TECHNOLOGY P R O B AT E A New Era in Estate Planning for the Digital Age Today’s business and personal planning landscape is dramatically different from what we left behind in 2020 and 2021. The rapid adoption of technological innovations underscores the overused cliché that these are “unprecedented” times to navigate pandemic realities. During times of global crisis, the threat of uncertainty fosters creativity to overcome obstacles or to develop solutions never previously contemplated. There are three drivers of change disrupting the estate industry: the increased digitization of processes, acceleration of technology, and the increased usage and continued adoption of technology during and anticipated post-pandemic. Technical advancements have enabled the normalization of electronic document signing, with traditional wet signatures and paper-based estate planning no longer aligned with many clients’ expectations. The knowledge base surrounding the category of digital assets and the technical, legal, and practical challenges of planning for a client’s digital assets from email accounts to non-fungible tokens (NFTs) has burgeoned. Suppose professionals are lagging in advising clients on their use of technology on their estates. In that case, a sense of urgency is heightened as the technical planning spectrum will Technology—Property Editor: Ross Bruch, Brown Brothers Harriman & Co., One Logan Square, 14th Floor, Philadelphia, PA 19103. Contributing Authors: Jennifer L. Zegel, LL.M., TEP is the practice leader of Kleinbard LLC’s Trusts and Estates Group, based in Philadelphia, Pennsylvania. Sharon Hartung, Captain (Ret’d), PEng, TEP, is a professional engineer and author of Digital Executor®: Unraveling the New Path for Estate Planning and Your Digital Undertaker: Exploring Death in the Digital Age in Canada.
Technology—Probate provides information on current technology and microcomputer software of interest in the trust and estate area. The editors of Probate & Property welcome information and suggestions from readers. only increase. Clients will expect their estate plans to include their digital assets. Their representatives will ultimately hold practitioners accountable if they are not legally and technically accessible at the time of incapacity or death. Although we should be long past talking about social media and digitally-stored photos, it is worth revisiting basic terminology. Fundamentally, digital assets are our memories, financial records, documents, identities, collectibles, and information stored in digital form. The Uniform Law Commission’s model legislation, the Revised Fiduciary Access to Digital Assets Act (RUFADAA), defines digital assets as an electronic record in which an individual has a right or an interest. Most US states have adopted a version of RUFADAA. As overwhelming and abstract digital asset planning may appear to some, a professional advisor must prepare for this digital reality. This article orients the reader to digital awareness and aims to provide the perspective to affect the development of estate planning and administration practices. Integrating digital analysis into traditional estate planning requires a new planning paradigm. Digital Asset Entanglement: Unraveling the Intersection of Estate Laws & Technology, co-authored by the writers of this article and forthcoming by
LexisNexis® in March 2022, proposes a client persona framework to navigate a client’s digital universe. The book explores this developing framework against the case study of Gerald Cotten and his cryptocurrency exchange, Quadriga CX. Cotten died under mysterious circumstances in December 2018, leaving no plans for the management of his company, the largest cryptocurrency exchange in Canada. Quadriga was forced into bankruptcy, uncovering an abundance of issues. His estate was probated in the Probate Court of Halifax, Nova Scotia. Digital Assets Are Pervasive Within Client Portfolios Globally, court cases have emerged with families suing cloud service providers to provide access to digital assets. Examples include Ajemian v. Yahoo!, Inc., 84 N.E.3d 766 (Mass. 2017), where family members requested access to the deceased’s Yahoo account, and the UK’s Rachel Thompson case, where a widow sought access to her husband’s iCloud account. In the Matter of White, 2017 WL 8944064 (N.Y. Sur. Oct. 3, 2017), the administrator requested that the court grant access to emails containing information about the decedent’s business. The court limited the disclosure, in that case, to contact information in the account because the will was silent on digital assets. More complex issues stem from estates without cryptocurrency planning, such as the Estate of Matthew T. Mellon II (probate is ongoing in California, Los Angeles County Superior Court; Case No. 18STPB04491). Mr. Mellon died in 2018 with approximately $193 million of the cryptocurrency XRP on the Ripple blockchain, leaving no information to access the private keys (alphanumeric
Published in Probate & Property, Volume 36, No 2 © 2022 by the American Bar Association. Reproduced with permission. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association.
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March/April 2022
