Title 53 — CONTRACTS

A contract is an agreement to do or not to do a certain thing. Source: CivC 1877, § 870; CL 1887, § 3494; RCivC 1903, § 1188; RC 1919, § 803; SDC 1939, § 10.0101.

Elements 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. Source: CivC 1877, § 871; CL 1887, § 3495; RCivC 1903, § 1189; RC 1919, § 804; SDC 1939, § 10.0102.

A contract is either express or implied. An express contract is one, the terms of which are stated in words. An implied contract is one, the existence and terms of which are manifested by conduct. Source: CivC 1877, §§ 915 to 917; CL 1887, §§ 3539 to 3541; RCivC 1903, §§ 1233 to …

A contract is to be interpreted according to the law and usage of the place where it is to be performed or, if it does not indicate a place of performance, according to the law and usage of the place where it is made. Source: CivC 1877, § 937; CL 1887, § 3561; RCivC 1903, § 1255;…

All persons are capable of contracting except minors, persons of unsound mind, and persons deprived of civil rights. Source: CivC 1877, § 872; CL 1887, § 3496; RCivC 1903, § 1190; RC 1919, § 805; SDC 1939, § 10.0201.

Minors and persons of unsound mind have only such capacity as is specified in the statutes relating to such persons. Source: CivC 1877, § 873; CL 1887, § 3497; RCivC 1903, § 1191; RC 1919, § 806; SDC 1939, § 10.0202.

If the parties cannot be identified, a contract is invalid. Source: CivC 1877, § 874; CL 1887, § 3498; RCivC 1903, § 1192; RC 1919, § 807; SDC 1939, § 10.0203.

Where all the parties who unite in a promise receive some benefit from the consideration, whether past or present, their promise is presumed to be joint and several. Source: CivC 1877, § 950; CL 1887, § 3574; RCivC 1903, § 1268; RC 1919, § 889; SDC 1939, § 10.0104.

A promise made in the singular number but executed by several persons is presumed to be joint and several. Source: CivC 1877, § 951; CL 1887, § 3575; RCivC 1903, § 1269; RC 1919, § 890; SDC 1939, § 10.0105.

A contract made expressly for the benefit of a third person may be enforced by him at any time before the parties thereto rescind it. Source: CivC 1877, § 875; CL 1887, § 3499; RCivC 1903, § 1193; RC 1919, § 808; SDC 1939, § 10.0204.

Consent of the parties to a contract must be: (1) Free; (2) Mutual; and (3) Communicated by each to the other. Source: CivC 1877, § 876; CL 1887, § 3500; RCivC 1903, § 1194; RC 1919, § 809; SDC 1939, § 10.0301.

Consent which is not free is not void but voidable and may be rescinded in the manner prescribed by the statutes on rescission. Source: CivC 1877, § 877; CL 1887, § 3501; RCivC 1903, § 1195; RC 1919, § 810; SDC 1939, § 10.0302.

Consent is not mutual unless the parties all agree upon the same thing in the same sense. In certain cases prescribed in the law on interpretation of contracts they are to be deemed so to agree without regard to the fact. Source: CivC 1877, § 891; CL 1887, § 3515; RCivC 1903, § 1…

A contract which is voidable solely for want of due consent may be ratified by a subsequent consent. Source: CivC 1877, § 899; CL 1887, § 3523; RCivC 1903, § 1217; RC 1919, § 832; SDC 1939, § 10.0323.

A voluntary acceptance of the benefit of a transaction is equivalent to a consent to all the obligations arising from it so far as the facts are known or ought to be known to the person accepting. Source: CivC 1877, § 900; CL 1887, § 3524; RCivC 1903, § 1218; RC 1919, § 833; SDC …

An apparent consent is not real or free and is voidable when obtained through: (1) Duress; (2) Fraud; (3) Undue influence; or (4) Mistake. Source: CivC 1877, § 878; CL 1887, § 3502; RCivC 1903, § 1196; RC 1919, § 811; SDC 1939, § 10.0303.

