NO. 4-04-0093

IN THE APPELLATE COURT

OF ILLINOIS

FOURTH DISTRICT

On November 17, 2002, Richard W. Gabbett, died testate,leaving behind approximately 220 acres of land located in Mississippi Township, Jersey County, Illinois. Gabbett's will namedRobert L. Ray, his nephew, and W. Thomas Ryder as coexecutors ofthe estate. On August 6, 2003, Judith K. Landers, Gabbett'sdaughter, filed a petition asking the trial court to direct Rayand Ryder to distribute "Gabbett Land Trust Beneficial Interests," and referencing the land located in Mississippi Township,Jersey County, Illinois. On January 12, 2004, the court deniedLander's petition, finding "decedent died being the true recordtitle owner of the real estate." Landers appeals, arguing thatthe court erred by finding Gabbett did not "effectively" conveythe property into a land trust. We affirm.

Gabbett's will, dated December 1, 1982, contained thefollowing bequest to Ray:

"I make the following specific bequests:

1. I give the real estate that I own inMississippi Township, Jersey County, Illinoisplus all farm machinery, farm livestock,growing or stored grain, and all farm toolsto my nephew, ROBERT L. RAY. ROBERT L. RAYhas worked on the farm with me in recentyears and I know that he will continue tooperate the farm after my death. This giftis made in appreciation of his help and kindness to me."

Gabbett left the residue of his estate to his daughters, Landersand Joanne M. Ringhausen.

On December 2, 2002, the trial court appointed Ray andRyder as coexecutors of Gabbett's estate and ordered them to filean inventory within 60 days. On March 12, 2003, Ray and Ryderfiled an inventory "of the real and personal estate of thedecedent." On June 5, 2003, Ryder filed a petition seeking"court direction." Ryder stated he had "received information ofthe existence of certain documents relating to a Land Trustinvolving the Farm Property in a file of Attorney Gail Gisy'sbeing held at Attorney George P. Wittman's Office." Ryderreviewed the contents of the file held by Wittman. Ryder found"an original signed Land Trust Agreement, an original signed, butunrecorded Quit Claim Deed, and other documents." Ryder attachedcopies of the documents to his petition.

On August 6, 2003, Landers filed a petition asking thetrial court to direct Ray and Ryder to distribute "Gabbett LandTrust Beneficial Interests," asserting that the "beneficialinterests" were "personal property and *** pass under the residuary provisions of the decedent's will."

The record shows the following. On November 21, 1979,Gabbett appeared in Gisy's law office and signed multiple documents. A document titled "DEED IN TRUST" purported to transferthe land located in Mississippi Township, Jersey County, Illinois, into "the GABBETT LAND TRUST" via quitclaim deed. Thedocument identified Gabbett as the grantor and the trustee "underthe provisions of a TRUST AGREEMENT" dated November 21, 1979. The deed was not recorded.

The "TRUST AGREEMENT" also identified Gabbett astrustee and as sole beneficiary. In addition, the agreementprovided that "the total number of shares in said trust shallconsist of 5720 shares."

Gabbett signed four trust certificates and two "ASSIGNMENT OF INTEREST IN LAND TRUST" documents. The documents identified Gabbett as the owner of "5720 shares in certain property insaid Land Trust." Gabbett assigned three shares to each of hisdaughters. Following Gabbett's death, Ryder "received information" of the existence of the various documents located in a filein Wittman's law office.

On January 1, 1980, Gabbett appeared in Ryder's lawoffice and entered into a "JOINT VENTURE AGREEMENT" with Ray to"carry on, as joint venturers, a livestock and grain farmingoperation for profit." The agreement identified Gabbett as "theowner of 220 acres located in Section 10, Mississippi Township,Jersey County, Illinois." Further, the agreement recited that"[l]egal title to the real estate *** acquired prior to the dateof this agreement *** shall remain in [the] name of Richard W.Gabbett."

The record shows three additional trust certificatesand two additional "ASSIGNMENT OF INTEREST IN LAND TRUST" documents signed by Gabbett on December 16, 1980. Gabbett assignedthree additional shares "in certain property in said Land Trust"to each of his daughters. These documents were also found in thefile held by Wittman.

On September 1, 1982, Gabbett signed his will, giving"the real estate that I own in Mississippi Township, JerseyCounty, Illinois," to Ray.

After November 21, 1979, Gabbett continued to file hisown individual income tax returns and did not file fiduciaryincome tax returns as trustee.

Following a hearing, the trial court denied Lander'spetition, stating:

"The property was never treated by the decedent as being held in trust. He never filedfiduciary income tax returns. There is noevidence he distributed income to the holdersof beneficial interests. It is further evidenced by his recitals in the joint ventureagreement and in his last will that he, andnot the trust, was the owner of the realestate."

The court found "decedent died being the true record title ownerof the real estate."

This appeal followed.

