January 14, 2015

2015 Legislation Watch–Kentucky and Seven Other States Introduce Uniform Fiduciary Access to Digital Assets Act

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The goal of estate planning attorneys has always been to provide their clients with control – control over their assets during their lives and a say in how those assets are distributed at their deaths, and as property itself (and financial account access) transitions into digital form, the law which attorneys use to provide this control will need to catch up.  
As we wrote about in November[1], both the law and technology companies are in the midst of trying to figure out how state laws governing inheritance and access to assets should be changed, if at all, to govern this new electronic world, particularly when people die and wish to allow their executors, trustees, and other fiduciaries to act with regard to “digital” assets. 
Last August, Delaware became the first state in the union to pass a version of the Uniform Fiduciary Access to Digital Assets Act (“UFADAA”), designed to provide the guidance and authority necessary for executors, administrators, guardians, conservators, attorneys-in-fact, and trustees to act with regard to digital assets just as they already do with regards to tangible property.   
As we noted previously, UFADAA brings up questions as well as answers.  It raises privacy concerns – does an attorney-in-fact have the right to read all of your email?  Some information service providers have expressed concerns about revealing to fiduciaries information that a decedent intended to keep private.  Moreover, they note that release of information to a fiduciary can sometimes implicate privacy issues of persons who are still living.  One example would be email between a patient and his or her psychiatrist or minister.
In the wake of the Delaware enactment, other states appear poised to consider similar revisions to their own laws.  On January 6, State Senator Whitney Westerfield (R-Ky.-3) introduced a Kentucky bill[2] closely modeled on the uniform act.  Though there is no indication as of yet whether the bill will pass, and there appears to be some opposition to it, similar legislation has been proposed in other states. 
The law is indeed attempting to catch up to the times.  But regardless of whether our law changes this year, there are steps that Kentuckians can take now to ensure their wishes related to digital property can be respected in the future.  For more information, contact one of the attorneys in Stoll Keenon Ogden’s Trusts, Estates & Family Law practice.

[1] What Happens to Your Digital Life When You Die?

[2] AN ACT relating to the Uniform Fiduciary Access to Digital Assets Act.