ESCROW

in Anglo-American law, written instrument, such as a land deed, constituting evidence of obligations between two or more parties, that is given to a third party with instructions that he deliver the instrument only upon the happening of a certain condition. In commercial usage, this condition is most frequently the performance of an act, such as payment of the purchase price, by the party who is to receive the written instrument. Escrow is also commonly used in family transactions, in which, upon the happening of the condition, such as the death of a family member, certain written instruments will be delivered by the third party (escrowee) to another family member. The term is occasionally used to refer to the state or condition of a deed that is held conditionally by a third party, although escrow properly refers only to the written instrument itself.