Homophthalic anhydride (HPA) typically reacts rapidly with benzalimines to afford the formal [4+2] adduct, a 1,2,3,4-tetrahydroisoquinolin-1-one-4-carboxylic acid. The stereochemical outcome of this reaction is consistent with an open transition state comprising an iminium species and enolized HPA, leading to a short-lived amino-anhydride intermediate. In the case of N-tert-butylbenzalimine, this Mannich-type intermediate, which would normally cyclize at low temperature to a single isomer of the delta-lactam, is intercepted by base treatment to afford beta-lactam products. A pathway featuring ketene formation followed by ring closure is implicated.