an alleged violation of the South Dakota Rules of Professional Conduct.  Meendering also sought attorneys’ fees from opposing counsel for costs incurred in bringing the motion.  The circuit court, citing Jacobson v. Leisinger, 2008 S.D. 19, 746 N.W.2d 739 (Leisinger II), granted the motion.  In imposing fees, the court reasoned that the sanctions were appropriate because the motion to disqualify was “other litigation” resulting from opposing counsel’s alleged ethical violation.  On appeal, the Court, per Justice Kern, reversed, holding that opposing counsel’s alleged violation of the Rules of Professional Conduct did not result in “other litigation” comprehended by Leisinger II or the precedent on which it relies, and his conduct did not necessitate further litigation to protect a property right. It was a component of the same, not other, litigation. Further, the procedural requirements for Rule 11 sanctions were not met, and the Court therefore declined to address whether a sanction was proper under Rule 11.

Continue Reading December 21, 2017, Case Summaries

Streff v. State Farm Mut’l Auto. Ins. Co., 2017 SD 83.  SDCL 58-11-9.4 requires underinsured motorist (UIM) coverage in “motor vehicle liability polic[ies]” of insurance.  The Streffs purchased a motor vehicle liability policy from one insurer and also purchased a personal liability umbrella policy from a separate but related insurer.  Both policies provided UIM coverage, but both excluded coverage for accidents caused by government vehicles.  When Jody was injured in an accident involving a government vehicle, a dispute arose concerning the enforceability of the exclusions.  The circuit court ruled that the exclusion was not enforceable in the motor vehicle liability policy but was enforceable in the umbrella policy.  The Streffs appealed, and the Court, per Justice Severson (on reassignment), reversed, holding that the South Dakota UIM statute is not limited to primary insurance policies, and that the statute contemplates additional coverage.  Thus, by extension, umbrella policies that include UIM coverage are subject to the same public policy prohibitions on the exception of government vehicles from UIM coverage.  Justices Zinter and Kern dissented.

Continue Reading December 14, 2017, Case Summaries

The Court has released the list of its November 2017 summary dispositions:

Case Number Date Disposition Judge
Siems v. Pilot Travel Centers, LLC 28254 11-13-17 Affirmed Long
State v. Hanson 28178 11-13-17 Affirmed Sabers
Wright v. Theophilus 28108 11-13-17 Affirmed Pekas
State v. Bortock 28131 11-13-17 Affirmed Long
Schwartz, on behalf of M.N. v. Neuenschwander 28081 11-13-17 Affirmed Linngren
Schwartz, on behalf of M.N. v. Neuenschwander 28082 11-13-17 Affirmed Linngren
State v. Shepard 28142 11-13-17 Affirmed Davis
State v. Fitzgerald 28170 11-13-17 Affirmed Eckrich
State v. Hamling 28171 11-13-17 Affirmed Eckrich
State v. Weber 28184 11-13-17 Affirmed Myren
Ollila, et al. v. Ginsbach, et al. 28206 11-13-17 Affirmed Percy
State v. Eberhardt 28225 11-13-17 Affirmed Means
State v. Popkes 28244 11-13-17 Affirmed Zell
Curran v. Curran 28182 11-13-17 Affirmed Pfeifle
Horn n/k/a Haub v. Horn 28233 11-30-17 Affirmed Day

Oyen v. Lawrence Cnty. Comm’n, 2017 SD 81.  Various landowners petitioned the Lawrence County Commission requesting that the County maintain a road providing access to their homes.  The County denied the landowners’ request.  Oyen appealed the County’s action to circuit court.  The County filed a motion to join the United States of America as an indispensable party.  The court denied the motion, finding the County responsible for the road and directing the County to provide maintenance.  The County appealed, and the Court, per Justice Severson, reversed and remanded for the circuit court to join, if feasible, the United States of America as an indispensable party.  If joinder is not possible, then the circuit court is to determine whether to dismiss the case.

State v. Humpal, 2017 SD 82.  The sentencing court imposed a five-year penitentiary term upon the defendant while he was serving a probationary sentence in a different criminal file.  The defendant appealed, arguing that the court imposed an illegal sentence when it placed him under the dual supervision of the judicial and executive branches.  On appeal, the Court, per Retired Justice Wilbur held that, although the sentencing court erred when it placed defendant under simultaneous supervision of two branches of government, defendant is currently only under the supervision of the executive branch.  His sentence was therefore affirmed.

State v. Draskovich, 2017 SD 76.  Draskovich was convicted of threatening a judicial officer and disorderly conduct as a result of statements he made in the Minnehaha County Courthouse.  The circuit court ruled that the statements were “true threats,” rather than First Amendment-protected speech.  He had told the clerk of courts that he could “see why people shoot up courthouses,” and, when discussing a judge’s refusal to grant him a work permit, he commented to Court Administration, “Well, that deserves 180 pounds of lead between the eyes.”  On appeal, the Court, per Justice Zinter, affirmed, concluding that a reasonable recipient would view his statements as “a serious expression of an intent to commit an act of unlawful violence” against court staff and the circuit court judge.

Continue Reading November 22, 2017, Case Summaries