This сase involves the question of whether a contract for the sale of land, under which title may not be transferred until an indefinite date, is enforceable. Because the buyer’s interest may vest too remotely, we hold that the contract in the case at bar violates the Rule Against Perpetuities.
On June 23,1981, Dorado Limited Partnership and Brоad-neck Development Company entered into a contract to sell real property located in Anne Arundel County. Under the contract Broadneck agreed to sell 70 lots to Dorado for $280,000. In addition, Broadneck granted Dorado an option to purchase an additional 252 lots. The option on the first 126 lots remаined open until one year after settlement on the original 70 lots. The option on the final 126 lots remained open for an additional year.
Settlement was reached on the original 70 lots on May 12, 1983. On February 16, 1984, the parties amended the contract. This amended agreement provided, inter alia, that the option on the additional 252 lots wоuld expire unless Dorado exercised its option on at least 120 lots by April 15. On April 13, 1984, the parties settled on an additional 140 lots. On April 16, 1984, they amended the contract for the second time. This second amendment, which is the subject of the present litigation, provided in its relevant part as follows:
“1. Buyer agrees to purchase and settle оn all remaining lots covered by the Contract of Sale by payment of the purchase price in cash not later than ninety (90) days after the Seller has delivered to Buyer evidence of sewer allocations for such lots. Time is of the essence of all the provisions of the Contract of Sale.”
In essence, this second amendment was a contract for the sale of the remaining 112 lots. The actual purchase of these units, however, would not occur until after Broadneck obtained a sewer allocation.
*151 As a result of a county moratorium on sewer allocations, Broadneck has been unable to procure the sewer allocation, and thus the sale has never been consummated. Finally, Broadneck brought this declaratory judgment action in the Circuit Court for Anne Arundel County seeking an adjudication of the rights and obligations of the parties, a declaration that the contract for the sale of the remaining 112 lots was void, and any other appropriate rеlief. Broadneck relied on three alternate theories why the contract was void. Each theory is premised on the fact that the settlement date could be extended indefinitely because it is uncertain when sewer service will be allocated. Broadneck asserted that the contract was unenforceable bеcause it: (1) violates the Rule Against Perpetuities; (2) imposes an unreasonable restraint on alienation; or (3) is vague and uncertain.
The circuit court rejected each of Broadneck’s contentions and held that the contract “remains in full force and effect and is binding upon the parties.” Broadneck appealed to the Court of Special Appeals. In the intermediate appellate court, Broadneck made the same three arguments which it had made in circuit court. The Court of Special Appeals, in an unreported opinion, reversed, holding that the contract was void as an unreasonable restraint on alienation. The intermediate appellant court did not reach either of Broad-neck’s other two assertions.
Thereafter, Dorado petitioned this Court for a writ of certiorari, raising the issue of whether the contract violated the rule against unreasonable restraints on alienation. Broadneck filed a conditionаl cross-petition for a writ of certiorari, raising the other two arguments which Broadneck had advanced below. We granted both the petition and the cross-petition.
In our view, the contract for the sale of the remaining 112 lots violates the Rule Against Perpetuities. Consequently, we do not reach the issues of whether the contrаct is an unreasonable restraint on alienation or is fatally vague. We shall affirm.
*152
Except for a few statutory modifications,
1
Maryland retains the common law Rule Against Perpetuities.
Ferrero Constr. v. Dennis Rourke Corp.,
As a formulation of the Rule Against Perpetuities, our cases have adopted Professor Gray’s statement that “[n]o interest is good unless it must vest, if at all, not later than twenty-one years after some life in being at the creation of the interest.”
