On The Transfer-intended-to-grant-a-favor And The Right Of Preemption Of The Lessee

The right of preemption of the lessee is a privilege granted to the lessee by the law, which ensures that the lessee has the right of first refusal under the same conditions where the lessor is to transfer the premises under a lease within the lease term. But both in the legislation and in the theory, there is no specific definition for the term"transfer", which is the precondition for the lessee to exert the preemption right. This spells debates in the judicial practices over whether the lessee could exert the said preemption right in the event that the lessor transfers the premises under a lease to a particular transferee not only for acquiring the equivalent money consideration, but intendedly to have the transferee benefit from such a transfer.This article, on the basis of analyzing the legal system of the transfer-intended-to-grant-a-favor as well as the legal system of the preemption right of the lessee, defines the characteristics and the choices of the applicable rules as to the transfer-intended-to-grant-a-favor, and then carries out a rationality anatomy over the nature and applying conditions of the preemption right. Along with the foregoing efforts, the article further draws a comparison among the three contract categories of the sales, the barter and the bestowal in terms of whether the preemption right applies under respective contractual conditions, and through which abstracts the general rules as to the applying of the preemption right of the lessee. Then the article moves on to demonstrate whether the lessee should be entitled to the preemption where the lessor transfers the premises under a lease with intent to benefit the transferee, for the purpose to strike a balance over the equal protection of the interests among the lessor, the lessee and the third party.The first part of the article primarily elucidates the transfer-intended-to-grant-a-favor as a legal act. At first, starting with the cases in the introduction, it defines the particular transfers occurring in the cases as mixed bestowal. Then, from the judging tests and the substantive connotation of the mixed bestowal, it generalizes the upstream category of which—a special legal act—the transfer-intended-to-grant-a-favor, which, meanwhile, is limited to two classifications: the mixed bestowal and the transfer occurring between relatives, considering the state of the third party's interests and necessity to protect such interests . At last, it analyzes the applicable rules of the transfer-intended-to-grant-a-favor in combination with the characteristics of the subject matter subject to the preemption right of the lessee.The second part is designed mainly to explore the legislation value, the nature and the applicable conditions of the preemption right of the lessee. Taking into account its value and referring to the legislation and academic researches, this article defines the preemption right of the lessee as a right of formation as well as a right in personam,the consequence of the exertion of which would be: a purchase and sale contract comes into formation between the lessor and the lessee, by which the lessor is bound whereas the lessee's interests are protected. Also in this part it is pointed out that in the common transactions of purchase and sale, the preemption right rule, which consists in its obligatory nature, the nature of right of formation and the same conditions, is put in to balance the protection of the respective interests of the third party, the lessor and the lessee, whereas in the transfer-intended-to-grant-a-favor, such a balance would be turned over.The third part, on the basis of the first two parts which respectively analyze the transfer-intended-to-grant-a-favor and the right of preemption of the lessee, separately explains the characteristics of the sale, the barter and the bestowal as well as the reason whether the right of preemption should be applied with their respective characteristics, thus generalizes a universal rule as to the applying of the preemption right, namely, not impeding the realization of the original purpose of the lease contract, which is further argued from a comparative law perspective. Going on the premise of the standing of it, this part employs this universal rule in analyzing the transfer-intended-to-grant-a-favor and draws a conclusion that the preemption right of the lessee should not be applied wherein, which is also reinforced by the existing legislative ideas and judgments of the courts.In the process of the argumentation, this work also takes on an approach of comparative research, not only comparing the legislations of different countries and areas in terms of rationality, but drawing the significances of the advanced foreign theories. Meanwhile, as for the methodology, not only the theoretical study is stressed, but also a great importance is attached to the status quo and experiences of the judicial practices, in an effort to reach a correct conclusion on the basis of the thorough analysis.