An issue that is becoming more and more relevant in recent years is digital assets, specifically what becomes of them after an individual becomes incompetent or dies. In their article, Jean Gordon Carter, Andrea C. Chomakos, Melissa L. Kreager and E. Graham McGoogan Jr. discuss a new North Carolina law granting fiduciaries access to digital assets. The authors explain,
Digital assets are controlled by their terms of service, in the original contract created when someone sets up a digital account — the contract people seldom read but passively finalize just by clicking “I accept.” Those contracts generally protect privacy, not allowing legal access to others, while not dealing with death or other life events that would prevent an individual from controlling his own digital assets.
This summer, North Carolina joined the majority of states in considering this problem, and enacted the Revised Uniform Fiduciary Access to Digital Assets Act (Session Law 2016-53) allowing North Carolinians to determine who can, or cannot, access their digital assets. Based on the individual’s decisions, fiduciaries can now access the individual’s digital assets to handle them appropriately. Those fiduciaries include executors, agents, trustees and guardians.
Specifically, North Carolinians can provide directions in their wills, powers of attorney, trusts or other records telling digital asset custodians to disclose (or not disclose) their digital assets to their fiduciaries. Importantly, individuals can use online tools for each of their digital assets, where available, to direct their digital asset custodians on handling their digital assets under various circumstances, such as death, or to designate who has various powers over their digital assets, known as a designated recipient. Under the new law, the online tools actually take precedence over instructions in a will, power of attorney or other such legal document.
If an individual has not specifically consented to allow his fiduciaries to access his digital assets, then his fiduciaries may still be able to access the catalogue for digital assets — for example, the “to/from” lines on emails, though this access may still require additional information and even court findings. Access to the content (substance) of digital assets is more difficult to obtain and is allowed only if the individual consented via an online tool, will or other legal document. Even then, the custodian may require further evidence and court findings before granting access. With proper evidence, fiduciaries can also terminate digital accounts.
Read the entire story here: Private Wealth Services | New North Carolina Law Allows Fiduciaries Access to Digital Assets, but Only If …
Posted by Allison Trupp, Associate Editor, Wealth Strategies Journal