Could a warranty deed signed by the original purchaser of a South Dakota school lands contract of sale be accepted by the Commissioner of School and Public Lands as a valid assignment of the contract, especially after the purchaser had died and his widow submitted the deed and an affidavit of lost contract?
Plain-English summary
The Commissioner of School and Public Lands asked the AG how to handle a peculiar fact pattern. The state had originally sold a tract of school land to a private purchaser under a contract of sale (the standard pre-patent installment mechanism South Dakota used to convey school lands). The purchaser made the full payments and earned the right to a patent. Before requesting the patent, the purchaser executed a warranty deed in 1960 to a third party, but did not submit it to the Commissioner for approval. The purchaser died in 1967. His widow then surfaced the warranty deed, executed an affidavit of lost contract, and recorded the deed shortly after his death.
The Commissioner needed to know: could the deed be accepted as an assignment of the contract, and if so, did that allow the patent to issue to the deed's grantee rather than to the original purchaser's estate?
The AG answered five sub-questions:
- Can a warranty deed be accepted as an assignment of an unpaid contract of sale? YES.
- Can a quit claim deed similarly serve as an assignment? YES.
- Does the Commissioner have authority, this late, to approve the previously unrecorded warranty deed as an assignment? YES.
- Would doing so circumvent the SDC 15.0312 procedure for handling the death of an original purchaser? NO.
- Would the analysis change if the warranty deed had been recorded before the purchaser's death? NO.
The reasoning combined statutory text with two prior AG opinions:
- A 1947-48 opinion (1947-48 AGR 275) had held that an assignee taking under a final decree of distribution did not need a separate court adjudication of patent-entitlement; the decree itself was sufficient.
- A 1945-46 opinion (1945-46 AGR 401) had specifically recognized that a quit claim deed could convey interest in school lands subject to a contract of sale, with the patent then issuing to the holder of the deed.
SDC 1960 Supp. 15.0308 required that any assignment of contract rights or conveyance of any interest in school lands be approved in writing by the Commissioner. SDC 15.0312 required, on the death of an original purchaser or assignee, that a court of competent jurisdiction adjudge the person entitled to the patent before the patent issued. The AG read those two provisions together as a sequence: the Commissioner approves assignments made during the original purchaser's lifetime; the court determines who takes after the purchaser's death.
The warranty deed executed in 1960 had occurred while the original purchaser was alive. The fact that it was not submitted for the Commissioner's approval until after the purchaser's death did not change when the legal transfer happened. The deed therefore qualified as an assignment, and the Commissioner could approve it without involving the probate court.
Currency note
This opinion was issued in 1967 (approximate, based on the death year and statutory references in the opinion). Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here. South Dakota's school lands code has been recodified into SDCL Title 5 and modern provisions on patent issuance and contract assignment may differ from the SDC 1960 Supp. citations used here.
What the opinion meant at the time
For the Commissioner of School and Public Lands, the opinion gave a workable path through what looked like a deadlocked situation. Rather than forcing the widow into probate court to litigate who was entitled to the patent (which the deed's grantee had taken from the original purchaser years earlier), the Commissioner could simply approve the assignment that had been documented in the 1960 warranty deed.
For South Dakota title examiners and real estate practitioners, the opinion reinforced an important point: school lands held under an unfulfilled contract of sale were alienable, and the contract holder's interest could be transferred by warranty deed or quit claim deed during life, subject to the Commissioner's later approval. The transfer's effective date was the deed's execution, not the date of the Commissioner's approval.
For attorneys handling the estates of school lands contract holders, the opinion meant that if the decedent had transferred his interest before death, the patent path bypassed the probate court entirely. The transfer cleared the decedent's interest from the estate. SDC 15.0312's death procedure applied only when the original purchaser (or assignee) died still holding the contract interest.
For the third-party grantee who held a years-old unrecorded warranty deed, the opinion meant that recording it after the grantor's death and presenting it to the Commissioner was enough to start the patent process in the grantee's name. The grantee did not lose the property because the grantor had failed to submit the deed for approval during his lifetime.
Common questions
Q: Is this opinion still good law?
A: Not directly. The statutory citations are to the 1960 SDC and its 1949 session law amendment. South Dakota's modern school lands code is in SDCL Title 5; specific provisions on contract assignments and patent issuance have been recodified and revised. The general principle, that contract holders can transfer their interest during life subject to Commissioner approval, has been broadly carried forward, but anyone working a current school lands transaction should consult the current SDCL provisions and current Commissioner practice.
Q: What was a school lands "contract of sale" in the 1960s?
