Yesterday morning the SD Supreme Court held that a Fall River County Circuit Court erred in declaring that a real estate lease for a concrete bunker was illusory. The dispute concerns a 99 year lease for a concrete bunker created in WW II to store bombs and munitions. It is one of 575 such bunkers. The Tenant entered into this leasein July 2020, making a one-time payment of $35,000. The Lessor reserved the right to promulgate rules and regulations. One of those rules related to the use of firearms on the leased property. Based upon an alleged violation the firearm regulation by the tenant, Lessor sought to evict the tenant in January 2024. The case was assigned to Hon. Scott Roetzel who ruled in favor of the tenant, stating, “the 99-year lease is an illusory contract that [Lessor] can unilaterally modify the terms of at any time with no recourse for [Tenant].” (emphasis added to the word illusory by this writer). Lessor appealed. The SD Supreme Court reversed and remanded this morning, April 23, holding, “[¶24.] … the lease agreement entered between [Lessor] and [Tenant] is a valid contract.”
The case is remanded to the trial court, with the following instructions:
[¶27.] [Lessor’s] community rules and regulations are not illusory and are therefore enforceable. And any modifications to the rules and regulations are also enforceable, so long as they are reasonable, made in good faith, equally enforced, and not adopted for the purpose of evading the lessor’s obligations under the lease or depriving any tenant of the benefit of their lease.
The Court’s decision is unanimous (5-0), with opinion authored by Justice Salter. Circuit Judge Hoffmann sat on this case, in lieu of Justice Gusinsky.
The Lessor in this matter was represented by Eric M. Schlimgen of Spearfish. The Tenant was represented by Matthew Hays McCoy and J. Scott James of Custer of Custer.
NOTE: Tenant’s request for appellate attorney fees was denied, with the Court noting that Tenant did not prevail on appeal.
A copy of this decision, VIVOS XPOINT v. SINDORF, 2026 S.D. 25, may be obtained by sending an e-mail request to rogermbaron@gmail.com .
