871 N.W.2d 508
S.D.2015Background
- Aggregate delivered Type 2A aggregate samples to Swan for sodium‑sulfate soundness testing in Dec. 2007/Jan. 2008 to determine SDDOT compliance for a DOT project.
- Swan reported preliminary passing results; SDDOT later tested the Ophiem pit material and reported failing results, prompting blending and re‑testing of stockpiles.
- Disputes over sampling and testing delayed Aggregate’s deliveries; Bituminous Paving obtained substitute material, charged Aggregate increased costs, and withheld payment.
- Aggregate sued SDDOT for damages, then settled and executed a Full and Final Release with SDDOT for $172,500, which broadly released SDDOT and "all others directly or indirectly liable" for claims arising from acts or omissions up to the settlement date and "particularly" those incidents during construction season 2008–2009.
- After settling with SDDOT, Aggregate sued Swan for breach of contract and negligence based on Swan’s pre‑settlement testing; Swan moved for summary judgment arguing the SDDOT release barred Aggregate’s claims.
- The circuit court granted summary judgment for Swan; the South Dakota Supreme Court affirmed, holding the release covered Aggregate’s claims against Swan.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the SDDOT release bars Aggregate's claims against Swan | Swan's alleged misconduct occurred in Jan. 2008, before "construction season 2008–2009," so the release (limited to incidents during that season) does not cover Swan | The release broadly covers "any act, occurrence or omission up to the present time" and releases "all others directly or indirectly liable," so it bars claims against Swan | Release is broad and covers acts occurring up to execution date; Swan's testing in Dec. 2007/Jan. 2008 is within the release, so claims barred |
| Whether the release can bar contract claims as well as tort claims | Release cannot as a matter of law release contract claims against third parties | Release language "any and all claims ... and causes of action" releases contract claims against "all others directly or indirectly liable" | The release language is sufficiently broad to release contract claims; summary judgment on contract claim affirmed |
Key Cases Cited
- Bowes Constr., Inc. v. S.D. Dep’t of Transp., 793 N.W.2d 36 (S.D. 2010) (discusses sodium‑sulfate soundness testing procedure and purpose)
- Nelson v. Schellpfeffer, 656 N.W.2d 740 (S.D. 2003) (contract interpretation prefers meanings that give effect to all terms)
- Arch v. Mid‑Dakota Rural Water Sys., 759 N.W.2d 280 (S.D. 2008) (summary judgment standard and appellate review)
- A‑G‑E Corp. v. State, 719 N.W.2d 780 (S.D. 2006) (interpretation of contract is a question of law reviewed de novo)