LLC Manager Appointment, Removal, Resignation, and Vacancy Requirements in South Dakota
At a glance
| Governing law, entity, manager, member, and scope | South Dakota Uniform Limited Liability Company Act, SDCL ch. 47-34A, plus ch. 59-11 reporting rules; ordinary domestic manager-managed LLC and its manager, not a member, organizer, agent, employee, officer, delegate, professional/series LLC, liquidator, or disputed authority outcome (§§ 47-34A-101, -1202) |
|---|---|
| Manager-managed election and operating-agreement override | Manager-managed only if designated in the articles, which name each initial manager. The operating agreement governs member-manager-company relations and may replace appointment, removal, resignation, term, and vacancy defaults within § 47-34A-103's limits; internally it controls over conflicting filed text (§§ 47-34A-101(11), -103, -103.1, -203) |
| Appointment actor, threshold, and record | Vote, approval, or consent of a majority of the members designates, appoints, elects, or replaces a manager—member headcount by default, not profit or contribution percentage. Action may occur without a meeting; a signed instrument is required only to appoint a proxy under this section. Articles may create member classes with voting rights (§§ 47-34A-404.1(b)(3), (d)-(e), -404.2) |
| Eligibility, number, and term | Manager may be a member or nonmember and a statutory 'person,' including an individual or entity. One or multiple managers may serve; each has equal management rights. No express age, residency, licensing, number cap, or fixed term; holdover lasts until a successor is elected and qualified unless earlier resignation or removal (§§ 47-34A-101(10), (15), -404.1(b)) |
| Removal actor, threshold, notice, cause, and timing | A majority of the members removes a manager by vote, approval, or consent. The Act states no general cause, advance-notice, meeting, acceptance, event-filing, or effective-time condition; the operating agreement or permitted class-voting terms may change the internal process (§§ 47-34A-103, -404.1(b)(3), (d), -404.2) |
| Resignation, acceptance, timing, and successor | Section 47-34A-404.1 recognizes resignation as ending the holdover but states no general writing, signature, delivery recipient, advance period, acceptance, filing, future-date/event, or advance-successor procedure. The operating agreement and other applicable agreements supply additional mechanics (§§ 47-34A-103, -404.1(b)(3)) |
| Vacancy, successor, holdover, death, and incapacity | A member majority designates, appoints, elects, or replaces the successor; incumbent holds over until the successor is elected and qualified unless resignation or removal occurs first. Chapter 47-34A states no separate manager-vacancy list for death, incapacity, disqualification, entity termination, or term expiration, and no remaining-manager filler or mandatory-replacement rule (§ 47-34A-404.1(b)(3)) |
| Member-manager status, dissociation, and filings | Member dissociation ends member status and the member's right to participate in management, but the Act does not expressly say it also ends a separately held manager office; manager cessation is not itself a listed member-dissociation event. Initial articles name every initial manager; annual reports list current governors/managers, with no prompt standalone manager-change filing stated (§§ 47-34A-203, -601, -603; 59-11-2(11), -24) |
| Continuing liability, authority, employment, fiduciary, and judicial boundaries | Manager status alone creates no personal liability for company obligations; prior wrongful-distribution liability and duties are not erased by ending office. Agency, contracts/employment, reimbursement, indemnification, fiduciary duties, member expulsion, dissolution, and post-dissolution authority remain separate (§§ 47-34A-301, -303, -407, -409, -601, -804) |
Requirements one by one
Manager management begins in the articles
Under SDCL § 47-34A-101(11), a South Dakota LLC is manager-managed only if its articles designate that form. The articles must also give the name and address of every initial manager under § 47-34A-203(a)(6).
Under § 47-34A-103, the operating agreement governs relations among members, managers, and the company. Chapter 47-34A supplies the fallback where the agreement is silent, and the agreement controls internally over conflicting filed text except for the Act's nonwaivable limits and protected third-party reliance under § 47-34A-103.1.
A majority of members appoints and removes
§ 47-34A-404.1(b)(3) requires a manager to be designated, appointed, elected, removed, or replaced by a vote, approval, or consent of a majority of the members. The default therefore follows member headcount, not a percentage of profit interests or contributions. Articles may create member classes with different voting rights under § 47-34A-404.2, and the operating agreement may vary the default.
The action may occur without a meeting. A proxy appointment must be signed, but the section does not impose a separate writing or signature condition on the members' direct vote, approval, or consent.