A mistake of law in relation to consent to contract constitutes a mistake resulting in voidable consent only when it arises from: (1) A misapprehension of the law by all parties, all supposing that they knew and understood it and all making substantially the same mistake as to th…

Mistake of foreign laws is a mistake of fact. Source: CivC 1877, § 890; CL 1887, § 3514; RCivC 1903, § 1208; RC 1919, § 823; SDC 1939, § 10.0314.

A provision that errors of description shall not avoid a contract or shall be subject to compensation or both does not take away the right of rescission for fraud, nor for mistake, where such mistake is in a matter essential to the inducement of the contract and is not capable of…

Consent is deemed to have been obtained through duress, fraud, undue influence, or mistake, only when it would not have been given except for one or more of them. Source: CivC 1877, § 879; CL 1887, § 3503; RCivC 1903, § 1197; RC 1919, § 812; SDC 1939, § 10.0304.

Duress consists in: (1) Actual or threatened unlawful confinement of the person of the party, or of husband or wife of such party, or of an ancestor, descendant, or adopted child of such party, husband, or wife; or (2) Actual or threatened confinement of any such person or person…

Fraud is either actual or constructive. Source: CivC 1877, § 882; CL 1887, § 3506; RCivC 1903, § 1200; RC 1919, § 815; SDC 1939, § 10.0306.

Actual fraud in relation to contracts consists of any of the following acts committed by a party to the contract, or with his connivance, with intent to deceive another party thereto or to induce him to enter into the contract: (1) The suggestion as a fact of that which is not tr…

Constructive fraud consists: (1) In any breach of duty which, without any actually fraudulent intent, gains an advantage to the person in fault or anyone claiming under him, by misleading another to his prejudice or to the prejudice of anyone claiming under him; or (2) In any suc…

Undue influence consists: (1) In the use, by one in whom a confidence is reposed by another, or who holds a real or apparent authority over him, of such confidence or authority for the purpose of obtaining an unfair advantage over him; or (2) In taking an unfair advantage of anot…

Mistake may be either of fact or of law. Source: CivC 1877, § 887; CL 1887, § 3511; RCivC 1903, § 1205; RC 1919, § 820; SDC 1939, § 10.0311.

Mistake of fact is a mistake not caused by the neglect of a legal duty on the part of the person making the mistake and consisting in: (1) An unconscious ignorance or forgetfulness of a fact, past or present, material to the contract; or (2) Belief in the present existence of a t…

The object of a contract is the thing which it is agreed, on the part of the party receiving the consideration, to do or not to do. Source: CivC 1877, § 901; CL 1887, § 3525; RCivC 1903, § 1219; RC 1919, § 834; SDC 1939, § 10.0401.

The object of a contract must be lawful when the contract is made and possible and ascertainable by the time the contract is to be performed. Source: CivC 1877, § 902; CL 1887, § 3526; RCivC 1903, § 1220; RC 1919, § 835; SDC 1939, § 10.0402.

Where a contract has but a single object and such object is unlawful in whole or in part, or wholly impossible of performance, or so vaguely expressed as to be wholly unascertainable, the entire contract is void. Source: CivC 1877, § 904; CL 1887, § 3528; RCivC 1903, § 1222; RC 1…

Where a contract has several distinct objects, one or more of which are lawful and one or more of which are unlawful in whole or in part, the contract is void as to the latter and valid as to the rest. Source: CivC 1877, § 905; CL 1887, § 3529; RCivC 1903, § 1223; RC 1919, § 838;…

Any benefit conferred or agreed to be conferred upon the promiser by any other person to which the promiser is not lawfully entitled, or any prejudice suffered or agreed to be suffered by such person, other than such as he is at the time of consent lawfully bound to suffer as an …

Where a contract provides an exclusive method by which its consideration is to be ascertained, which method appears possible on its face but in fact is or becomes impossible of execution, such provision only is void. Source: CivC 1877, § 914; CL 1887, § 3538; RCivC 1903, § 1232; …

Where a contract does not determine the amount of the consideration nor the method by which it is to be ascertained or when it leaves the amount thereof to the discretion of an interested party, the consideration must be so much money as the object of the contract is reasonably w…

An existing legal obligation resting upon the promiser or a moral obligation originating in some benefit conferred upon the promiser or prejudice suffered by the promisee is also a good consideration for a promise to an extent corresponding with the extent of the obligation, but …

A written instrument is presumptive evidence of a consideration. Source: CivC 1877, § 914; CL 1887, § 3538; RCivC 1903, § 1232; RC 1919, § 848; SDC 1939, § 10.0509.

