0:00 [Music] who are you and where are you going what do you [Music] want hello and welcome to trust and Estates weekly I'm your host Kevin bemel and we're here every Monday at 10: a.m. Pacific time to talk about all of those things related to to Estate Planning and trust and probate Administration both from our individual
0:36 standpoints what what we each need to do for our own situations as well as being a professional like me who helps people with with handling those matters and once again I've forgotten to close my email one of these days I'll remember it even says right here on my chart close your Apple Mail okay so today I'm going to be talking talking about something called rufida Ruf a daa the reformed uniform uh fiduciary access to digital assets act now I I
1:15 I've talked uh I I think a couple of times on various aspects of digital assets and they are of an ever an increasingly important aspect of both estate planning and a state Administration so uh you know more and more people and and and by the way let me let me start out by defining digital assets so when I use that term I suspect most of you are thinking things like something like cryptocurrency okay or um what are they
1:53 non-fungible tokens nfts those kind of things while it does include those those may not be the most important digital Assets in an estate and in fact an estate May own no digital no cryptocurrencies at all and still uh be um uh affected by uh having digital assets so these include not just things like cryptocurrencies and nfts
2:30 includes online accounts or access to accounts through online portals it includes social media an email okay all of those constitute digital assets now you may say well wait a minute email is not an asset there's no value in email well there may be no Financial value to the email per se okay but the the email May the emails contain information and that information may be
3:07 valuable to the estate for what it says about certain administrative issues um the on online access to bank accounts or brokerage accounts that online access itself may not be may not be valuable per se but the a access ACC to the assets through an online portal definitely is valuable okay and so that that's why I wanted to talk about this
3:43 this subject okay so when we talk about digital assets again we're talking about that in a very broad way okay so um in um 2014 the uniform fiduciary Act access to digital assets Act was passed by the uniform law commission now let me be clear about how the uniform law commission works okay the uniform the ulc does not have legislative Authority okay what it does is it
4:22 proposes a uniform law and then each state can decide Ides whether to adopt that uniform law or not probably the most uh welln and and I don't know if it's the oldest but it's among the oldest is the Uniform Commercial Code the UCC I first dealt with this back when I was a law clerk having recently got out of college in the early 1980s and what the UCC did was it
4:58 provided a uniform way to create a security interest in personal property now this was incredibly Innovative and good for Commerce whereas with real estate it was easy to create a security interest meaning make the real estate um collateral for a debt because a a mortgage a trusteed could be um uh
5:35 recorded at the out of County record office in which the property was located and that created a lean on that piece of real estate so that anyone dealing with the real estate would know oh there's a loan against this property but the same could not be done with say a car or Machinery owned by a manufacturing company okay and so what the UCC did is it created a set of laws that is that essentially allowed for the
6:10 recording of a sort of a of a document against personal property so that someone who was considering dealing with that personal property would know whether there were debts on it whether there were leans on it okay so now the and the UCC had to be passed by each of the 50 states okay as well as I think Washington DC Puerto Rico Etc the territories okay so the same is true with what was true with the
6:45 uniform uh it's a long name uniform fiduciary access to digital assets act okay that that was originally uh created in in 2014 now what happened was the large uh social media companies didn't like a lot of what was in the original act okay because they felt that it took away from their ability to interact with their customers in terms of how their how their particular social media site would
7:21 uh what would happen once a user died okay and so that spurred that that dialogue between social media companies and large tech companies and the and the ulc spurred the uh revised uniform fiduciary access to digital assets act which was passed not passes I shouldn't use that word it sounds like it's made leg which was created in 2015 okay and the law governs how
7:57 fiduciaries that means EX excutives trustees agents under Powers of Attorney okay professional fiduciaries like me who be who may be personal representatives of an estate how they can access the digital assets of a decedent or an incapacitated person meaning someone who's no longer able to take care of themselves that's where a power of attorney or what's called an attorney in fact comes in okay and these include emails social media accounts cloud storage cryptocurrencies Etc okay
8:33 so the key aspects of rufida are user control so the the the um roffa prioritizes owner the wishes of the owner of an account over anything else okay so if if for example the owner of um uh a a Google account um has has has used the online tools provided by Google to dictate what's going to happen with
9:08 that account after the user dies that takes precedence over what's in rufida okay and next another key aspect of it is that um if no instructions on digital assets are provided fiduciaries can gain access only if a will or a trust or a power of attorney explicitly gives permission okay so I'll talk about what that means a little bit later but but
