Legal Analysis of the Dimensions of Gradual Transfer of Ownership

Abstract

Ownership that is established through contractual agreements has traditionally been transferred instantaneously and in two distinct manners from one party to the other. The first method is immediate and present transfer (instantaneous and effective), while the second method is immediate yet deferred (the transfer of ownership is designated for a future point in time). In both approaches, the transfer is executed in a single phase and at a specific moment. The distinction between these two methods lies in the timing of the transfer: in the first, ownership is transferred at the moment the contract is concluded, whereas in the second, ownership is transferred after a temporal interval following the conclusion of the agreement. In recent years, a new method of transferring ownership has emerged in legal discourse, referred to as the gradual transfer of ownership. Unlike the traditional methods, this form of transfer does not occur all at once but rather unfolds progressively over the course of the contractual period. As the various phases of the contract are completed, ownership is incrementally transferred from the first party to the second party. A key feature of the gradual transfer of ownership is that it does not require separate offers and acceptances at each stage of the transfer. This is because the basis for the gradual transfer of ownership is established by the parties at the time the contract is concluded. The implicit intention of the parties is that, without the need for renewed offers and acceptances, ownership will be transferred incrementally as obligations are fulfilled by both parties. Two types of contracts exemplify the concept of gradual transfer of ownership: the pre-sale contract and the construction partnership contract. This article aims to first clarify the concept of gradual ownership and second to analyze the legal nature and contractual dimensions of these two types of agreements.