Computer technology and the Internet are relatively recent inventions when compared to traditional estate planning strategies. In the short time that they have been widely available, they have caused a fundamental shift in society and the way that information and assets are stored and accessed. For many people, their digital presence has become interwoven with the rest of their life. The shift has not been restricted to a single generation: the young and old alike have sought to acquaint themselves with new technologies and the associated convenience.
Due to their novelty, many Canadians have likely not considered the monetary or sentimental value attached to digital assets. Overlooking digital assets during the estate planning process increases the likelihood that an estate's administration will be complicated and subject to litigation due to the inaccessibility of digital assets or disputes regarding how they ought to be administered.
Digital assets pose a unique set of challenges within the context of estate planning. Digital assets can consist of anything stored or accessible online, including one's presence on social media. Digital assets also include any online currency, such as Bitcoins, credit systems such as Paypal, and other assets that may or may not have real monetary value. The people in our lives may not always be aware of the extent of our online presences, and surviving friends and family members may overlook digital assets that have financial or sentimental value unless details are shared during one's lifetime or within a digital estate plan.
Failing to address the issue of digital assets within an estate plan can leave one's executor with the daunting task of attempting to piece them together.
In its simplest form, a digital estate plan can be a list of online accounts and passwords, with basic instructions regarding what is intended to happen to these assets after death. Features available through some online accounts, such as Google's inactive account manager and Facebook's legacy contact option, may help facilitate the implementation of one's wishes in respect of a digital estate plan. Failing to address the issue of digital assets within an estate plan can leave one's executor with the daunting task of attempting to piece them together. It may also result in complete inaccessibility of some or all digital assets or lead to significant expense in regaining access.
Simply identifying digital assets can be very difficult. Physical assets may be more likely to be accompanied by a paper trail, even if these assets cannot be located immediately. Without a list or other record indicating which online services and accounts the owner has used, it may be very difficult for family members or an estate trustee to determine where any digital assets have been stored and the related login information. A search of extended Internet history may be helpful in ascertaining whether the owner made use of a particular website. A detailed review of computer hard drive contents may also be necessary.
Online social media, if unaddressed by an estate plan, can be the cause of litigation. A person's social media may include writings, pictures or other mementos. These items may hold sentimental value to that person's family members and friends in a way that may not have been contemplated by the deceased. The distribution and administration of this information, if left unaddressed by an estate plan, may result in conflict. The issue of whether or not an account remains open following death, subject to user policies of the platform, may lead to dispute if wishes are not expressed by the deceased. Some surviving loved ones may want social media accounts closed to provide a degree of closure, while others may seek to have the deceased's presence online remain intact for the sake of comfort. The best solution is to address these problems in a digital estate plan to assist in preventing conflicts that may otherwise be avoidable.
Another difficulty that is best addressed as part of an estate plan involves the agreements between a user and a service provider. Many of these service agreements involve privacy protections that restrict a service provider's ability to provide disclosure of a user's information. Especially within the context of sparse legislation regarding to whom a service provider may release this information and under what circumstances, an digital estate plan should provide specific authorization to a named representative, as formal, written authority may better serve to facilitate access to account information by an estate trustee or other individual authorized by the user to obtain access to the information.
Some jurisdictions have now begun to introduce legislation to address the legal issues arising as a result of the prevalence of digital assets and the inadequacy of the typical estate plan in addressing them. Ontario has not yet enacted legislation to provide guidance on how to administer or distribute digital assets. Without any default rules relating to the treatment of digital assets on death, proper estate planning is crucial in avoiding any delay, expense or conflict relating to these assets.
Ian Hull and Suzana Popovic-Montag are partners at Hull & Hull LLP, an innovative law firm that practices exclusively in estate, trust and capacity litigation. To watch more Hull & Hull TV episodes, please visit our Hull & Hull TV page.
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