We Live Online.
Once upon a time, the chronicles of our life where held on paper - a photograph, a business card, a journal. This was the "stuff" we left behind. Today, for better or worse (a discussion for another time and place), we live just as prominently online as out in the real world. Email accounts, Facebook accounts, Pinterest accounts, Twitter accounts, Flickr accounts, shopping accounts, blogs - and that just scratches the surface. These online outlets are diverse and varied, and contain important information. Whereas an executor once relied on paper to track down property, money, and physical assets upon someone's death, today they're going to have to track down such things electronically.
William Harnish, of Snell & Wilmer, elaborates, "Communications are now often stored only in electronic form; receipts for purchases are often emailed instead of printed; significant contracts are executed with a click of a mouse, and even sentimental things like photographs and family videos are being stored in “the cloud” through online services. Evidence of valuable assets such as digital music files, e-books, or video libraries, or even accumulated frequent traveler points, may not exist in paper form in a person’s records. Indeed, even the account IDs and passwords needed to access those on-line accounts may themselves only be stored on-line in a “digital wallet.”
This digitilization of our lives makes the task of your executor more difficult as he or she attempts to administer your estate after your passing. And, this isn't just an issue at death. In the unfortunate case of incapacitation during your life, the same difficulties apply to those acting under powers of attorney, conservators, trustees, etc
So What's The Problem? And, What Are The Solutions?
Well, there are two problems. One is gaining access to digital information. The other is the sheer difficulty of finding it all. The first may be statutorily helped. The second is pretty much up to you and your crafty estate planning.
Gaining Access to Digital Assets.
Solution? The Uniform Law Commission released a draft of the Uniform Fiduciary Access to Digital Access Act in 2014 (further revised in 2015). The act seeks to find a middle ground, between a fiduciary's (fancy word - it means your executor, your trustee, your conservator, your guardian, or the person legally taking care of you; note: the UFADAA does not define it to mean that family members of a decedent may not unilaterally claim the power of a fiduciary to access your information without being appointed) need to access your digital information and an online service provider's need to protect and withhold it. The 2015 revised UFADAA has been adopted in 23 states so far and endorsed by Facebook, Google and a good amount of other service providers.
Harnish summarizes the key clauses of the UFDAA as follows:
Section 5 – A fiduciary has the same rights under an online service provider’s terms of services as the decedent. The fiduciary is treated as if standing in the shoes of the “protected person” – the owner of the digital assets. A custodian maintains its same rights under the terms of service. The Revised UFADAA defines a custodian as “a person that carries, maintains, processes, receives, or stores a digital asset of a user”.
Section 6 – A custodian may choose how much access it will give to a fiduciary based on the custodian’s business model. A custodian’s options are:
Grant a fiduciary full access to a protected person’s account(s);
Grant a fiduciary just enough access to a protected person’s account sufficient to perform the fiduciary’s tasks; or
Provide a fiduciary a copy/list of digital assets that could have been accessed by the protected person if they were able to act on their own.
Sections 7 through 14 – Outlines what specific classes of fiduciaries must do in order to make a request of a custodian to access digital assets.
Custodians cannot be compelled to grant full access to a decedent’s account(s) if not specifically provided for in a will, trust, power of attorney, or other record, including a court order.
At the least, a custodian can provide the copy/list of digital assets, per Section 6.
Section 15 – A fiduciary has the same duties regarding digital assets as with tangible assets, namely a duty of care, loyalty, and confidentiality.
Section 16 – A custodian is immune from liability for an act or omission done in accordance to the Revised UFADAA and if done in good faith.
This law is still new, however. It's not be adopted by everyone and it won't solve all of the problems posted by digital assets. You need to take some of that on yourself, in your estate planning. How? Read on...
Finding Digital Assets.
In the "olden days" (I'm headed back all of ten years here) you kept key documents and important things in safe places. A handful of people knew what and where they were. Upon a few conversations or some key found in a desk drawer, your executor or trustee or whoever would be able to find the file or box that was important to handle the majority of issues that came up. Yes, sometimes they'd find an account no one knew about or something else soap opera-worthy, but really that was the extent of it. Not so today.
Dennis Kennedy, writing for Law Practice Today, asks you "to do this mental exercise: Can you quickly and easily find all the valuable documents and files on your computers? Or, as is likely, are they scattered among many folders, several computers, flash drives and backup ... How easy will it be for someone to sit down at your computer and find everything they need, especially if it’s now a struggle for you to do so?...Here’s another thought experiment: What if you use a thumbprint scanner or other biometric device for access to your computer?" Not to mention, what if you use the cloud? what if you share an Evernote account with someone? The search has no end.
Solution? You need to take this difciulty int oconsideration during your estate planning. Since the first step in either death or incapacity is to track down and identify all of your assets, liabilities, etc., you would be doing your fiduciary a great benefit by having taken inventory of your digital assets beforehand. This inventory would include:
Even by just creating this inventory to include in your estate plan, you'll have completed what would have been a near impossible task for your appointed fiduciary. But, you can go a step beyond by providing for access to them by password in your estate plan. Yes, this goes against everything you've ever learned about not writing down passwords. And, yes, this may somewhat be futile as passwords change and, thus, are somewhat of a moving target. But, they could help. And this information would be kept safe alongside your estate planning documents. In addition, you and your estate planning attorney could look into ways that your online accounts would allow you to designate others to act on your behalf under certain circumstances or be added to your accounts.
That is just the tip of the iceberg, you and your estate attorney can work to aggregate data appropriately and protect your digital estate in the same manner as your physical one. The real 'step one,' then is here, in this article. It is knowing that you should even be thinking about your digital assets, recognizing the difficulty that they could present and aiming to solve some of those future issues.
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