Thunderstik Lodge, Inc. v. Reuer
South Dakota Supreme Court
613 N.W.2d 44 (2000)
Thunderstik Lodge (plaintiff) leased agricultural land from the Reuers (defendants) for a 10-year term with two additional 10-year renewal options at increasing rent ($33,000 for the first renewal, $36,000 for the second), with a severability clause preserving the remainder of the agreement if any portion was held invalid; because South Dakota law capped agricultural leases at 20 years, the Reuers sought a declaratory judgment that the resulting 30-year lease was entirely invalid. The circuit court found only the second 10-year extension invalid and severed it, leaving the rest enforceable, and the Reuers appealed, arguing severance was improper.
Whether, for a contract to be severable, (1) the parties' performances must be separable into corresponding pairs of part performances, and (2) the parts of each pair must be for equivalent value.