dissenting.
I dissent from the majority opinion because I do not agree that the preemptive right held by the Village Council of Pinehurst is subject to the rule against perpetuities. By strictly applying the rule to the preemptive right at issue in this case, the majority ignores the purpose and policy underlying the rule as well as the unsuitability of the rule to the transaction at issue here.
Concerned with the ability of royalty and landed gentry to control indefinitely the disposition of their real and personal property, the courts of England first began prohibiting long-term inalienability of property. The early English cases gave rise to the common law rule against perpetuities recognized by the majority *732of American jurisdictions, including North Carolina. The underlying and fundamental purpose of the common law rule against perpetuities is the protection of society by allowing full utilization of land. As commonly noted, “[t]he rule [against perpetuities] evolved to prevent . . . property from being fettered with future interests so remote that the alienability of the land and its marketability would be impaired, preventing its full utilization for the benefit of society at large as well as of its current owners.” Anderson v. 50 E. 72nd St. Condominium, 119 A.D.2d 73, 76, 505 N.Y.S.2d 101, 103 (1986), appeal dismissed, 69 N.Y.2d 743, 504 N.E.2d 700, 512 N.Y.S.2d 1032 (1987).
Although sound in its general prohibition of long-term inalienability of property, the rule against perpetuities is probably the most widely criticized principle of common law. The rule has been characterized as a labyrinth, see Jesse Dukeminier, A Modem Guide to Perpetuities, 74 Cal. L. Rev. 1867, 1867-68 (1986), inflexible, unduly harsh, and a trap for the unwary. W. Barton Leach, Perpetuities in Perspective: Ending the Rule’s Reign of Terror, 65 Harv. L. Rev. 721, 721-24 (1952). Some have suggested that the rule, once beneficial, has outlived the reasons for its origins. See Anderson, 119 A.D.2d at 78, 505 N.Y.S.2d at 104 (comparing property ownership of “the postfeudal agrarian period in which the then progressive Rule Against Perpetuities had its genesis” with “the realities of contemporary commerce and economics” involved in the “recent emergence and widespread use of new and creative ownership arrangements of property”); W. Barton Leach, Perpetuities: New Absurdity, Judicial and Statutory Correctives, 73 Harv. L. Rev. 1318 (1960).
In comparatively recent years, courts have -created a myriad of exceptions in an attempt to avoid the harshness of the rule’s invalidation in toto of contingent future interests that may not vest within the period prescribed by the rule. Thus, courts have exempted from the rule rights of re-entry, possibilities of reverter, resulting trusts, and covenants running with the land. Wong v. DiGrazia, 60 Cal. 2d 525, 536 n.19, 386 P.2d 817, 825 n.19, 35 Cal. Rptr. 241, 249 n.19 (1963) (en banc); 61 Am. Jur. 2d Perpetuities § 28 (1981); 6 Lewis M. Simes & Allan F. Smith, The Law of Future Interests § 1201, at 88 (2d ed. 1956); W. Barton Leach, Perpetuities in a Nutshell, 51 Harv. L. Rev. 638, 647-48 (1938). Courts have also engrafted as exceptions to the applicability of *733the rule property transferred from one charity to another,1 perpetual renewal options in leases, and commercial agreements. 50 Am. Jur. 2d Landlord and Tenant § 1169 (1970) (perpetual renewal options); Verner F. Chaffin, The Rule Against Perpetuities As Applied to Georgia Wills and Trusts: A Survey and Suggestions for Reform, 16 Ga. L. Rev. 235, 293-98 (1982) [hereinafter Chaffin] (charitable gifts); see, e.g., Singer Co. v. Makad, Inc., 213 Kan. 725, 518 P.2d 493 (1974) (commercial lease).2
The most notable exceptions, however, concern the validity of preemptive rights, also called, inter alia, rights or options of first refusal. Despite the general recognition that the rule against perpetuities applies to contingent future interests in personal as well as real property, courts have uniformly upheld as valid and enforceable perpetual corporate charters, bylaws, or shareholders’ agreements requiring shareholders desirous of selling their stock to afford the corporation, the other shareholders, or both the first right to purchase the stock. See generally J.P. Ludington, Annotation, Validity of Restrictions on Alienation or Transfer of Corporate Stock, 61 A.L.R.2d 1318 (1958). In addition, courts of various jurisdictions have in a number of different ways avoided applying the rule against perpetuities to preemptive rights to purchase both real and personal property.
In Weber v. Texas Co., 83 F.2d 807 (5th Cir.), cert. denied, 299 U.S. 561, 81 L. Ed. 413 (1936), the Fifth Circuit Court of Appeals was confronted with determining the validity of a lease provision that granted to the lessee a preemptive right virtually unlimited in duration. Upholding this preemptive right, the Fifth Circuit reasoned:
*734The rule against perpetuities springs from considerations of public policy. The underlying reason for and purpose of the rule is to avoid fettering real property with future interests dependent upon contingencies unduly remote which isolate the property and exclude it from commerce and development for long periods of time, thus working an indirect restraint upon alienation, which is regarded at common law as a public evil.