Fitzpatrick v. Mer.-Safe, Etc. Co.,
“The term ‘vested’ as used in the law of property, signifiеs that there has been the fixation of a present right to either the immediate or future enjoyment of property. Curtis v. Maryland Baptist Union Ass’n,176 Md. 430 , 438, 439,5 A.2d 836 ,121 A.L.R. 1516 . The term *153 ‘vested’ has also another meaning, which is so frequently given to it that it cannot be styled improper. This other meaning is ‘transmissible.’ As Professor Gray of Harvard has said, ‘Such double meaning is, however, very unfortunate, as it has led to much сonfusion.’ Gray, Rule Against Perpetuities, 4th Ed., § 118. Vesting in that secondary sense is not sufficient to escape the rule against perpetuities. The interest must vest in the sense of becoming a vested remainder.
“The event, upon the happening of which the remainder is to vest, must be one that is certain to happen within the prescribed period, otherwise the limitation is void.”
The purposes of the rule include the facilitation of alienation of property and maintaining certainty of title.
Ferrero Constr., supra,
Broadneck argues that the contract violates the Rule Against Perpetuities because Dorado’s interest might never fully vest. Broadneck points out that legal title can not vest until there is a sewer allocation. There is no certainty, however, that Broadneck will ever obtain a sewer allocation. Therefore, Broadneck concludes, it is possible that Dorado’s interest will not vest within a life in being and 21 years.
According to Dorado, the Rule Against Perpetuities does not require that legal title must vest, if at all, within the perpetuities period. In Dorado’s view, the proper question is “whether each interest in the land has vested.” Dorado reasons that, under the contract, each interest has vested. On the one hand, it obtained an equitable interest in the property at the signing of the contract. On the other hand, Broadneck retained legal interest or title. In essence, Dora-do maintains that a land sales contract can never violate the Rule Against Perpetuities.
In our view, when the purpose of a contract is to transfer legal title in land, then legal title must vest within the period of the Rule Against Perpetuities. Otherwise, there would be the distinct possibility that a contract would
*154
render title uncertain. After the signing of the contract, the seller retains legal title until the deed is properly executed and delivered.
Childs v. Ragonese,
Consequently, the purchaser’s immediate acquisition of equitable interest alone is not sufficient to guarantee that the Rule Against Perpetuities has not been transgressed. For a land sales contract to be valid under the Rule, therefore, legal title must vest in the purchaser within a life in being plus 21 years.
The Court expressed the same position in
Commonwealth Realty v. Bowers, supra.
That case presented the issue of whether an option contract violated the Rule Against Perpetuities. Like Dorado, the holder of the option, Commonwealth, arguеd that the option did not violate the Rule because the right to exercise the option is a present vested right. In rejecting Commonwealth’s argument, we pointed out (
“the vesting of the fee simple estate in the land occurs when and if the option is exercised in the future by Commonwealth, notice given and the $18,000 [the purchase price] paid.”
In addition, cases in other jurisdictions contradict Dora-do’s position that a contract for sale of property does not violate the Rule Against Perpetuities on the ground that the purchaser acquired equitable title upon the signing of the contract.
See, e.g., Horticultural Development Co. v. Lark,
In
Comstock v. Smith, supra,
“the monthly payment of $85 was less than the interest upon $18,000 at llk per cent per annum. There was no requirement that the principal debt be paid at any specified time. Consequently the purchasers and their successors in interest might have made payments for scores or even hundreds of years without viоlating their contract or acquiring a right to a conveyance of the property. Thus the alienability of the title might be fettered for a period far beyond that allowed by the rule against perpetuities.”
Even when courts hold that a particular contract for the sale of land does not violate the Rule Against Perpetuities, it is not on the ground that the purchaser received equitable title. The contract at issue in
Ryland Group, Inc. v. Wills, supra,
“The trial judge further stated that while [the purchaser] would acquire an equitable estate in a lot upon exercise of the option to purchase it, legal title would not vest until delivery of the deed at settlement. Since settlement might not occur until development had been completed and the judge concluded that development might be delayed more than 21 years, he was of the oрinion that the contract violated the rule against perpetuities.