9:45 there the the permission for access to digital assets has to be explicit and finally uh it it it prevents it prevent protects I should say the privacy of of a US user or a deceased user in that if the the user or deceased user did not explicitly authoriz access uh roffa limits what fiduciaries can access um often requiring a court order okay so why is this so important
10:23 well if if if you are dealing in a situation where where either you know there will be or you think there might be disputes between your heirs okay uh the access to digital assets is a an area ripe for creating disputes okay I'm dealing with a case right now where there's uh 10 or 12 potential beneficiaries to an estate
11:00 and the deed died in testate okay I'm I'm I don't know for a for a a fact yet because I I'm still in the appointment process but my guess is he has uh social media accounts he has bank accounts that can be access through online portals okay so if I am appointed as the administrator be I I'm going to need to make sure that there is explicit
11:37 language giving me authority to access the deed social media and other digital assets otherwise what I'm doing is I'm giving these these there's basically two camps of beneficiaries I'm giving both camps grounds to attack my administra ation on the basis of non-compliance with rufida okay and so this is why I wanted to cover this today because
12:13 uh while it would be nice to think that you know the administration of an estate um is going to go smoothly and people are going to agree uh that is oftentimes not the case so you know better to make sure you comply okay and and and and that will reduce the areas for dis that will yeah that will reduce the area for dispute um in in in the administration of a trust or or probate okay so let's look at the
12:49 states uh where it applies I'm going to take you to um the ulc uh website okay there we go okay great all right so you can see here this is a map of the United States obviously anywhere it's blue that state has adopted um rufa so you can see almost the entire almost all the states have the only that the only ones that haven't are
13:24 Louisiana which has not taken any action uh with respect to either rufida or its its predecessor uh Massachusetts which um has um as of this year a bill has been uh put forth in the state legislature to adapt it to adopt it and now Delaware shows his blue I'm sorry that's that's Rhode Island where's where's Delaware Delaware is right here here's Delaware okay Delaware adopted the predecessor to rufida but has not
14:01 adopted rufida nor has uh Puerto Rico okay so out of 53 possible jurisdictions uh there is what one two three there's three that have not excuse me adopted it and a fourth one that's that's on the way so uh let's look at the bills list okay and you can see here okay um it was like I said it was created in 2015 20 States adopted it in
14:36 in 2016 177 in 2017 and then five and then just a couple one or two in the year since 2019 and and you can see here's here's the list of the various jurisdictions that adopted my state of California finally adopted it last year along with Oklahoma Okay so again most of the states have enacted it okay the the next one that probably will is uh is Massachusetts oops oh shoot um
15:12 is Massachusetts and um and then what happens with you know Delaware Louisiana and Puerto Rico you know your guess is as good as mine um and by the way so you can see here's here's Massachusetts you can see that it was introduced in February by Massachusetts senator Barry fold uh Massachusetts uh Senate second uh District or whatever that is um and then it was introduced in the Massachusetts house on the 27th of February so just just recently just last month okay um
15:49 and uh you know they'll they'll study it and eventually they will uh vote on it presumably okay so you can see that um it it's it's widely adopted uh in in in the United States okay let's stop screen sharing okay there we go all right so um that's that's the you know the state of adoption all right so let's let's talk a little bit about its history so um as I mentioned um the the rise of
16:24 digital assets um basically um in essence sort of demanded that there be some sort of legislation as to how uh they they you know could be dealt with okay and and so um the movement started to do something about this now the large Tech platforms like Google and facebooka okay so um in their terms of service okay which is the agreement they
16:59 have between their users and themselves um prior to 2014 they explicitly prohibited third-party access now a lot of people ignored that and they gave you know someone else access to their site especially if it was for business right they would give someone the ability to access their their social media sit so that you know they didn't have to do it themselves um but that did violate um the terms of service of a lot of these
17:34 large tech companies you know what could they do about it I guess the worst thing they could do is probably kick you off their platform um okay and then there were federal laws like the stored Communications act and and the Computer Fraud and Abuse Act these also restricted um access to digital assets even for fiduciaries with legal Authority right so now you have this this this difficult situation where someone has been given the responsibility the duty to administrate
18:10 an estate or a trust um but federal law is hampering their ability to do that so in 2014 the uniform law commission created the uniform fiduciary access to digital assets act okay and it essentially treated digital assets like physical property and gave fiduciaries broad ass access to these digital assets and as I mentioned a little while ago this was opposed um by
18:46 a lot of the major tech companies who were concerned about privacy for their users and conflicts with federal law okay and so as a result of that only Denver adopted the original Act and the and and otherwise it was largely um uh rejected and so as as the ulc continued to work on this they they you know took on the they they took in the concerns of the large