The burden of showing a want of consideration sufficient to support an instrument lies with the party seeking to invalidate or avoid it. Source: CivC 1877, § 914; CL 1887, § 3538; RCivC 1903, § 1232; RC 1919, § 849; SDC 1939, § 10.0510.

The consideration of a contract must be lawful within the meaning of the section defining unlawful contracts. Source: CivC 1877, § 908; CL 1887, § 3532; RCivC 1903, § 1226; RC 1919, § 841; SDC 1939, § 10.0503.

If any part of a single consideration for one or more objects or of several considerations for a single object is unlawful, the entire contract is void. Source: CivC 1877, § 909; CL 1887, § 3533; RCivC 1903, § 1227; RC 1919, § 842; SDC 1939, § 10.0504.

A consideration may be executed or executory in whole or in part. In so far as it is executory, it is subject to the provisions of the statutes relating to object of contract. Source: CivC 1877, § 910; CL 1887, § 3534; RCivC 1903, § 1228; RC 1919, § 843; SDC 1939, § 10.0507.

When a consideration is executory, it is not indispensable that the contract should specify its amount or the means of ascertaining it. It may be left to the decision of a third person or regulated by any specific standard. Source: CivC 1877, § 911; CL 1887, § 3535; RCivC 1903, §…

Where a contract provides an exclusive method by which its consideration is to be ascertained, which method is on its face impossible of execution, the entire contract is void. Source: CivC 1877, § 913; CL 1887, § 3537; RCivC 1903, § 1231; RC 1919, § 846; SDC 1939, § 10.0505.

A proposal may be revoked at any time before its acceptance is communicated to the proposer, but not afterwards. Source: CivC 1877, § 897; CL 1887, § 3521; RCivC 1903, § 1215; RC 1919, § 830; SDC 1939, § 10.0321.

A proposal is revoked: (1) By communication of notice of revocation by the proposer to the other party in the manner prescribed for communication of consent and acceptance, before his acceptance has been communicated to the former; (2) By the lapse of time prescribed in such prop…

An acceptance must be absolute and unqualified or must include in itself an acceptance of that character which the proposer can separate from the rest and which will conclude the person accepting. A qualified acceptance is a new proposal. Source: CivC 1877, § 896; CL 1887, § 3520…

Consent can be communicated with effect only by some act or omission of the party contracting, by which he intends to communicate it or which necessarily tends to such communication. Source: CivC 1877, § 892; CL 1887, § 3516; RCivC 1903, § 1210; RC 1919, § 825; SDC 1939, § 10.031…

If a proposal prescribes any conditions concerning the communication of its acceptance, the proposer is not bound unless they are conformed to; but in other cases any reasonable and usual mode may be adopted. Source: CivC 1877, § 893; CL 1887, § 3517; RCivC 1903, § 1211; RC 1919,…

Consent is deemed to be fully communicated between the parties as soon as the party accepting the proposal has put his acceptance in the course of transmission to the proposer in conformity to §

Performance of the conditions of a proposal or the acceptance of the consideration offered with a proposal is an acceptance of the proposal. Source: CivC 1877, § 895; CL 1887, § 3519; RCivC 1903, § 1213; RC 1919, § 828; SDC 1939, § 10.0319.

A contract in writing takes effect upon its intended delivery for effect to the party in whose favor it is made or to his agent. Source: CivC 1877, § 922; CL 1887, § 3546; RCivC 1903, § 1240; RC 1919, § 861; SDC 1939, § 10.0607.