Administering Digital Estates

The Revised Uniform Fiduciary Access to Digital Assets Act was developed by the Uniform Law Commission to address a fiduciary’s ability to access and administer digital assets as trustee of a trust, executor of a will or as an agent under a power of attorney.  Before RUFADAA, fiduciaries’ access to digital assets was governed by the Terms of Service (TOS) from the Service Provider, such as Google or Facebook, and Federal law drafted many years ago before so much personal information was stored on computers and online.  Today, this personal information, which is often critically important for a fiduciary to carry out of their duties, is often only held in digital form.  Existing Federal law and the TOS kept a fiduciary from accessing those digital assets, and hindered their ability to carry out their fiduciary duties.  The Uniform Law Commission drafted RUFADAA to address the disconnect between the TOS, Federal law and the fiduciary’s duties under local law.

Consider a client who has bank and brokerage accounts and receives statements only electronically.  All bills are paid online, and most are on auto-pay.  For a client such as this, there may be no physical, paper-based evidence of their assets and liabilities.  The only access to these assets might be through client’s email or smartphone.  In the pre-RUFADAA days, a fiduciary may not have been able to access the client’s online accounts, their smartphone or their computer, and may not have been able to learn of the client’s assets and liabilities.

Although most digital assets may themselves have little or no monetary value, they will almost certainly have a great deal of informational value.  Online access to bank account information, emails, text messages and social media posts will likely be extremely valuable to a fiduciary in discovering information about a decedent’s assets, liabilities and other important information.

 

What Does RUFADAA Do?

RUFADAA provides a statutory framework to allow a fiduciary to access a client’s computer, smartphone, online accounts, cryptocurrency (e.g., bitcoin), social media, electronic communication and other “digital assets.”  RUFADAA has been enacted in all but six U.S. states.  Three of the six, plus the District of Columbia, have introduced RUFADAA legislation.  California has its own digital asset access law, which is modeled on RUFADAA, and is even called the Revised Uniform Fiduciary Access to Digital Assets Act, but for some reason California is not considered by the ULC to have adopted RUFADAA. 

RUFADAA applies to an agent acting under a power of attorney, the personal representative of an estate, a conservator or guardian, a trustee of a trust and the custodian of a bank account such as an UTMA account.  It does not apply to the digital assets of an employer used by an employee during the ordinary course of their employment. 

Access to online accounts such as Gmail or Facebook are governed by the Service Provider’s TOS.  The TOS typically does not allow access by anyone other than the “User.”  Fiduciaries, who are generally not the User, have had difficulty getting Service Providers to allow access to these accounts, and prior to RUFADAA, courts have not been uniformly helpful to fiduciaries in allowing access.  RUFADAA allows a User, in their will, trust or power of attorney, to authorize the fiduciary to access some or all of the User’s digital assets. RUFADAA also allows a User to designate a third party to access their digital assets via an “online tool” provided by the Service Provider.  An example of an online tool would be Google’s Inactive Account Manager, which allows the User to designate a third person to access the User’s account if the account has been inactive for a period of time selected by the User.  Use of an online tool or specifically granting a fiduciary access to the User’s digital assets overrides the Service Provider’s TOS.

 

What Are RUFADAA’s Limitations?

Even if a fiduciary is given access to a User’s digital assets, the Service Provider still has sole discretion to grant access to the fiduciary.  The Service Provider can also assess a reasonable administrative charge for granting access.  The Service Provider can also refuse to comply with the request from the fiduciary if complying would create an undue burden on the Service Provider.

A fiduciary who has been given access to a User’s digital assets or communications under RFUADAA has no more rights than the User had under the TOS.  While this may not necessarily create a problem with a fiduciary’s ability to carry out their duties, it may limit the information that a fiduciary would need to carry out those duties.  A fiduciary may need information from a User’s social media accounts, but if the User closed those accounts, the fiduciary may not be able to access the accounts, if the TOS would not allow the User to access the closed account.

As mentioned above, RUFADAA does not grant a fiduciary access to the digital assets or communications of a user’s employer.  This means the fiduciary cannot rely on RUFADAA to access an employee’s work email, and company-issued cell phones and computers.

Most importantly, the rights granted under RUFADAA are available to a fiduciary only when expressly granted in the governing instrument (i.e. will, trust or power of attorney).  Unless the instrument specifically gives the fiduciary the right to access a User’s digital assets, RUFADAA will not apply.

 

How Can a Fiduciary Access Digital Assets if RUFADAA Doesn’t Apply?

RUFADAA is a relatively new law.  California’s version became effective only in 2017.  Wills, trusts and powers of attorney drafted before enactment will not likely not have language granting the fiduciary access to digital assets.  A fiduciary cannot take advantage of RUFADAA if the instrument they are administering does not allow access to digital assets.  All is not necessarily lost in this case.  In the absence of express access under RUFADAA, a fiduciary’s access would be governed by the Service Provider’s TOS.  Many Service Providers provide some ability for a third party who is not the User to access the User’s account.  Google, for example, allows a family member or “representative” to close a deceased User’s account and may in some circumstances provide some information from the deceased User’s account, even if the User does not utilize the Inactive Account Manager.  Though nowhere near as comprehensive as a fiduciary’s access under RUFADAA, if the fiduciary has no other options, they could operate within the TOS of the Service Provider to get whatever information they can.

Prior to RUFADAA, courts had not been consistent in their allowing a fiduciary access to digital assets.  Courts have upheld limitations in Service Providers’ TOS that deny access to the User’s digital assets by anyone other than the User.  Some Service Providers take the position that the User’s account information belongs to the Service Provider, and not to the User, and TOS protects limits access accordingly.

 

What Can Be Done?

For anyone preparing or updating their estate plans, it is critical to make sure you have a clear understanding of your digital assets.  What are your online accounts?  What information about you, your finances, your family and your assets exist only online?  The next step is to make sure your estate planning documents grant your nominated fiduciary access to your digital assets.  You should also review your online accounts to determine if there is an Online Tool you can utilize.

The digital world is here to stay, and our lives will continue to migrate more fully online.  It is important to keep this mind when planning our estates.

 

David D. Little is Certified Specialist in Estate Planning, Trust, and Probate Law and an attorney with Hartog, Baer & Hand. He can be reached at [email protected].