A: South Dakota had received millions of acres of school lands from the federal government at statehood under the Enabling Act. Those lands were sold to private buyers to fund public schools. The state did not transfer title (the patent) until the buyer had completed all installment payments. Until then, the buyer held an equitable interest under the contract of sale; the legal title remained in the state. SDC ch. 15 governed the process.
Q: Why did the SDC require Commissioner approval of any assignment?
A: To protect the state's interest. Until the patent issued, the state held legal title and was owed the remaining contract payments. Letting the original purchaser secretly assign the contract to a stranger would have made it harder for the state to know who to look to for payment, to deliver the patent at the end, and to enforce the contract's other terms. The approval requirement gave the state notice of who currently held the contract.
Q: What happened if the original purchaser died still holding the contract?
A: Under SDC 15.0312, the patent could not issue until a court of competent jurisdiction adjudicated who was entitled to it. In practice that meant the decedent's estate went through probate, the decree of distribution named the contract as an asset, and the heir or devisee named in the decree could then present the decree to the Commissioner to get the patent.
Q: What practical step did the widow take that triggered the AG's opinion?
A: She submitted both a warranty deed (signed by the late purchaser in 1960) and an affidavit of lost contract, with a certified copy of the death register. The deed showed the purchaser had transferred his interest to a third party before his death; the affidavit substituted for the original contract document that had apparently been lost. The combination forced the Commissioner to decide whether the deed could function as an assignment for purposes of the patent.
Background and statutory framework
The opinion turned on two statutes:
SDC 1960 Supp. 15.0308 governed the original sale and conveyance procedure. After the Governor approved a sale, the Commissioner executed the contract; one copy filed with the Commissioner, the other delivered to the purchaser through the county auditor. The key restriction was that any assignment of contract rights or conveyance of any interest in the lands "shall be of no force or effect, unless or until such assignment or conveyance be first approved, in writing, by the Commissioner of School and Public Lands."
SDC 15.0312 governed patent issuance. When full payment had been made, a patent issued in the state's name (executed by the Governor, attested by the Commissioner), delivered to the county auditor for the person entitled. If the original purchaser was alive and had not assigned, the patent ran to him. If a legal transfer had been made, the patent ran to the actual owner as shown by documentary evidence approved by the state's attorney, treasurer, and auditor of the county. If the original purchaser or his assignee had died, a court of competent jurisdiction had to adjudge who was entitled before the patent issued.
The AG read those two provisions as a sequence (Commissioner approves living assignments; court adjudges post-death entitlements) and concluded the warranty deed at issue fit the first track, not the second, because the deed was executed during the original purchaser's lifetime even though it was approved later.
Citations and references
Statutes (as cited in the opinion):
- SDC 1960 Supp. 15.0308 (school lands contract assignment requires Commissioner approval)
- SDC 15.0312 (patent issuance, including procedure on death of original purchaser or assignee)
Prior AG opinions referenced:
- 1947-48 AGR 275 (assignee under final decree of distribution not required to be separately adjudged entitled to patent)
- 1945-46 AGR 401 (quit claim deed transferring interest in school lands; patent issues to deed holder)
Source
Original opinion text
Commissioner of School and Public Lands. Construction of Statutes SDC 1960 Supp. 15.0308 and SDC 15.0312 relating to contract of sale of school lands.
You submitted to this office the following letter of inquiry:
"May we have your valued official opinion upon the following:
"Following payment in full of a Contract of Sale of School Lands, this office requested the purchaser of the tract of land to forward his copy of the Contract of Sale or execute an affidavit of lost contract in lieu thereof.
"Today, we received in the mail, an affidavit of lost contract, executed by the wife of the original purchaser, together with a Warranty Deed and a certified copy of the Death Register.
"The Warranty Deed was dated February 8, 1960.
"The Death Register shows the date of the death of the purchaser as being March 23, 1967.
"The Warranty Deed was recorded in the office of the Register of Deeds March 30, 1967.
"Subsequent to the execution of the contract, Chapter 48 of the 1949 Session Laws was enacted and became effective July 1, 1949, and is now cited as SDC 1960 Supp. 15.0308, and provided in part that:
" 'Any assignment of any rights under such contract, or conveyance of any interest in the lands therein described, shall be of no force or effect, unless or until such assignment or conveyance be first approved, in writing, by the Commissioner of School and Public Lands.' "
"Of course, at the time the Warranty Deed mentioned above presumably was executed, the contract holder had only a color of title and had nothing to warrant, and even if the Warranty Deed had been a legal transfer of title to the real estate, it was not approved by the Commissioner."
