When a South Dakota sheriff conducts a foreclosure-by-advertisement sale of real estate and the only bid comes from the mortgagee bank itself (bidding in the property to clear its lien), what fee can the sheriff charge? The percentage commission for sales over $1,000 would be a meaningful amount.

Plain-English summary

A mortgagee bank started foreclosure-by-advertisement proceedings under SDCL chapter 21-48 concerning real property in Davison County. The sale was held on the courthouse steps on April 18, 1977. The only bid came from the mortgagee bank itself, for $13,463.48.

Sheriff Swenson asked AG Bill Janklow what fee he could charge. The percentage-commission statute, SDCL 7-12-18(29), would produce a much larger fee on a $13,463 sale than the flat-fee statute, SDCL 7-12-18(30), which produced a twenty dollars fee. Which controlled?

Janklow's answer was the twenty dollars flat fee. Three intertwined reasons.

First, SDCL 7-12-18(30) is the specific provision for cases where "persons in whose favor the execution or order of sale is issued shall bid in the property sold on execution or decree." The mortgagee bank fit that description: it was the party that started the foreclosure, and it bid in the property. The specific statute controls over the more general percentage-commission statute (the standard rule for resolving conflicts between general and specific provisions, citing Sutherland on Statutory Construction).

Second, the percentage commission under SDCL 7-12-18(29) applies to money the sheriff actually receives and disburses. In the mortgagee purchase described, Janklow said there was no receipt or disbursement of funds, only a paper transaction in which the sheriff did not handle the money. He cited decisions from five other states supporting that treatment and one contrary Minnesota decision.

Third, SDCL 7-12-18(31) requires that the sheriff's fee for foreclosure by advertisement be the same as for judicial foreclosure. So the foreclosure-procedure label (advertisement under chapter 21-48 versus judicial under chapter 21-47) does not change the fee. The twenty dollars cap in 7-12-18(30) applies regardless of the procedural path the foreclosure took.

For the foreclosure by advertisement presented, with the mortgagee bank as sole bidder at $13,463.48, Janklow concluded that the sheriff was entitled to twenty dollars and no more. He read SDCL 7-12-18(30) as setting the fee when the mortgagee purchases the property, and SDCL 7-12-18(29) as governing other foreclosure sales. The opinion did not decide a contested sale or a personal-property sale.

Currency note

This opinion was issued in 1977. 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. SDCL 7-12-18 may have been amended since 1977, and the subdivision numbers and dollar amounts cited here may have changed. Anyone analyzing current sheriff foreclosure fees should consult the current statute, not this 1977 framework.

What the opinion meant at the time

For county sheriffs running foreclosure-by-advertisement sales, the opinion gave a fee answer for a real-property sale in which the mortgagee bank was the sole bidder. A bid above $1,000 yielded the twenty dollars fee under SDCL 7-12-18(30), as applied through subdivision (31). The opinion did not calculate the fee for a contested sale.

For county auditors processing sheriff fee claims, the opinion identified the fee for the transaction presented as twenty dollars rather than a percentage commission. Compare the sale facts with the opinion before applying that conclusion.

For a mortgagee bank in the same position as the sole bidder here, the opinion put the sheriff's fee at twenty dollars on a bid greater than $1,000 under the statutes then in force.

For borrowers, the opinion addressed only the sheriff's fee for this sale. It did not determine how that fee affected any deficiency or surplus.

For South Dakota statutory construction generally, the opinion is a clean example of the specific-over-general rule. When two statutory provisions overlap, the more specific provision controls. The percentage commission in 7-12-18(29) was general; the flat fee in 7-12-18(30) was specific to creditor buy-ins; the specific provision won.

Common questions

Q: Did the opinion address a deficiency after foreclosure?
A: No. It answered the sheriff-fee question for a real-property foreclosure by advertisement with the mortgagee bank as sole bidder. It did not discuss a deficiency.

