July 27, 2001

Plaintiff Duane J. O'Connor, as special administrator of theestate of Harry C. Emhouser (Harry), filed a complaint againstdefendants St. John United Church of Christ, Otho KaloCongregationalist Church (collectively churches), and Marlo JeanPopp Brais (Brais) seeking a construction of the will to includecertain farmland in the estate. The court ruled that the farmlandwas part of the estate, and Brais appealed. We affirm and holdthat the grantor of a deed in escrow must intend to part with alldominion and control over the deed in order to effectuate deliveryand, thus, secure the deed's validity.

FACTS

On June 19, 1994, Brais filed a petition for the probate ofHarry's will and for the issuance of testamentary letters. Thewill devised to the churches the farmland which is the subject ofthis dispute. Brais filed an inventory in which she included thefarmland as part of the estate. Five months later, for reasonsthat will be discussed, Brais filed an amended inventory wherebyshe requested to exclude the farmland. The churches objected tothe filing of the amended inventory.

O'Connor was appointed as special administrator. He filed acomplaint seeking the inclusion of the farmland in the estate. O'Connor was subsequently replaced by plaintiff Adrienne Albrechtas the special administrator.

The following is a recitation of the parties' jointstipulation of facts. Harry and his wife, Rose Emhouser, jointlyowned the farmland that is the subject of this appeal. On April27, 1987, the Emhousers executed what was termed an "escrow"agreement and a quit claim deed which they delivered to CourthouseTitle Service (Courthouse). The escrow agreement provided that theEmhousers would execute a quit claim deed for the farm, to be heldby Courthouse in favor of Brais, upon the following conditions:

1. The deed would not be recorded by Courthouse.

2. The Emhousers reserved the right to revoke the escrowagreement prior to the death of the survivor of the parties.

3. Courthouse would not deliver the deed to Brais untilboth the Emhousers were deceased.

Rose died in 1988, one year after the execution of theagreement. On July 2, 1990, Harry executed a will in which hebequeathed the farmland to the churches. At no time was any deedexecuted conveying the property to Courthouse as trustee. But aquit-claim deed conveying the property to Brais was delivered toher after Harry's death.

The trial court ruled that the farmland was part of theestate. No order of the court appears in the record. The courtdocket provides that Harry's will was "an effective revocation ofthe trust *** though the will had not become effective until thedate of death of the testator. Therefore, the real property inquestion is an assett [sic] of the estate." Brais appealed thecourt's order.

ANALYSIS

On appeal, Brais argues that the agreement between theEmhousers and Courthouse was actually a valid and binding trust. She argues that Harry's will did not effectively revoke the trustbecause, pursuant to Merchants National Bank v. Weinold, 22 Ill.App. 2d 219, 160 N.E.2d 174 (1959), and In re Estate of Anderson,69 Ill. App. 2d 352, 217 N.E.2d 444 (1966), if a trust does notspecifically state that it is revocable by will, it is onlyrevocable by an inter vivos act. In this case, the agreement didnot provide for its revocation by will; rather, the agreementspecifically provided that it could be revoked only during theEmhousers' lives. Thus, Brais concludes, the court erred when itdetermined that the farmland was part of the estate. We cannotagree.

To create a trust, it is necessary to specify the followingelements: (1) grantor or settlor; (2) trustee; (3) subject-matteror res of the trust; (4) beneficiaries; (5) the nature and qualityof each beneficiary's interest; and (6) the manner and time inwhich the trust is to be performed. Wynekoop v. Wynekoop, 407 Ill.219, 95 N.E.2d 457 (1950). No particular form or words arenecessary to create a trust. A court will assume an intention tocreate a trust, however, only when such intention can be fairlypresumed from the language of the instrument or the terms employed.Golstein v. Handley, 390 Ill. 118, 60 N.E.2d 851 (1945).

An escrow is defined as a written instrument that, by itsterms, imports a legal obligation, and that is deposited by thegrantor with a third party to be kept until the performance of acondition or happening of an event, at which time it is to bedelivered to the grantee. Merchants National Bank v. Frazier, 329Ill. App. 191, 67 N.E.2d 611 (1946). Merely labeling an agreementan "escrow" or a "trust" does not determine the real character ofthe transaction to be accomplished. Its true purpose must bedetermined from the relations of the parties and their respectiverights and duties. Merchants, 329 Ill. App. at 202, 67 N.E.2d at618.

A trustee holds legal title to property for the welfare of thebeneficiary, who holds equitable title. An escrow agent, on theother hand, is not vested with title to the property, though he maybe entrusted with possession and he may have power to pass title.Merchants, 329 Ill. App. at 200-01, 67 N.E.2d at 617.

We hold that the agreement in this case was an escrowagreement and not a trust. Though not decisive by itself, theagreement was clearly denoted an "escrow agreement" throughout. More importantly, it did not give Courthouse legal title to theproperty to hold for Brais. Rather, title remained in theEmhousers, and they retained the right to revoke the deed at anytime. Because the agreement was not a binding trust, it wasunnecessary that the agreement provide for its possible revocationby will in order for the deed to have been recalled by Harry'slater testamentary act.

We turn now to the question of whether the deed giving Braistitle to the farmland was validly delivered in order to determinewhether the property should be excluded from Harry's estate.

The churches suggest that the deed was not properly deliveredand, thus, title did not vest in Brais at Harry's death. Braiscounters this argument by citing Bulatovic v. Dobritchanin, 252Ill. App. 3d 122, 625 N.E.2d 26 (1993), for the proposition thatthe delivery of a deed to an escrow agent with a clear set ofinstructions is "delivery" as required for the conveyance of agift.

It is a long-standing rule in Illinois that a deed which isvalidly delivered becomes effective at the time of its delivery andcannot be revoked by a later act of the grantor. Johnson v.Fleming, 301 Ill. 139, 133 N.E. 667 (1921); Bulatovic, 252 Ill.App. 3d at 130, 625 N.E.2d at 33. Delivery of a deed is essentialto its validity, and delivery is a question of intent. Bulatovic,252 Ill. App. 3d at 129, 625 N.E.2d at 32. To be a completeddelivery, the grantor must have intended to part with all dominion,power and control over the deed. Bulatovic, 252 Ill. App. 3d at129, 625 N.E.2d at 32. In cases of delivery of a deed in escrow toa third person, the controlling question is whether the grantorreserved the right to recall or revoke his action. Herron v.Underwood, 152 Ill. App. 3d 144, 503 N.E.2d 1111 (1987).

In the instant case, the Emhousers specifically provided inthe escrow agreement that the agreement could be revoked prior tothe death of either Harry or Rose. As a result, the deed that wasthe subject of that agreement was not properly delivered and, thus,it could not effectively convey the property to Brais. For thesame reason, it did not create a valid gift of the property toBrais. Because delivery was lacking, the farmland became part ofHarry's estate at his death to be disposed of by his will. SeeHerron, 152 Ill. App. 3d at 146, 156, 503 N.E.2d at 1113, 1120. Accordingly, we affirm the trial court's order finding that thefarmland was part of Harry's estate.

For the foregoing reasons, the judgment of the circuit courtof Kankakee County is affirmed.

Affirmed.

LYTTON and McDADE, JJ., concur.