Virginia Lawyer

VaLawyer_June/July 2013

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Consultus Electronica Estate Planning and the Challenges of Digital Assets The Internet presents new challenges for estate lawyers, who have only recently begun to think about planning for the disposition of a client's personal and business digital property. Digital property is often hidden from view. A client's loved ones may have no idea what property exists or where to find it. The best advice we can give clients is to keep a detailed list of their digital property with access information — user name, password, PIN, security question and answer, and who has access or at least how to access an "asset vault" of all of the required login data. This digital inventory will be useful to clients who can then prepare a digital property memo. Deborah Matthews tells clients not to opt out of paper financial statements. She advises them to toss the statements as soon as they're received, but that way the account won't be hidden. One of her clients bought an old-fashioned address book that her family uses to track accounts and passwords - that is kept away from the computer. Another prepared a list of all accounts, security questions, and current passwords and gave it to her in a sealed envelope with written instructions on when and to whom it is to be released. We recommend the gold standard, keeping data in an encrypted electronic file for security and identity theft reasons, but at least someone is thinking about how to deal with digital assets after death. Unlike an unknown bank account where a statement will arrive in the mail sooner or later or be found by asking the IRS about reported interest payments, digital property is harder to locate. Once found, it can be difficult, if not impossible, to access. This is true not only for estate planners but corporate counsel too. Matthews was visited by a young widow after her husband's unexpected death. In their family, he paid bills using online access to their joint bank account. Having never accessed it online, she asked the bank for his password since www.vsb.org she was now the sole owner. The bank refused. She became the court-appointed administrator of his estate and the bank still refused. Unable to learn about the online transactions, she ended up closing the account and having to wait to see what was or wasn't paid — and incurring late fees. Those Pesky Terms of Service: What Happens to the Account of a Deceased User? As clients create their digital property, they click and consent to the provider's ToS. Few clients — or their lawyers — read the ToS or know that they have agreed to policies which will apply upon their incapacity or death. Some companies, such as Google and Yahoo!, state that allowing anyone else to access your account violates the ToS, further complicating planning for digital property. So you leave a list of passwords to your spouse and then your spouse violates the ToS by logging in as you. It entirely defeats the purpose. Some states have begun to address the challenges of digital property when the owner becomes incapacitated or dies. One of the most comprehensive laws was enacted in Oklahoma, though it considers only accounts of a deceased person, not those of the incapacitated. It narrowly defines the sites to which the law applies and does not explicitly override the ToS agreed to when the account or site was opened. Indiana, Connecticut, Idaho, Nebraska, and Oregon also have digital property laws while Maryland, New York, and North Dakota have such laws pending in their legislatures. In Virginia, the governor has signed a bill, effective on July 1, 2013, that permits the personal representative of a deceased minor to step into the minor's place for the ToS with providers of Internet services, communications services, or other online accounts to obtain the minor's communications and subscriber records. The provider must give access within sixty days of a written request. A broader bill was withdrawn after receiving opposition from Google, AOL, and the motion picture industry. Loved ones have been forced into courtrooms to get access to digital property. When Yahoo! refused to permit access to the family of Lance Corporal Jason Ellsworth, a soldier killed in Iraq, they fought back and got a state probate judge to order the e-mail turned over. In another family, Karen Williams found comfort after her son died in a motorcycle crash when she read his Facebook wall. But when Facebook learned of his death, his page was immediately shuttered until she got a judge to reopen it. It isn't only the ToS you need to worry about. Most providers will argue that the federal Stored Communications Act prohibits turning over users' content. The 1986 Act, while moldy and outdated technologically, remains the law and commentators are not sure that state laws could withstand a challenge in light of this law. We have seen many articles suggesting the appointment of a "digital executor" or a "social media executor." But what good will this appointment do if federal law or a site's ToS run counter to the appointment? Practical Estate Planning Advice for Attorneys Attorneys clearly need to address digital property as they assist with estate planning, intellectual property, and corporate matters. Estate planners should discuss who is to have access if a client becomes incapacitated or dies and also disposition of the property at the client's death. Court orders in guardianship or conservator cases that include express authority regarding digital property may be appropriate. Agents under powers of attorney can be granted express authority to act for the principal regarding digital assets, to the extent permitted by law and terms of service. Information gathered in an initial meeting intake form should be expanded to include digital property. Consideration should be given to providing a similar grant to agents under medical directives to ensure online medical records are accessible. In Virginia for Vol. 62 | June/July 2013 | VIRGINIA LAWYER 51

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