The option [of first refusal] under consideration is within neither the purpose of nor the reason for the rule. ... It amounts to no more than a continuing and preferred right to buy at the market price whenever the lessor desires to sell. This does not restrain free alienation by the lessor. He may sell at any time, but must afford the lessee the prior right to buy. The lessee cannot prevent a sale. His sole right is to accept or reject as a preferred purchaser when the lessor is ready to sell. The option is therefore not objectionable as a perpetuity.
Id. at 808 (citations omitted).
Since Weber, several courts have followed the Fifth Circuit’s reasoning and have concluded that preemptive rights to purchase property are not subject to invalidation by the rule against perpetuities. See Cambridge Co. v. East Slope Inv. Corp., 700 P.2d 537 (Colo. 1985) (en banc); Shiver v. Benton, 251 Ga. 284, 304 S.E.2d 903 (1983); Barnhart v. McKinney, 235 Kan. 511, 682 P.2d 112 (1984); Terrell v. Messenger, 428 So. 2d 1241 (La. Ct. App. 1983); Anderson v. 50 E. 72nd St. Condominium, 119 A.D.2d 73, 505 N.Y.S.2d 101; Producers Oil Co. v. Gore, 610 P.2d 772 (Okla. 1980); Forderhause v. Cherokee Water Co., 623 S.W.2d 435 (Tex. Civ. App. 1981), rev’d on other grounds, 641 S.W.2d 522 (Tex. 1982); Robroy Land Co. v. Prather, 95 Wash. 2d 66, 622 P.2d 367 (1980) (en banc); cf. Brooks v. Terteling, 107 Idaho 262, 688 P.2d 1167 (1984) (upholding preemptive right as not unconscionable); Hartnett v. Jones, 629 P.2d 1357 (Wyo. 1981) (reciting its approval of Weber but concluding that a state statute made certain that the preemptive right at issue would vest within the period prescribed by the rule).
Some courts have applied the Weber analysis in part and have concluded that the rule against perpetuities does not apply to preemptive rights acquired in commercial or governmental transactions. See Metropolitan Transp. Auth. v. Bruken Realty Corp., 67 N.Y.2d 156, 492 N.E.2d 379, 501 N.Y.S.2d 306 (1986); Southern Pennsylvania *735Transp. Auth. v. Philadelphia Transp. Co., 426 Pa. 377, 233 A.2d 15 (1967), cert. denied, 390 U.S. 1011, 20 L. Ed. 2d 161 (1968); accord Joseph Schonthal Co. v. Sylvania, 60 Ohio App. 407, 415, 21 N.E.2d 1008, 1012 (1938) (“Certainly no rule against perpetuities could ever be intended to apply to municipal corporations.”).
Still other courts have developed other methods to avoid applying the rule against perpetuities to preemptive rights. See Greenshields v. Warren Petroleum Corp., 248 F.2d 61 (10th Cir.) (preemptive right creates a vested interest that is not subject to the rule against perpetuities), cert. denied, 355 U.S. 907, 2 L. Ed. 2d 262 (1957); Dozier v. Troy Drive-In-Theaters, Inc., 265 Ala. 93, 89 So. 2d 537 (1956) (preemptive right creates an estate on a condition subsequent to which the rule against perpetuities does not apply); Weitzmann v. Weitzmann, 87 Ind. App. 236, 161 N.E. 385 (1928) (construing preemptive right as a personal right not subject to the rule against perpetuities); Windiate v. Leland, 246 Mich. 659, 225 N.W. 620 (1929) (preemptive right creates no interest in land and is therefore not subject to the rule); Kershner v. Hurlburt, 277 S.W.2d 619 (Mo. 1955) (preemptive right is a personal right not subject to the rule against perpetuities); cf. Keogh v. Peck, 316 Ill. 318, 147 N.E. 266 (1925) (concluding that an option creates no interest in land).
I agree with the majority of other jurisdictions that have concluded that the rule against perpetuities should not be strictly applied against all preemptive rights. As we noted in Smith v. Mitchell, 301 N.C. 58, 269 S.E.2d 608 (1980):
[The common law prohibition of restraints on alienation] has always conflicted with another common law tenet that one who has property should be able to convey it subject to whatever condition he or she may desire to impose on the conveyance.
Faced with this tension, the law has evolved in such a way that . . . restraints on alienation are premissible [sic] where the goal justifies the limit on the freedom to alienate or where the interference with alienation in a particular case is so negligible that the major policies furthered by freedom of alienation are not materially hampered.
Id. at 62, 269 S.E.2d at 611 (emphasis added) (citations omitted).
Applying the above-described principles enunciated in Smith, it becomes clear that the rule against perpetuities should not be *736applied to the preemptive right at issue in this case. As we have previously stated, “the preemptive right is a useful tool for creating planned and orderly development.” Id. at 63, 269 S.E.2d at 612.
[A]ny interference of a preemptive right with freedom of alienation is so negligible that the major policies of utilization of wealth and economy of land control are not hampered. . . . [T]he minimal interference with alienability presented by a preemptive right does little violence to the primary reason for prohibiting restraints on alienation ....
