ULC has rewritten the “Uniform Fiduciary Access to Digital Assets Act”

The first version of the Uniform Fiduciary Access to Digital Assets Act, or UFADDA, emerged from major Internet and tech companies. They objected largely on the basis that the law violated the decedent’s privacy interests and would override many company’s current terms of service agreements.

In early 2015, the state-by-state legislative agenda for UFADAA appeared to be moving forward and on track and was introduced to 27 different state legislatures. Yet by the summer none of the states had enacted UFADAA, except for a modified 2014 edition adopted by Delaware.

Powerful opposition to the bill has prevented it from passing in states like Illinois. The bill appeared to be heading for passage by passing the Senate Judiciary Committee 9-0 and by passing the full Senate 57-0. There was not a single vote in opposition, yet still somehow the bill did not pass. On May 31, the bill was re-referred back to the House Rules Committee, where bills have little chance of ever seeing the light of day.

Tech companies didn’t stop at just preventing the act from passing, they also began lobbying for their own alternative bill called the Privacy Expectation Afterlife and Choices Act, or PEAC. The goal of the UFADAA was to presumptively vest an estate administrator with the ability to access digital assets, or in other words, have the ability to step into the shoes of the decedent for purposes of administering the estate. Unless the decedent affirmatively provided otherwise through a trust or a contract, the UFADAA would the administrator full access into the deceased’s digital accounts.

The PEAC’s approach was just the opposite, and would only allow an estate administrator to access digital accounts when the deceased expressly authorizes it. Further, even when expressly authorized, an estate administrator might only get access to so-called “outside of the envelope” information. For example, an administrator might discover that an email was sent from a Delta Airlines rewards program, but could not open the email to read its contents such as the person’s account reward balance. So far PEAC has been enacted in one state, Virginia, and introduced to two others.

The Uniform Law Commission, which strongly supports the UFADAA is now trying to reach out to the other side in order to bridge the gap between the two parties. This approach has resulted in a revised UFADAA, which was officially approved on July 15. The revised UFADAA has introduced a number of changes like the “online tool” for directing fiduciary access. An online tool is defined as an electronic service provided by a custodian that is distinct and separate from the TOS.   The revised act expressly permits a custodian to offer an online tool and provides that a direction regarding disclosure using an online tool supersedes a contrary direction in a will, trust, or power of attorney.

One of the main ways the revised edition closes the gap between the two parties regarding the disclosing of communications. The act calls for a compromise that would allow an administrator to have the “outside of the envelope” information without express consent, but require the express consent of the administrator to read the actual content.

So what does the revised UFADAA mean for the common person. The fundament shift in vision the act proposes will make it more important that ever for a person to have an estate plan and to directly address fiduciary access to digital assets within the estate plan. As time goes on digital assets will only become more common, and there is no reason these assets should not pass to loved ones like any other asset. For more information on how to secure your digital assets contact the Law Office of David M. Goldman PLLC today at 904-685-1200.

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