Q: What if there are two bidders, the mortgagee and a third party, and the mortgagee wins with a higher bid?
A: Janklow was asked about a sale where the mortgagee bank was the sole bidder. He did not decide the fee for a contested sale that the mortgagee wins.

Q: Does the twenty dollars cap apply only to real estate foreclosures, or also to personal property sales on execution?
A: The opinion decided only a foreclosure by advertisement of a real-property mortgage. Although it quoted SDCL 7-12-18(30), it did not decide the fee for a personal-property sale on execution.

Q: What about the publication and other foreclosure costs?
A: The opinion only addresses the sheriff's fee. It gives no answer about publication, recording, or other costs.

Q: Has South Dakota raised the twenty dollars cap?
A: The cap may have been amended since 1977. Current SDCL 7-12-18 should be consulted for the current figure.

Background and statutory framework

The opinion compares foreclosure by judicial action under SDCL chapter 21-47 with foreclosure by advertisement under chapter 21-48. SDCL 7-12-18(31) required the sheriff's fee for an advertisement foreclosure to match the fee for a judicial foreclosure.

SDCL 7-12-18(29) described a commission on money received and disbursed by the sheriff. Subdivision (30) prescribed $10 when the creditor bid in property for $1,000 or less, and twenty dollars when the bid exceeded $1,000. Janklow applied the latter amount to the mortgagee bank's $13,463.48 bid.

Subdivision (31) required the same sheriff's fee for foreclosure by advertisement as for judicial foreclosure. Janklow reasoned that limiting subdivision (30) to judicial actions would leave subdivision (31) without effect.

Janklow cited decisions from Louisiana, Ohio, Oklahoma, Utah, and Washington that disallowed percentage commissions when the mortgagee bank purchased at foreclosure, and identified Sharvey of Minnesota as contrary authority.

Citations

• SDCL 7-12-18(29), (30), (31)
• SDCL chapters 21-47, 21-48
• 1A Sutherland, STATUTORY CONSTRUCTION § 23.16 (4th Ed. 1972)
• 80 C.J.S., Sheriffs and Constables, § 221b
• Investors' Mortgage Co. v. Prejean, 8 La. App. 46 (1928)
• Trumbull Savings and Loan Association v. Jones, 27 Ohio N.P., N.S. 469 (1929)
• Berry v. Kiefer, 133 P. 1126 (Okl. 1913)
• Peery v. Wright, 45 P. 46 (Utah 1896)
• State ex rel. Thompson v. Prince, Sheriff, 37 P. 291 (Wash. 1894)
• Sharvey v. Central Vermillion Iron Co., 58 N.W. 864 (Minn. 1894) (contra)

Source

• Landing page: https://atg.sd.gov/OurOffice/OfficialOpinions/opinionhtml.aspx?id=1050

Original opinion text

Sheriff's fees: foreclosure by advertisement of a real property mortgage when the purchaser is the mortgagee

Dear Sheriff Swenson:

You have requested an official opinion based on the following facts:

FACTS:

The Mortgagee-Bank instituted foreclosure by advertisement proceedings against the Mortgagor of certain real property situated in Davison County pursuant to SDCL 21-48. The sale was duly advertised, and was held on the steps of the Davison County Courthouse on April 18, 1977. The only bid received was from the Mortgagee-Bank in the amount of $13,463.48.

The question presented is:

QUESTION:

To what fee is the sheriff entitled for foreclosure by advertisement of a real property mortgage when the purchaser (and sole bidder) is the Mortgagee-Bank?

Fees and traveling expenses receivable by sheriffs are governed by SDCL 7-12-18. The following three subdivisions are pertinent to your inquiry:

SDCL 7-12-18. The sheriff shall be entitled to charge and receive the following fees and traveling expenses:

(1) to (28) . . .

