902 N.W.2d 778
S.D.2017Background
- Sioux Falls entered a confidential settlement with the general contractor and four subcontractors over exterior siding defects at the Denny Sanford Premier Center; the agreement included a confidentiality clause but did not result from litigation.
- The City posted that a global settlement had been reached; an Argus Leader reporter requested a copy, and the City refused citing SDCL 1-27-1.5(20) and the contract’s confidentiality provision.
- Argus Leader sued under SDCL 1-27-38 seeking a court order requiring production of the settlement as a public record; both parties moved for summary judgment.
- The circuit court granted the City’s motion, holding the settlement was not subject to public inspection under SDCL 1-27-1.5(20).
- The South Dakota Supreme Court reversed, holding the statutory exception’s modifier (“of the parties to any civil or criminal action or proceeding”) applies to “contract” and “stipulation,” so a non‑litigation confidentiality contract does not exempt the document from disclosure.
Issues
| Issue | Argus Leader's Argument | City of Sioux Falls' Argument | Held |
|---|---|---|---|
| Whether SDCL 1-27-1.5(20) exempts a settlement agreement from disclosure when the contract itself declares confidentiality but no litigation was commenced | The modifier limits the exception to documents made confidential by parties in civil/criminal proceedings; because no suit was filed, the settlement is a public record | The statute’s trailing modifier applies only to the last antecedent (stipulation); a contract that declares confidentiality is thus excepted | Court held the modifier applies to both “contract” and “stipulation”; because parties were not in a civil/criminal proceeding, the settlement is a public record and must be disclosed |
| Whether the Public Records Act’s presumption of openness and liberal‑construction directive require a narrow reading of the exception | The Act’s presumption of openness and SDCL 1-27-1.3 require construing exceptions narrowly to avoid allowing government to contract around disclosure | The written punctuation and last‑antecedent canon support reading the modifier as limited to “stipulation” without regard to the Act’s broader purpose | Court relied on contextual/whole‑text canons and the presumption of openness to narrowly construe the exception in favor of disclosure |
| Whether other, more specific municipal record statutes (SDCL 9‑14‑17, 9‑14‑21, 9‑18‑2) displace the Public Records Act here | These statutes govern municipal records and inspection and do not override the Public Records Act’s broader disclosure requirements | City argued those municipal statutes did not require disclosure of the contract | Court found no conflict with its reading of SDCL 1‑27‑1.5 and did not need to resolve whether those municipal statutes independently required production |
| Whether anticipated litigation or pre‑suit enforcement efforts transform a private confidentiality contract into an exception under SDCL 1‑27‑1.5(20) | Anticipated litigation should not qualify; the statutory phrase requires parties to be part of an actual civil/criminal action/proceeding | City argued readiness to litigate and pre‑suit enforcement efforts justify treating the contract as within the exception | Court held the statute contemplates confidentiality tied to actual civil/criminal proceedings, not anticipated litigation; pre‑suit negotiations do not bring the contract within the exception |
Key Cases Cited
- Heitmann v. American Family Mutual Insurance Co., 883 N.W.2d 506 (S.D. 2016) (standard of review for summary judgment and no genuine issue of material fact)
- Mercer v. South Dakota Attorney General’s Office, 864 N.W.2d 299 (S.D. 2015) (Public Records Act presumption of openness explained)
- Hoglund v. Dakota Fire Insurance Co., 742 N.W.2d 853 (S.D. 2007) (application of the rule of the last antecedent)
- Hayes v. Rosenbaum Signs & Outdoor Advertising, Inc., 853 N.W.2d 878 (S.D. 2014) (avoidance of absurd or unreasonable statutory interpretations)
- Martinmaas v. Engelmann, 612 N.W.2d 600 (S.D. 2000) (courts must follow statutory text even if different from what they think best)
- In re Marvin M. Schwan Charitable Foundation, 880 N.W.2d 88 (S.D. 2016) (limits on judicial amendment of statutory text)