## Facts

- Texaco Refining and Marketing, Inc. entered a recorded commercial lease in 1964 for a service-station property in Southington, Connecticut.
- The lease had a 15-year initial term plus three 5-year renewal options exercisable by Texaco; Texaco exercised two renewals.
- The lease granted Texaco an exclusive option to purchase the premises for $125,000, exercisable at any time during the lease term (including renewals) beginning after the 14th year of the initial term.
- In August 1987, during a renewal term, Texaco notified the then-owners (successors to the original lessor) that it was exercising the purchase option.
- The owners refused to convey the property, and Texaco sued for specific performance.
- The trial court found the option supported by consideration, negotiated at arm’s length, and that Texaco was ready, willing, and able to perform; it ordered specific performance.

## Issues

1. Whether a purchase option in a long-term commercial lease, exercisable only during the lease term (including renewals), is invalid under Conn. Gen. Stat. § 47-33a.
2. Whether such a purchase option is void under the common-law rule against perpetuities.
3. Whether specific performance is an appropriate remedy to enforce the option under the circumstances.

## Decision

- The Connecticut Supreme Court affirmed the judgment ordering specific performance in Texaco’s favor.
- The court held the option did not violate Conn. Gen. Stat. § 47-33a.
- The court held the option did not violate the common-law rule against perpetuities.
- The court adopted the rule that an option to purchase contained in a commercial lease, if exercisable only within the leasehold term, is valid without regard to the rule against perpetuities.

## Legal Principles

- A purchase option contained in a commercial lease, exercisable only during the lease term (including contractual renewals), is enforceable and not void under the rule against perpetuities.
- Conn. Gen. Stat. § 47-33a does not bar enforcement of a purchase option that is incident to and limited by an existing commercial leasehold term.
- Lease-related interests appurtenant to a present leasehold estate and restricted to the lease term are treated differently from free-standing, indefinite future interests for perpetuities purposes.
- Specific performance may be ordered to enforce a real property purchase option when the option is supported by consideration and the option holder is ready, willing, and able to perform, absent an equitable bar.

## Conclusion

The court enforced Texaco’s lease-based purchase option by specific performance, holding that a commercial-lease purchase option confined to the lease term (including renewals) is valid and not void under § 47-33a or the common-law rule against perpetuities.


Texaco Refin. & Mktg., Inc. v. Samowitz, 213 Conn. 676 (1990)