Penalties imposed by contract for any nonperformance thereof are void. This section does not void obligations penal in form such as heretofore have been commonly used, but it voids their penal clauses.
S.D. Codified Laws § 53-9-4
Penalties for nonperformance of contract void, exceptions
Applied in 6 court decisions — leading case BankWest, N.A. v. Groseclose (1995)
Most recently applied in Bon Homme County Commission v. American Federation of State, County, & Municipal Employees (AFSCME), Local 1743A (June 2005)
Source: CivC 1877, § 955; CL 1887, § 3579; RCivC 1903, § 1273; RC 1919, § 894; SDC 1939, § 10.0703.
How often courts cite this section
Court decisions citing this, by year. The dip in the last several years is a data-coverage gap, not a real trend — our corpus holds fewer opinions from the most recent years, so recent citations are undercounted.
Official source: South Dakota Legislature. Reproduced from public-domain South Dakota statutes; confirm against the official source for the current text. Not legal advice.