“We agree that upon exercise of the option, [the purchaser] would acquire an equitable interest in the lots it committed itself to purchase, with the right to compel conveyance of legal title____ Upon exercise of the op-
tion, the agreement would become an executory contract for the sale of land with mutuality of obligation and remedy. ... Such a contract creates an interest in land enforceable in equity and is therefore subject to the rule against perpetuities____
“We also agree that vesting of legal title is postponed until delivery of thе deed at settlement. We do not agree, however, that vesting of legal title might not occur within the period of the rule against perpetuities.”
The court held that, under the terms of the contract, development would necessarily occur within 21 years. Consequently, settlement and vesting would also take place before 21 yeаrs.
It is immaterial, therefore, whether Dorado has already received equitable title. If legal title might not vest within a life in being and 21 years, then the contract is invalid under the Rule Against Perpetuities. It seems clear, and Dorado does not contend otherwise, that legal title might not vest in Dorado until after the perpetuities period. Settlement is contingent upon a county sewer allocation. It is uncertain when, if ever, Broadneck will obtain the sewer allocation. It is conceivable that it could occur after a life in being plus 21 years.
*157
In
Commonwealth Realty v. Bowers, supra,
we reached the same conclusion with respect to a similar clause in an option contract. In that casе, Commonwealth purchased an option to buy a parcel of land in Washington County. The option contract provided in its relevant part (
“2. This Agreement shall extend for 180 days; or, if the requisite zoning and permits, described in Article 4 hereof have not been finally issued or denied beyond appeal, until 15 days after such final action therеon. Buyer may renew it for an additional period of 180 days from the later of the above dates by paying as consideration therefor, monthly in advance, the sum of $2.00 for each day so renewed.”
Under the terms of the contract, therefore, Commonwealth’s option would remain open until it applied for, and received, zоning approval and permits. This Court concluded (
“violates the Rule in that it may be exercised with a resulting vesting of the fee simple estate long after lives in being (and the period of gestation) as and when the option contract is exercised.”
We recognize that some courts have held that a contract for the sale of land, which did not expressly provide a time for performance, did not violate the Rule Against Perpetuities because the court construed the contract so as to imply a reasonable time for performance and found that a reasonable time would be less than the perpetuities period.
See, e.g., Read v. GHDC, Inc., supra,
In
Ryland Group, Inc. v. Wills, supra,
however, the Supreme Court of Virginia took the position that it would not construe the contract as imposing a requirement of performance within a reasonable time when there was “a contingency to be performed by a party who was not privy to the agreement.”
Somewhat the same view is reflected in Professor Gray’s treatise, supra, § 330 n. 2, where it is stated:
“An agreement for sale is not void because it does not expressly limit the time within which the agreement is to be carried out. The vendee has an equitable interest, subject only to the condition that the price shall be paid, which must be done within a reasonable time, and that would be less than twenty-one years. Re Doyle’s Estate, [1907] 1 I.R. 204. But an agreement which gives the vendee the right to call for a conveyance only on the fulfillment of a condition which may be too remote, is unenforceable in equity.”
We agree with the Supreme Court of Virginia that where the occurrence оf the condition precedent to conveyance is beyond the control of the parties, a reasonable time for performance, less than the perpetuities period, cannot be implied. This position is in accord with our decision in Commonwealth Realty v. Bowers, supra.
In this case, Broadneck has fulfilled its obligation under the contract. It has applied for a sewer allocation. Settlement is dependent, not on performance by Broadneck, *159 but on the action of a third party, Anne Arundel County. Whether Anne Arundel County might grant a sewer allocation for the lots within the perpetuities period is unknown.
We conclude, therefore, that the contract for the sale of the remaining lots is unenforceable because it violates the Rule Against Perpetuities.
JUDGMENT AFFIRMED, WITH COSTS.
Notes
. Maryland Code (1974) § 4-409, § 11-102, § 11-103 of Estate and Trusts Article.