The Act does not expressly require cause, advance notice, acceptance, a public filing, or a separate effective-time step for removal. Governing documents and service or employment agreements can add process or consequences.
Managers may be nonmembers or entities and hold over
The manager definition permits a manager who is not a member, and the Act's definition of “person” includes individuals and legal or commercial entities. One manager decides alone; where there are multiple managers, each has equal management rights and a majority decides ordinary company business.
The incumbent holds office until a successor is elected and qualified unless the manager sooner resigns or is removed. Chapter 47-34A states no general age, residency, licensing, manager-number cap, or fixed term.
Resignation is recognized but not proceduralized
Section 47-34A-404.1 recognizes resignation as an event that ends the statutory holdover. It does not prescribe a general manager-resignation writing, signature, delivery recipient, advance-notice period, acceptance condition, filing, future date or event, or advance-successor procedure.
The same member majority may replace a manager. The current Act does not give a separate manager-vacancy list for death, incapacity, disqualification, termination of an entity manager, or term expiration, and it does not give a remaining manager a general unilateral vacancy-filling power. Those mechanics must come from the operating agreement and other applicable law.
Member status, manager office, and public reporting are distinct
§ 47-34A-601 and § 47-34A-603 govern member dissociation. Dissociation ends member status and the person's right, as a member, to participate in management. The Act does not expressly say that it also ends a separately held manager office. Conversely, manager resignation or removal is not itself among the listed member-dissociation events.
Initial articles identify every initial manager. Under § 59-11-24, later annual reports must list the LLC's current “governors,” a term that covers the people under whose authority and direction the company is managed. For a manager-managed LLC, that includes its managers under § 59-11-2(11). The report must be current when executed, but the Act states no prompt standalone manager-change filing. The internal member action—not the report—creates or ends the office.
Enacted 2026 HB 1102, §§ 1-2 changes annual-report scheduling on January 1, 2027 by allowing an anniversary-month or January 31 schedule. It does not change the manager/governor disclosure.
Ending office does not settle authority or liability
Under § 47-34A-303, manager status alone does not make a person liable for company debts. § 47-34A-407 separately preserves potential liability for a manager who approved an improper distribution, subject to its two-year filing limit, and § 47-34A-409 governs manager duties.
Agency under § 47-34A-301, post-dissolution authority under § 47-34A-804, employment and service contracts, compensation, reimbursement, indemnification, fiduciary claims, member expulsion, and dissolution remain separate questions. Ending the office does not decide those issues.
What trips people up
- The default is member headcount. Do not substitute profit interests or contribution percentages for a majority of the members.
- The holdover is express. A manager remains until a successor is elected and qualified unless resignation or removal occurs sooner.
- Resignation has no general statutory form. The operating agreement should supply delivery, notice, acceptance, and timing mechanics.
- The annual report is disclosure, not appointment. Its timing changes in 2027, but the internal member action remains the source of manager office.
Common questions
Must a South Dakota LLC manager be a member or an individual?
No. A manager may be a nonmember, and the Act's person definition includes individuals and entities.
May members act without a meeting?
Yes. Section 47-34A-404.1(d) permits action requiring member consent without a meeting. A proxy appointment must be signed.
Does South Dakota prescribe a manager resignation form?
No general form, delivery recipient, notice period, acceptance rule, or filing appears in current Chapter 47-34A. The operating agreement should supply the procedure.
Does removing a manager automatically end membership?
No such automatic consequence appears in the member-dissociation list. Manager office and membership should be analyzed separately under the governing documents and the Act.
Statutes and sources
- SDCL §§ 47-34A-101, -103, -103.1, -203, -404.1, and -404.2 — manager, member, person, management form, operating-agreement hierarchy, initial manager disclosure, appointment, removal, replacement, holdover, resignation, no-meeting action, proxy, and class voting. Official § 47-34A-404.1 (accessed August 30, 2026).
- SDCL §§ 47-34A-601 and -603; 59-11-2 and -24 — member dissociation and management-right effect, governor definition, and current annual-report manager disclosure. Official § 47-34A-603 and § 59-11-24 (accessed August 30, 2026).
- SDCL §§ 47-34A-301, -303, -407, -409, and -804 — agency, status-only liability protection, improper distributions, duties, and post-dissolution authority. Official § 47-34A-303 (accessed August 30, 2026).
- 2026 South Dakota HB 1102, §§ 1-2 — annual-report schedule beginning January 1, 2027. Official enrolled text (accessed September 5, 2026).
Source links
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