September 26, 1990

Ms. Gladys Hallett
Fall River County Register of Deeds
Fall River County Courthouse
Hot Springs, SD 57747

OFFICIAL OPINION NO. 90-39

Definition of the Consideration for SDCL 43-4-22(18)

Dear Ms. Hallett:

You have requested an official opinion from this Office concerning the following factual situation:

FACTS:

The 1990 Legislature amended SDCL 43-4-22 to include a new subsection found at SDCL 43-4-22(18). That provision now provides, in pertinent part:

The fee imposed by Section 43-4-21 does not apply to any transfer of title:

(18) For which no consideration was given.

The situation has arisen in our County where there are exchanges of land between parties and they are claiming that these transfers are exempt pursuant to SDCL 43-4-22(18). You had previously issued opinions on the question of whether an exchange of land between parties was subject to the transfer fee imposed by SDCL 43-4-21 and you have held that the transfer fee was applicable. AG Opinion Nos. 70-27, 81-12. The party seeking to record the deeds presently claim that as a result of the Legislative Amendment

SDCL 43-4-22, there is no consideration being exchanged since it merely involves an exchange of land. Our County Attorney has advised me to collect a transfer fee pursuant to SDCL 43-4-21 and that the value of the land being transferred is the value to determine what amount of fee to impose upon the transaction.

Based on the above facts, you have asked the following question:

QUESTION:

Whether SDCL 43-4-22(18) makes an exchange of land between parties exempt from the transfer fee imposed by SDCL 43-4-21?

IN RE QUESTION:

SDCL 43-4-22 was amended by the 1990 Legislature. 1990 S.D. Sess.Laws Ch. 346. The pertinent part of that statute now reads as follows:

SDCL 43-4-22. The fee imposed by 43-4-21 does not apply to any transfer of title:

(18) For which no consideration was given.

The question presented essentially asked whether the "consideration" of SDCL 43-4-22(18) is present when one parcel of land is traded for another parcel.

"One of the primary rules of statutory and constitutional construction is to give words and phrases their plain meaning and effect," In Re Petition of Famous Brands, Inc., 347 N.W.2d 882, 885 (S.D. 1984). Consideration has been defined as "[s]omething promised, given, or done that has the effect of making an agreement a legally enforceable contract." American Heritage Dictionary 284 (New College Ed. 1982). Consideration has also been defined as "[s]ome right, interest, profit or benefit accruing to one party, or some forbearance, detriment, loss, or responsibility, given, suffered, or undertaken by the other." Black's Law Dictionary 277 (5th Ed. 1979). In a criminal context, consideration has been defined as follows:

SDCL 22-1-2. ...

(7) "Consideration," any type of property or thing of legal value, whether delivered in the past, present or to be delivered in the future. The term includes an unfulfilled promise to deliver. The term may include an advantage or benefit to the promisor or a loss or detriment to the promisee. Any amount, advantage or inconvenience, no matter how trifling, is sufficient to constitute consideration....

Under the facts presented, one party is exchanging one parcel for another parcel of property. I am of the opinion that trading one parcel for another parcel is a transaction in which there is consideration present, and therefore the exemption of SDCL 43-4-22(18) does not apply. Further, I am in agreement with your local State's Attorney that the value of the land being transferred is the value to determine the amount of fee to impose upon the transaction.

I did note that, in your letter to me, you indicated that the U.S. Forest Service is or may be involved in some of these transactions. I am sure you are aware that SDCL 43-4-22(2) exempts these transactions from the fee.

Sincerely,

ROGER A. TELLINGHUISEN
ATTORNEY GENERAL

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