19:21 tech companies they they elicited public comment etc etc okay and they came up with the re rised uniform uh fiduciary access to digital assets act in 2015 and and this balanced privacy user privacy concerns with fiduciary access okay so as I mentioned uh a little while ago it requires affirmative consent Express consent for
19:57 fiduciaries uh in order to access digital assets okay otherwise the default privacy permissions will govern and therefore to for example gain access to someone's Facebook account uh without an explicit authorization under rufida uh would be a violation of now state law okay so it's not a matter of well you've just violated the term of service agreement now with the exception
20:34 of Louisiana Delaware and and at least for now uh sorry Louisiana Delaware Puerto Rico at least for now Massachusetts if if as a fiduciary you gain you you access let's say a Facebook account without a specific authorization by the deceased user okay or or maybe the user isn't deceased they're incapacitated and you have a you have a durable power of attorney so now you're in violation of state law you would be here in California for example as of last year
21:09 when when California adopted rufida okay and so uh um rather than just accessing them okay uh what you would need to do is go to court and get a court order Grant granting you authority to access digital assets okay now um the the intent then of rufida and why it's why it matters is it it it gives
21:44 fiduciaries uh the ability to access and manage digital assets um while still respecting privacy okay and and and that's that look that's an important balancing uh function that we as as fiduciaries need to be concerned about in any event okay the nice thing about rufida now is there's a legal framework that we can follow so we can be relatively certain that we are complying with with the law and and and as much as
22:21 possible shielded from uh you know claims that were acting inappropriately Etc okay it also protects service providers meaning the tech companies meta Google Etc from liability when they allow legal access either because it's specifically provided for in a will let's say or a trust okay or it's been granted by court order okay and and and again for these large
22:57 companies you know the uncertainty is is the problem they don't want to violate their users privacy on the other hand they you know some there it may be important for a fiduciary to have access maybe to memorialize a Facebook page or something like that okay so rufida creates This legal framework under which this can happen okay so um let's talk now about just some key sections of Roff I'm not going to go through the whole thing I will put uh the link to the to
23:35 the ulc uh website that I just showed you a few minutes ago I'll put that link in the show notes so if you want to look up the full text of of the app you certainly can um you obviously you can also go to um the the uh probate code for your particular State and look at how it's been enacted in your particular State um but but in general I think you're going to find that it's it's pretty similar to what's on the ul's website and and and the key portions are what I talk about now
24:10 now I maybe I should have said this the beginning um those of you who are frequent Watchers of the show you know I am not a lawyer I do not give legal advice okay I'm just talking generally about this and and I'll I'm going to detail what I think you should do about it after I talk about the key Provisions okay but um but let me talk about those first and and then uh talk about you know how to deal with all this um but before I do that I do want to take just a little break I I forget to do this sometimes uh but I want to do take a
24:46 break and and remind you about um our LinkedIn group called uh trust and estate uh trust and estate experts Okay so this is a group that I created on LinkedIn for people who are involved professionally in Estate Planning and administration and for for individuals who are interested in the subject and and and want to interact with uh you know professionals and others of like interest um for for their own benefit
25:21 so um I encourage you uh to consider joining the group okay again it's called trusts and estate experts just go to um LinkedIn and you can search trusts and estate experts you'll see it's it it it the um the um branding for it looks very much like The Branding for my company okay and The Branding for the show and and you just need to click U um the um I want to join button or the membership
25:56 button excuse me and I'll be happy to admit you to the group and um you know especially if you're someone who like me creates content related to this subject and you're looking for another place where you can share that content would would love to have you do so so for my for example my friend uh Laura Israel who was involved in prenuptual agreements and and those sort of things which obviously um become part of estate planning so you'll see Lori uh posts uh
26:33 content from time to time including um uh last year she did a series of webinars on how to deal with prenuptual agreements with an Associate of hers so uh so you know um it's a great place to share it's a great place if you have a question or you just want to get some input on something uh with which you're dealing you can do that all at trusts trusts and estate experts my LinkedIn group okay now back to the show okay so key sections of rofida first of all
27:08 definitions okay so it establishes key terms including digital asset which is any digital record emails documents cryptocurrency social media content anything like that custodian okay a custodian is a company that holds digital assets Okay Google Facebook Apple Etc and a fiduciary is a person authorized to manage someone else's assets including Executives trustees or agents under uh Powers of
