Detailed Answer

This article explains how a South Dakota court handles a private sale when co-owners cannot agree and the court appoints a commissioner to sell a co-owner’s share. It assumes no prior legal knowledge. This is general information only and not legal advice — consult an attorney for guidance about a specific case.

How a partition case gets started

When two or more people own real property together (for example, as tenants in common) and they cannot agree on the use, division, or disposition of the property, any co-owner may file a partition action in South Dakota circuit court. Under South Dakota law, partition and related property matters are governed by the state’s property statutes (SDCL Title 21). See SDCL Title 21: https://sdlegislature.gov/Statutes/Title21.

Who the court can appoint and why

If the court finds that the co-owners cannot agree and that physical division (a partition in kind) is impracticable or unfair, the court may order the property sold and appoint a commissioner to carry out the sale. The commissioner is an officer of the court whose job is to manage the sale process, follow the court’s instructions, and report back to the court about the results.

Private sale vs. public sale

The court can order either a public sale (often by auction) or allow a private sale under terms the court approves. A private sale is common when the property is difficult to market at auction, when buyers prefer negotiated transactions, or when the court believes a private sale will yield a better price. Whether the sale is public or private, the commissioner must follow the court’s directions and any statutory or local rules that apply.

Steps in a court-appointed private sale

1. Order and appointment: The court issues an order authorizing the sale and naming the commissioner. The order will set basic terms or authorize the commissioner to develop terms subject to court approval.
2. Notice to parties and interested persons: The commissioner must notify all co-owners and other parties with recorded interests (mortgages, liens, etc.) about the proposed sale and the sale terms. The court’s order or local procedural rules dictate the required notice and timing.
3. Valuation and marketing: The commissioner usually obtains an appraisal or valuation and markets the property. For private sales, the commissioner solicits offers from prospective buyers, negotiates sale terms, and evaluates offers. The commissioner should act to obtain a fair market price and to protect co-owners’ interests.
4. Filing the proposed sale with the court: Once the commissioner negotiates a sale, the commissioner files a report or petition asking the court to approve the sale. The filing includes the sale contract, the proposed purchase price, any appraisal or comparable evidence, and an accounting of anticipated sale costs and liens to be paid from sale proceeds.
5. Opportunity to object: Co-owners and interested parties receive notice of the proposed sale and the court date for confirmation. Any party may object — for example, by arguing the sale is for too low a price, the commissioner did not properly market the property, or the sale terms are not commercially reasonable. The court will schedule a hearing to consider objections.
6. Hearing and court review: At the confirmation hearing, the court examines the sale terms, evidence of value, steps taken by the commissioner to obtain fair value, and any objections. The court has discretion to approve, reject, or modify the sale. The court will approve the private sale only if it finds the sale is fair, commercially reasonable, and in the co-owners’ best interests.
7. Closing and conveyance: If the court confirms the sale, the closing proceeds and the title convey according to the sale contract and court order. The commissioner provides a final accounting to the court showing sale price, liens paid, costs of sale (including commissioner and attorney fees), and the net proceeds for distribution among co-owners according to their ownership shares.
8. Distribution and recording: The court signs orders directing disbursement of funds and the commissioner or clerk records the deed or other documents to complete transfer of title to the buyer. The buyer receives marketable title free of the co-owners’ rights as provided in the court’s order.

Common issues and rights of an objecting co-owner

• Right to notice and hearing: You must receive proper notice and have an opportunity to appear and object in court.
• Challenging sale price or process: You can challenge the fairness of the sale by presenting evidence (appraisals, recent comparable sales, proof that the commissioner failed to market, or procedural defects).
• Purchasing the property yourself: Co-owners may try to negotiate a buyout before the court confirms any sale. If you want to purchase, disclose any conflicts and follow the court’s rules — the court will be vigilant to ensure a co-owner’s purchase is at fair market value and not a self-dealing transaction.
• Costs and liens: Costs of the sale (commissioner’s fees, advertising, closing costs, attorney fees if allowed by the court) and liens (mortgages, tax liens) are typically paid from sale proceeds before distribution to co-owners.

Timing and costs

Partition cases and sale confirmation may take several months or longer, depending on complexity, objections, and court schedules. Expect costs for the commissioner, appraisals, title searches, and attorney fees. The court decides how and whether to allocate attorney fees and commissioner fees among the parties.

Where to read the law and local rules

South Dakota’s property statutes are collected in SDCL Title 21 (Property). Many procedural details, local rules, and forms are handled by the circuit court or the Unified Judicial System. Useful links:

• South Dakota Codified Laws — Title 21 (Property): https://sdlegislature.gov/Statutes/Title21
• South Dakota Unified Judicial System (court information and local rules): https://ujs.sd.gov

Helpful Hints

• Get an attorney early. Partition actions and commission sales involve deadlines, evidence rules, and strategic decisions. An attorney can protect your rights and help evaluate offers.
• Obtain an independent appraisal or market analysis to support your position about fair value.
• Preserve proof of any contributions you made to the property (improvements, payments of taxes or mortgage) — the court can consider those when allocating proceeds.
• Consider negotiating a buyout or settlement with co-owners before the court orders a sale; settlements often save time and costs.
• Attend the confirmation hearing. Your objections carry more weight when you appear and present evidence in person or through counsel.
• Keep records of communications and marketing efforts if you are the one attempting to sell — the commissioner’s steps will be reviewed by the court.
• Expect sale costs to reduce your net proceeds. Ask the court for a detailed accounting before distribution.

Remember: this article is educational only and does not constitute legal advice. For advice about a specific situation, contact a South Dakota attorney who handles partition and real property litigation.