Id. at 62-63, 269 S.E.2d at 611 (citations omitted). Where, as here, the preemptive right is held by a municipality, I submit that the policies favoring validity of the preemptive right clearly outweigh the minimal restraint imposed.
The purpose of the preemptive right at issue in this case provides additional justification for upholding it as valid and enforceable. As indicated in the majority opinion, the consent judgment entered into by the Village of Pinehurst and Pinehurst, Inc. granted to the Village Council of Pinehurst the right to purchase on behalf of its residents the - sewer and water systems owned by Pinehurst, Inc. in the event that Pinehurst, Inc. decided to sell such systems. As recognized by N.C.G.S. § 160A-311, sewer and water systems are public enterprises. N.C.G.S. § 160A-311 (1987). The operation of such facilities by a municipality, like the Village of Pinehurst, provides a service to the public and presents important considerations of public concern and welfare. Applying the rule against perpetuities to the preemptive right at issue here defeats the policies underlying the rule because it invalidates an agreement, bargained for at arm’s length, which promotes the public’s interest in acquiring services necessary for the public health, safety, and welfare. See Anderson, 119 A.D.2d at 76, 505 N.Y.S.2d at 103 (stating that the purpose of the rule against perpetuities was for the benefit of society at large).
Without recognition of the purpose and policy underlying the rule against perpetuities, the majority today declares that our previous decision in Smith requires that the Court apply the rule against perpetuities to the preemptive right at issue here. However, a careful reading of Smith demonstrates that such is not the case. In Smith, we recognized the harm to be caused by blindly applying rules prohibiting restraints on alienation. Refusing to declare preemptive rights as invalid per se, we undertook an analysis of the pur*737poses for the common law prohibition of restraints on alienation and the goals justifying restrictions on alienation. In our analysis, we considered the degree that alienation was hindered by the preemptive right, the analogous character of preemptive rights to other restrictive devices upheld by the courts of our State, the nature of the transaction in which the preemptive right was acquired, as well as the necessity for such restrictive devices. After balancing these factors, we concluded that preemptive rights are valid as long as they do not amount to unreasonable restraints on alienation. Although in dicta we indicated that a preemptive right is valid only if its duration is limited to a period within the rule against perpetuities, we were not faced in Smith with the type of preemptive right involved in this case. Where, as here, we are confronted with a municipality’s right to purchase all or a major portion of a business’s assets for the purpose of serving the public’s interest, there are additional factors that must be considered in determining the reasonableness of the preemptive right. Having considered all of the factors justifying the preemptive right in this case and having weighed them in light of the policies we enunciated in Smith, I conclude that the preemptive right in this case should be exempt from the rule against perpetuities.
Moreover, I cannot agree with the majority’s conclusion that N.C.G.S. § 36A-49 does not exempt the preemptive right held by the Village Council of Pinehurst from application of the rule against perpetuities. N.C.G.S. § 36A-49 provides that “[n]o gift, grant, bequest or devise ... to religious, educational, charitable or benevolent uses . . . shall be invalid ... by reason of the same in contravening any statute or rule against perpetuities.” N.C.G.S. § 36A-49 (1991). In this case, Pinehurst, Inc. granted to the Village Council the right to purchase its sewer and water systems for the benefit of the residents of the Village of Pinehurst. According to Chapter 160A of the North Carolina General Statutes, municipally owned sewer and water systems are public enterprises, the operation of which provides a service to the public. See N.C.G.S. §§ 160A-311, -312 (1987). In my opinion, the grant of this preemptive right was to a benevolent use within the meaning of N.C.G.S. § 36A-49 and is therefore exempt from the rule against perpetuities. The mere fact that the Village could operate the sewer and water systems for profit does not change that outcome.
I do not agree with the majority that the preemptive right held by the Village Council of Pinehurst is invalid as violative *738of the rule against perpetuities. Having reviewed the terms of the preemptive right, I conclude that the preemptive right here is in all respects a reasonable restraint on alienation. Therefore, I dissent from the majority opinion and vote to reverse the Court of Appeals and remand this case to that court for further remand to the Superior Court, Moore County, for further proceedings.
Chief Justice EXUM joins in this dissenting opinion.. N.C.G.S. § 36A-49 provides an even broader exception than that recognized by most jurisdictions and North Carolina cases decided prior to the effective date of the statute. Under the statute, the rule against perpetuities does not invalidate any “gift, grant, bequest or devise ... to religious, educational, charitable or benevolent uses,” irrespective of the transferor’s and transferee’s status as charitable entities. N.C.G.S. § 36A-49 (1991).
. In addition, some states have ameliorated the harshness of the rule against perpetuities by adopting a wait-and-see approach, thereby invalidating only those contingent future interests that actually fail to vest within the period prescribed by the rule. See Merchants Nat'l Bank v. Curtis, 98 N.H. 225, 97 A.2d 207 (1953) (judicial adoption of wait-and-see); Chaffin, 16 Ga. L. Rev. at 346 (discussing the differences between the wait-and-see statutes enacted by ten states).
A few states have also extended the cy pres doctrine to “mitigate the destructive impact of the Rule Against Perpetuities.” Chaffin, 16 Ga. L. Rev. at 350.