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Estate Planning In A Digital World

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Posted on Oct 30, 2016 | Share this post: Like Us on Facebook Join Us on Google Follow Us on Twitter

Arizona recently enacted the “Uniform Fiduciary Access to Digital Assets Act.” If you think that sounds like a mouthful, that’s actually the name given as its “Short title”! There’s the government for you.

The act is a set of 18 statutes that attempt to deal with the legal issues involved for a Trustee, Personal Representative, or Agent under a Power of Attorney who is dealing with “digital assets.” The term “digital assets” can include a lot of different things: your ownership and intellectual property rights in social media accounts, your access to online bill payments or money processing, your rights to use software or listen to music, and your ability to view e-mails and other similar information.

Uniform laws like this are created by think tanks of lawyers and other professionals to be helpful in dealing with specific issues. They come up with a model, and then state legislatures can choose to enact them or adapt them for their own jurisdictions. This particular law is a valiant attempt to deal with the complex landscape of digital assets. In fact, Bogutz & Gordon is updating its estate planning documents to include references to the new law and to deal with these types of assets in general.

Overall, both the new state law and the provisions many estate planners are adding to documents are intended to grant fiduciaries the right to digital assets that the original owner had. Generally, an Agent, Trustee, or Personal Representative has the power to deal with all your stuff if you become incapacitated and when you die – whether real estate, stocks, bonds, bank accounts, and any other similar traditional assets. The point of this law is to ensure that a fiduciary has the same type of general rights and duties with respect to digital assets as well.

One comforting provision in all of these laws is to ensure that the fiduciary doesn’t commit criminal computer acts while trying to do his or her job. Before this law, there was the possibility that son or daughter, acting as Personal Representative for deceased parent, could be guilty of fraud for accessing the parent’s digital account using the parent’s password. So, simply doing their job in good faith and looking up the online brokerage statement could have been a criminal act! This act should lay that issue to rest, because it makes clear that any person acting as a fiduciary is considered an authorized user and won’t be guilty of criminal conduct in Arizona.

Even with a law that gives fiduciaries access and rights to digital assets and estate planning documents that specifically give these powers, there are limitations to recovering information or exercising these abilities. From a technical perspective, almost all software, online services, and similar offerings require you to explicitly or implicitly agree to specific terms of service or user agreement. That becomes a binding contract that will supercede state law or estate planning documents. So Facebook or iTunes can generally respond, with legal validity, that they don’t have to talk to your Agent or a Trustee if that’s covered in the terms you agreed to.

There is also the practical problem of getting the person on the other end of the phone or the other side of the chat box to understand your legal rights to access mom or dad’s account. Even if you have the legal right to do so, if the company’s support infrastructure isn’t well versed with this issue, you may not be able to get what you need.

It can be easy to forget how new these “rights” are. We are generally talking about things that didn’t exist at all 20 years ago and were barely developed and available 10 years ago. That’s an incredibly young landscape, and the law has had to quickly develop to try to deal with this burgeoning field that impacts so many people so deeply. There’s no guarantee the new law or new provisions in estate planning documents will solve the digital issues encountered by a fiduciary, but they at least provide a better set of tools to try.