## Facts

- In 1941 and 1950, Baldwin Locomotive Works conveyed two parcels to a public authority by deeds granting a fee simple subject to a covenant requiring the land be kept available for and used only for public purposes while owned by the authority or its successors.
- Each deed included a clause providing that if the public use was abandoned so the land ceased to be used for public purposes, the grantor and its successors/assigns would have the right to “repurchase, retake and reacquire” the land upon payment of the original consideration.
- The authority used the parcels for a sewage treatment plant, a public use, but later ceased operations and stopped using the property for the specified public purpose.
- After the cessation of public use, the authority brought an action to quiet title, asserting the repurchase provision was an option exercisable “at any time hereafter” and therefore void under the common-law rule against perpetuities.

## Issues

1. Whether the deed language created a presently vested reversionary interest (e.g., possibility of reverter/right of entry) or an option to purchase triggered by cessation of public use.
2. If it created an option, whether the option was void under the rule against perpetuities because it could be exercised beyond the perpetuities period.
3. Whether a “public benefit” rationale could save an otherwise void option from invalidation under the rule against perpetuities.

## Decision

- The Supreme Court of Pennsylvania held the repurchase clause created an option to purchase, not a vested reversionary interest.
- The Court held an option to purchase land is unenforceable if it may be exercised beyond the rule against perpetuities period, and this option—exercisable “at any time hereafter”—was void at creation.
- The Court rejected enforcing the option based on its asserted public benefits and declined to recognize a public-purpose exception to the rule against perpetuities for such repurchase options.
- The Court reversed the intermediate appellate court to the extent it upheld the repurchase option, thereby removing that option as a cloud on the authority’s title.

## Legal Principles

- A deed provision requiring affirmative action and payment to “repurchase, retake and reacquire” upon a triggering event is construed as an option to purchase rather than an automatic reversionary interest.
- Options to purchase land are subject to the common-law rule against perpetuities and are void if they might be exercised outside the perpetuities period, regardless of whether they are in fact exercised earlier.
- Property law favors free alienability; ambiguous deed restrictions are construed in a manner consistent with perpetuities limits rather than allowing indefinite restraints.
- Clauses framed to serve public purposes do not, without a recognized doctrinal basis, escape the temporal limits imposed by the rule against perpetuities.

## Conclusion

The court invalidated an indefinite deed repurchase right as a perpetuities-barred option, holding that public-purpose motivations do not exempt long-term repurchase options from the rule against perpetuities and clearing the authority’s title of the repurchase provision.


Central Del. Cnty. Auth. v. Greyhound Corp., 527 Pa. 47, 588 A.2d 485 (Pa. 1991)