Update: Wills, Trusts, and Estate Planning for Digital Assets and Electronically Store Information
About two weeks ago, our governor signed into law an act known as the “Fiduciary Access to Digital Assets Act”. This is in response to the uncertainty that surrounds the ownership of electronic information in such places as social media, Facebook, Flickr, Cloud, etc. I commented on this issue in 2014 here and I am happy to say Michigan went further than what was being discussed two years ago.
This law allows a fiduciary (someone acting on a behalf of and for the benefit of others) under a Power of Attorney, a Personal Representative (executor to a Will), a conservator, or a trustee to gain access to and control digital assets of the decedent/ward.
It should be noted that a “fiduciary” is under the highest standard of care for his/her conduct. This empowerment is focused on the original owner of the digital asset/electronic information (“decedent”) and making sure his/her will is carried out. A fiduciary’s duties include the duty of due care, the duty of loyalty, and the duty of confidentiality.
A digital custodian, (the person, business, or corporation that carries, maintains, processes, receives, or stores a digital asset of a user) is required to disclose to the fiduciary the content of an electronic communication and to disclose to the fiduciary a catalog of electronic communication sent or received. However the original user may provide limitations to this which the digital custodian will follow.
In short, if a decedent used an online tool to provide specific direction to a digital custodian, this has the highest priority and will override the request of a fiduciary. Also, if a decedent has given specific instructions in his/her will or trust concerning limitation or availability to a fiduciary, this also overrides the request of a fiduciary. However, a fiduciary’s request without an online tool or specific limitation will override the general terms of service agreements that a user normally must agree to prior to using online digital asset services.
The law specifically indicates that once a fiduciary makes a formal request a digital custodian has 56 days to comply. Failure to comply will allow the fiduciary to file a petition and otherwise apply to the court for an order directing compliance.
Our legislature created a definition of digital assets which allows us to utilize our standard estate planning, wills, and trust mechanisms. They went beyond that and provided the rights with the digital custodian in a fashion as if they were the original user – just like traditional estate planning, Will, and Trust law.
While the laws have now been improved my counsel remains the same. Make sure you deal with your digital assets during your normal estate planning. If you are doing a Will, include broad, specific authority over your digital assets to your Personal Representative, unless restrictions are in order. The same for a trustee and a Trust. The point is we now have a voice and should utilize it. See your Estate Planning Lawyer today!
Robert C. Miller is a Saginaw attorney focusing on business litigation, succession planning as well as wills and estate planning. He has been a lawyer since 1983 and is admitted to practice law in Michigan, California, and the United States Supreme Court. In addition he is also a CPA (Certified Public Accountant) and an AEP (Accredited Estate Planner).