South Dakota Partnership Agreement

South Dakota partnership agreements keep partners consistent with their status and duties. Furthermore, they clearly spell out when, how, and which partner is liable for a partnership’s obligations.

Last updated February 14th, 2025

South Dakota partnership agreements keep partners consistent with their status and duties. Furthermore, they clearly spell out when, how, and which partner is liable for a partnership’s obligations.

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South Dakota Partnership Types (4)

Partnership Type State Filing Requirement
General Partnership (GP) South Dakota Business Name Availability Search (No filing requirement, but names must comply with state naming requirements)
Limited Partnership (LP) Certificate of Limited Partnership(Filing Fee: $125.00)
Application for Registration of Foreign Limited Partnership (Filing Fee: $125.00)
Limited Liability Partnership (LLP) Statement of Qualification Domestic Limited Liability Partnership (Filing Fee: 125.00)
Foreign Limited Liability Partnership (Filing Fee $125.00)
Limited Liability Limited Partnership (LLLP)
Certificate of Limited Partnership (Filing Fee: $125.00)
Application For Registration For Limited Partnership (Filing Fee: $125.00)

Fiduciary Duty

Duty of Loyalty:

  • Partners have the obligation to report on the profits, properties, as well as benefits they received as a direct or indirect result of the “conduct and winding up of the partnership” or their access to the partnership’s property, assets, or resources. [1]
  • Partners do not deal with their partnership as a party holding any “interest adverse” to the partnership; additionally, partners cannot represent any person or party with any goals or interests against the partnership’s success. [2]
  • Partners are explicitly restricted by law from competing with the partnership business “before the dissolution of the partnership.”[3]

Duty of Care:

  • The partners maintain their own conduct and thus have the obligation to remain lawful and avoid any kind of misconduct (i.e., “reckless,” ”negligent,” or “intentional”). [4]

The partnership agreement, as well as the South Dakota partnership laws, require partners to “discharge their duties to the partnership” strictly with good faith and fairness. [5]

Partners retain the right to an action that “furthers the partner’s own interest” but hold the obligation to remain compliant with South Dakota partnership laws. [6]

Liability

General partners are normally responsible “for all obligations” their partnership must meet accordingly. [7]
Partners that enter “an existing partnership” do not hold liability for the obligations that originate before their admittance date since their obligations begin for liability occurring after their admittance. [8]
A limited liability partnership acts as a buffer for the partners and protects them from being personally responsible for LLP obligations, such as those “arising in contract,” simply because they are partners in that business. [9]
Partnerships hold liability “for loss or injury” they cause to third parties, but penalties are adjustable through any allowances available by law or remedies a claimant agrees to.[10]
Partnerships are liable for “money or property” that is received through the course of business but is misapplied by a partner. [11]

State Definitions (7)

Partnership means a business that is both for-profit and co-owned by at least two persons (i.e., legal entity) and operates in compliance with South Dakota law. [12]
General partner is a “person” that is a legal entity in South Dakota and a partner in a limited partnership holding the control (such as management decisions) over a partnership’s dealings since the partnership agreement and the certificate of limited partnership grants such power. [13]
Limited partner is a person that is defined as such “in accordance with the partnership agreement” and, therefore, has the same restrictions and protections defined by South Dakota law for this role. [14]
Limited partnership is a co-owned business that is for profit and has “one or more limited partners” in addition to at least one general partner. [15]
Limited liability partnership means a partnership has an active and approved statement of qualification without “a similar statement in effect” outside of South Dakota’s jurisdiction. [16]
Foreign limited liability partnership means a partnership is operating legally “under laws” that are another state’s or country’s as well as maintaining the “limited liability partnership” status as per the foreign jurisdiction. [17]
Foreign limited partnership means a partnership that is actively operating through the laws of “any state” or country “other than South Dakota” but must have one or more general and one or more limited partners to remain in compliance with the foreign jurisdiction’s laws. [18]