Commonwealth Court has struck down a charter-school enrollment cap in Delaware County's struggling Chester Upland School District, where charters already make up more than half the kindergarten-to-eighth-grade enrollment.

Unless the ruling, handed down Friday, is overturned, charters in the Chester Upland district will be able to expand by at least 1,000 more children under resolutions passed in 2006 by a Republican-dominated oversight board appointed by the state and the county courts.

Those resolutions were canceled and rewritten last year by a superseding oversight panel, the Chester Upland Empowerment Board, appointed by Gov. Rendell.

The district now has 2,720 charter students and 4,022 regular school students.

Steven Lee, the CEO of the Chester Community Charter School, the district's largest charter, said in a statement yesterday: "This is a great legal victory for the students and parents of the city of Chester. Now, families in the Chester community are assured of having the increased choice of educational options that was intended for them and their children under the law."

C. Marc Woolley, chairman of the new empowerment board, said yesterday that the ruling threatens the district's future and promised an appeal.

If the ruling stands, he said, "it would lead to the reduction of services on the public school side, so much so that the viability of the district would be in question."

Last April, the empowerment board - which oversees the district in place of a regular school board because of its poor academic performance and precarious financial condition - passed a resolution capping the total number of charter school students in the district at 2,573; later another 150 were added to that number.

The three existing charter schools now make up 56 percent of the K-8 district enrollment and about 40 percent of total district enrollment.

The empowerment board said when it passed the resolution that the Pennsylvania law authorizing state empowerment boards to operate distressed school districts gives them the right to cancel or modify any contracts districts have signed, other than teachers' contracts. Charters, it said, should be regarded as contracts under that law and so could be canceled or changed.

The board, appointed in March 2007 by Gov. Rendell to replace the Republican-dominated panel, sought to cancel a series of resolutions passed in 2006 by its GOP-controlled predecessor that had allowed two charters to expand and created a third.

The 2006 agreement gave the Chester Community Charter, which now has 2,124 Chester Upland students in its schools, the ability to expand to at least 3,000 students by 2011. It also gave the newly created Widener Partnership Charter school, which now has 146 students, the right to grow to 300 children. The third charter school, the 450-student Village Charter, is unaffected by the ruling, Woolley said; it is slated to close in June because it failed to meet performance benchmarks set by the district.

In response to the imposition in April of the charter-school cap, a Chester Community Charter School parent sued in Delaware County Court, which ruled that the cap was illegal; the school district and empowerment board appealed.

In the 5-1 Commonwealth Court ruling released last week, Judge Dante R. Pellegrini wrote that charter schools do not have a contractual relationship with school districts, so the board could not change the terms of the charters the earlier board had granted.

He wrote: "the relationship between a school district and a charter school is not contractual, but regulatory. . . . It is more like the issuance of a regulatory permit where the state or local government must honor the terms of the permit unless breached by the party receiving the permit."

Contact staff writer Dan Hardy at 610-701-7638 or dhardy@phillynews.com.