The questions are:
"1. Can any Warranty Deed be accepted and approved by the Commissioner as an assignment of an unpaid Contract of Sale?
"2. Can a Quit Claim Deed be accepted and approved as an assignment of an unpaid Contract of Sale?
"3. Does the Commissioner now at this late date have the authority or duty to approve the unrecorded Warranty Deed as an assignment?
"4. If he does so, would the provisions of SDC 15.0312 and the specific requirements in case of the death of the original contract holder be circumvented?
"5. Would the circumstance be altered if a Warranty Deed recorded prior to the death of the maker, the original purchaser, were submitted to the Commissioner subsequent to the death of the original purchaser, as an assignment to be approved by said Commissioner?"
SDC 15.0312 provides that:
"15.0312 Patent on completion of contract payments: duty of Commissioner; successors to interest of original purchaser; records; homestead rights. When full payment had been made for any tract sold, and not before, a patent for such tract executed in the name of the state by the Governor, and attested by the Commissioner, under the seal of his office, shall be made out and delivered by the Commissioner to the auditor of the county in which the land is situated, for the person entitled thereto. Such patent shall run to the original purchaser, if he be living and his interest in the land has not been assigned, but, in case a legal transfer of his interest has been made, such patent shall run to the actual owner of such interest, as may appear from documentary evidence approved by the state's attorney, treasurer, and auditor of the county in which the land is situated, the same to be filed with the application for the patent. In case of the death of the original purchaser or his assignee, a patent shall not be issued until a court of competent jurisdiction shall have ascertained and adjudged the person entitled thereto and a certified copy of the decree or order of such court shall have been filed with the application for patent."
SDC 1960 Supp. 15.0308 has not been amended in any manner, except approval of conveyance of assignment required, as stated in Paragraph 6 of your letter, which reads in part as follows:
"Should the Governor approve the sale, he shall certify to such approval upon the contract, and the Commissioner shall thereupon execute the same. One copy of such contract shall be filed in the office of the Commissioner, and the other shall be forwarded to the county auditor to be delivered to the purchaser after the expiration of sixty days from the date of sale.
"Any assignment of any rights under such contract, or conveyance of any interest in the lands therein described, shall be of no force or effect, unless or until such assignment or conveyance be first approved, in writing, by the Commissioner of School and Public Lands."
In construing the provisions of SDC 15.0312, one of my predecessors rendered an opinion that the assignee of incompleted sale contract from distributee in a final decree was not required to be adjudged as being entitled to a patent. (See 1947-48 AGR 275).
It was held in this opinion that it was not necessary that the commissioner have an additional order of a competent court naming the person entitles to patent as required by SDC 15.0312. The opinion reads in part as follows:
" 'In case of the death of the original purchaser his assignee, a patent shall not be issued until a court of competent jurisdiction shall have ascertained and adjudged the person entitled thereto.' "
"The decree of distribution assigning the contract to the husband is and adjudication that he is the owner of the contract, entitled to all rights flowing therefrom and entitled to the patent upon compliance with the contract. He may either complete the contract or dispose of it as he may desire: The statute does not mean that a purchaser or assignee of the contract from the person adjudicated to be entitled thereto must in order to obtain a patent be likewise adjudged by a court of competent jurisdiction to be entitled to a patent on compliance with its terms. The statute may be somewhat misleading in its phraseology, however, to hold otherwise that as above indicated would be to indulge in a process of reasoning wholly inconsistent with the obvious design of the statute which is to assure that on death of the original purchaser the contract passes to the person or persons entitled thereto by laws of descent."
I draw your attention to an opinion of this office dated September 17, 1946 reported in the 1945-46 AGR 401, which held that patent issues to holder of interest in land required by quit claim deed. This opinion reads in part as follows:
"The interest acquired in land under such a contract is alienable and is so recognized by the Statute (SDC 15.0312) wherein the following language is used:
" '...Such patent shall run to the original purchaser, if he be living and his interest on the land has not been assigned, but, in case a legal transfer of his interest has been made such patent shall run to the actual owner of such interest, as may appear from documentary evidence approved by the State's Attorney, treasurer and auditor of the county in which the land is situated, the same to be filed with the application for the patent...' "
Question No. 1 is answered in the AFFIRMATIVE.
Question No. 2 is answered in the AFFIRMATIVE.
Question No. 3 is answered in the AFFIRMATIVE.
Question No. 4 is answered in the NEGATIVE.
Question No. 5 is answered in the NEGATIVE.