(29) His commission on all money received and disbursed by him on execution or order of sale, order of attachment, decree or on sale of real property or personal property, shall be, for each dollar not exceeding four hundred dollars, six cents; for every dollar above four hundred dollars, and not exceeding one thousand dollars, three cents; for every dollar above one thousand dollars, not to exceed fifteen thousand dollars, two cents; but in no case less than a sum of ten dollars such commissions to be included as a part of the cost of execution, order of sale, order of attachment, decree, or on sale of real or personal property, to be paid by redemptioner in all cases of redemption;

(30) In all cases in the circuit court where persons in whose favor the execution or order of sale is issued shall bid in the property sold on execution or decree, the sheriff or officer making such sale shall receive the following compensation: If the amount for which the property is bid in shall be one thousand dollars or less, the sum of ten dollars and no more; if the amount for which the property is bid in be more than one thousand dollars, the sum of twenty dollars and no more;

(31) The sheriff making a sale of real property under a foreclosure of mortgage by advertisement shall receive the same fees as for the sale of real property under a judgment of foreclosure and sale of real property;

It is my opinion that SDCL 7-12-18(30) is controlling in the fact situation which you presented.

First, SDCL 7-12-18(30) is a very specific statute, limited in application to those cases "where persons in whose favor the execution or order of sale is issued shall bid in the property sold on execution or decree." It is a well-settled rule of statutory construction that when two statutes are in apparent conflict, the more specific statute is controlling. 1A Sutherland, STATUTORY CONSTRUCTION § 23.16 (4th Ed. 1972).

Secondly, court decisions in other jurisdictions have generally disallowed percentage commissions in cases where the Mortgagee-Bank is the purchaser at the foreclosure sale. 80 C.J.S., Sheriffs and Constables, § 221b. The percentage commission is not chargeable on account of the sale alone, but only in the event that the sheriff actually "received and disbursed" (SDCL 7-12-18(29)) the proceeds of the sale. In those cases in which the purchaser is the Mortgagee-Bank, there is no actual receipt or disbursement of funds. There is merely a paper transaction in which the sheriff incurs no risk or responsibility for handling the money. He is, therefore, entitled only to a fee (if one is set by statute) for his services in conducting the sale. Investors' Mortgage Co. v. Prejean, 8 La. App. 46 (1928); Trumbull Savings and Loan Association v. Jones, 27 Ohio N.P., N.S. 469 (1929); Berry v. Kiefer, 133 P. 1126 (Okl. 1913); Peery v. Wright, 45 P. 46 (Utah 1896); State ex rel. Thompson v. Prince, Sheriff, 37 P. 291 (Wash. 1894), contra, Sharvey v. Central Vermillion Iron Co., 58 N.W. 864 (Minn. 1894).

Furthermore, if SDCL 7-12-18(30) is interpreted to apply only to foreclosures by judicial action (SDCL 21-47) "in the circuit court," and not to foreclosures by advertisement (SDCL 21-48), SDCL 7-12-18(31) is not given effect. SDCL 7-12-18(31) requires that in all cases, the sheriff is to receive the same fee in a foreclosure by advertisement as he would be entitled to receive for a foreclosure by judicial action in the circuit court.

In my opinion, the only interpretation which can reconcile these three subdivisions is:

SDCL 7-12-18(29) sets the sheriff's fee in foreclosure actions in all cases except where the purchaser at the foreclosure sale is the mortgagee.

SDCL 7-12-18(30) sets the sheriff's fee in the specific case where the purchaser at the foreclosure sale is the mortgagee.

SDCL 7-12-18(31) requires that in all cases the sheriff's fee for foreclosure by advertisement be the same as the sheriff's fee for foreclosure by judicial action.

Based on the foregoing, it is my opinion that in a foreclosure by advertisement of a real property mortgage when the purchaser and sole bidder is the Mortgagee-Bank, the sheriff is entitled to recover the sum of "twenty dollars and no more" when the amount for which the property is bid in is more than one thousand dollars ($1,000).

Respectfully submitted,

William J. Janklow

Attorney General

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