Landers argues that the trial court erred by concludingthat Gabbett died "being the true record title owner of the realestate." Specifically, she challenges the court's conclusionthat Gabbett did not "effectively" convey the property into aland trust.

A conveyance of real property does not occur merelythrough the execution of a deed. The grantor must also deliverthe deed, and the grantee must accept it. Seibert v. Seibert,379 Ill. 470, 477-78, 41 N.E.2d 544, 547 (1942); In re Estate ofWittmond, 314 Ill. App. 3d 720, 724, 732 N.E.2d 659, 662 (2000).

Delivery of a deed is essential to complete a conveyance, andalthough no particular method of delivery is required (McClugagev. Taylor, 352 Ill. 550, 557, 186 N.E. 145, 148 (1933)), thegrantee must affirmatively show that the grantor's words orconduct evinced an intent to pass title at the time of thepurported delivery (Foster v. Foster, 273 Ill. App. 3d 106, 110,652 N.E.2d 350, 353 (1995), citing Seibert, 379 Ill. at 478, 41N.E.2d at 547).

"[P]lacing a deed in the hands of a granteedoes not constitute delivery where it isshown the intention of the parties was thatit was not to become operative immediatelyand where such intention is evidenced bycontinued acts of ownership and operation."Seibert, 379 Ill. at 478, 41 N.E.2d at 547.

Citing Whittaker v. Stables, 339 Ill. App. 3d 943, 791N.E.2d 588 (2003), Landers contends she need not provide evidenceof delivery because the various instruments named Gabbett as solegrantor and sole grantee. Therefore, "delivery and acceptance*** is automatic[]." Such a presumption is contrary to the long-standing rule that no delivery is presumed where the grantorretains possession of the deed. See Dunn v. Heasley, 375 Ill.43, 48, 30 N.E.2d 628, 631 (1940); Wittmond, 314 Ill. App. 3d at725-26, 732 N.E.2d at 663.

In Whittaker, the appellate court held that a lettercreated by a single individual serving as grantor and granteesatisfied the requirements to amend a trust "[i]n terms of'delivery.'" Whittaker, 339 Ill. App. 3d at 948, 791 N.E.2d at592. Whether the grantor intended to pass title at the time ofdelivery was not at issue.

We note that this case presents a unique situation. Atthe time of the purported delivery, Gabbett not only served assole grantor and sole trustee, but also as sole beneficiary. Theparties do not cite to a case in which the same person was at thesame time sole grantor, sole trustee, and sole beneficiary. InWilson v. Harrold, 288 Ill. 388, 391, 123 N.E. 563, 564 (1919),our supreme court held that the same individual cannot be at thesame time sole trustee and sole beneficiary of the same identicalinterest.

Although a settlor may create a trust of personalproperty whereby he names himself as trustee and acts as such forthe beneficiary (Farkas v. Williams, 5 Ill. 2d 417, 425, 125N.E.2d 600, 605 (1955)), and a grantor/trust settlor may also bea beneficiary of a land trust (Wittmond, 314 Ill. App. 3d at 725,732 N.E.2d at 663), there must be a completed separation andtransfer of the legal interests from the beneficial interests (Samuel v. Northern Trust Co., 34 Ill. App. 3d 500, 505, 340N.E.2d 162, 166 (1975)). In the present case, Gabbett remainedin possession of the land and exercised complete control over itfor his own benefit. A trust cannot exist when the legal andbeneficial interests are in the same person.

Further, the record does not show that Gabbett intendedto pass title at the time of the purported delivery. Immediatelyafter the execution of each of the various documents, Gabbettcontinued to deal with the land as if he owned the propertyabsolutely. He continued to file his own individual income taxreturns and did not file fiduciary income tax returns as trustee. The record does not show any other individual filed taxes onincome generated by the farm. Gabbett entered into a "JOINTVENTURE AGREEMENT" identifying himself as "the owner of 220 acreslocated in Section 10, Mississippi Township, Jersey County,Illinois." The agreement recited that "[l]egal title to the realestate *** shall remain in name of Richard W. Gabbett." OnSeptember 1, 1982, Gabbett signed his will giving "the realestate that I own in Mississippi Township, Jersey County, Illinois," to Ray. An absolute owner may dispose of his propertyduring his lifetime in any manner he sees fit. Farkas, 5 Ill. 2dat 422, 125 N.E.2d at 603.

Further, the deed of conveyance was found in thepossession of a third party (Wittman) following Gabbett's death. The sole testimony at hearing was that Landers was present inGisy's law office on November 21, 1979, and she observed herfather sign the various documents. The record does not showwhether Gabbett left the deed with Gisy without the right toreclaim it or how the documents were relocated to Wittman's lawoffice.

Accordingly, the trial court's finding that "decedentdied being the true record title owner of the real estate" is notagainst the manifest weight of the evidence.

Because we affirm the trial court's order, we need notaddress respondent's cross-appeal.

For the reasons stated, we affirm the trial court'sjudgment.

Affirmed.

TURNER and STEIGMANN, JJ., concur.