27:45 Attorney okay known better known as attorneys in fact okay so it gives there are other definitions but those are the key terms in the definitions which is section two of Rufus okay and then section four deals with user direction of digital assets so excuse me users can specify a access to their digital assets through first of all the online tools provided by service providers so I've talked about this
28:21 previously on shows about digital assets okay talked about Facebook Legacy and and that sort of thing okay but roffa goes further than that it also specifies that access can be granted in a will or a trust or a power of attorney and it can specify who can have access to digital accounts okay so um if you have in your will that your executive May access all of your digital
28:57 accounts so then under roffa your your executive will have access however and here's here's a big however okay also in section four of rufida it says if both exist okay so if you've given uh Direction on using online tools of a particular custodian and you've given directions under uh under a will or a trust okay the online tools will take priority over
29:36 legal documents okay so so you know you need to be careful um you know to make sure which which are you going to use okay because the default is going to be the the online tools set up um on on the platforms of the custodians themselves now if what'll happen if if for example in a will you say that my directive in the in my will takes precedent over any
30:12 directives I've I've made using online tools of custodians don't know okay the question occurs to me and I would have to I would have to ask you know a lawyer who understands this law now here in California since the law has been around for less than a year I'm not sure any lawyer is going to know about this so here in California it's going to be new now in a state that where it was adopted back in 2016 maybe there's been cases about that already okay and so if you talk to an
30:47 estate planning attorney or a probate and trust attorney um they will know the answer to that off the top of their head okay but you can see that there's a potential conflict there and so you'll want to deal with it um UPF front Okay um section seven deals with fiduciary access to electronic communications so it says that fiduciaries cannot automatically access emails or private messages unless okay the deceased or incapacity
31:23 person has explicitly consented to consented in a legal document like again will power of attorney Etc or a court has granted a court order has granted access okay now fiduciaries can get a catalog of communications meaning a list of when emails were sent for example but not content okay unless uh users opted out in other words the Privacy um standards of email providers do not
31:58 permit um a fiduciary to get the content of emails um outside of uh a court order granting access or there being an an explicit provision to Grant said access um in in a legal document okay next uh court and custodian procedures sections 8 through 10 okay so um fiduciaries can request access um they can provide a written request and it can include a death certificate or a
32:34 court order to a custodian okay or they can show authorization I.E in a will or a trust or in a power of attorney that the the deceased user or the incapacitated user uh has granted them access in a legal document okay now custodian um uh custodians they can deny a request if it's not properly authorized um so for example let's say that um I'm I am administrating an
33:10 estate and and I don't and there is no will granting me uh specific Authority and I don't have court order I can submit a request with a copy of the of the death certificate and a copy of my um letters of uh Administration but a custodian according it seems to me according to rufida could say sorry there's no explicit authorization for you to have access to let's say uh the the person's YouTube
33:45 account and so until you get um a court order specifically addressing this issue we're going to deny you access that that appears to me to be uh the you know the plain text of of of of the of rufida okay um now they may also require additional proof um or limit access they like like again they may give you a a a catalog of communications meaning a list of emails without their content things like that
34:20 okay finally compliance and custodian protection which is sections 13 and 14 so uh s Ser service providers are protected from liability if they comply with rufida so let's say that um I'll use the same example let's say I've been appointed the administrator of an estate and I get a a court order specifically granting me access to digital assets okay and I submit that to a custodian let's use Google again to get control of
34:57 a of a you of a YouTube account okay and there's let's say there's no um uh platform pafic specific um uh guidance as to how the The decedent Wanted their you know YouTube account um uh you know handled once they passed away okay so uh it would appear then that if Google which owns YouTube grants me access to that YouTube account that that was done properly in
35:33 compliance with rufida and so then if uh let's say one of the beneficiaries or Heirs of the decedent didn't like my having access to it they might try and Sue the service provider you know because obviously Google has tons of money okay and and Google would be protected because they've complied with the the the standards in rufida okay okay um now uh fiduciaries still must comply with federal laws like the stored Communications act okay when requesting access and finally um custodians can
36:11 charge fees for providing access um and they may refuse overly burdensome requests okay so uh you know again this is a legal issue what constitutes an overly burdensome request would um you know send me a copy of all emails for the last you know 30 years being an overly burdensome request I don't know may if there were only five emails during that 30 years maybe not if there were 500,000 seems like that might be overly burden some again these are legal
36:46 questions and and they need to be addressed to a lawyer who who knows um the answer to these um you know who who who who is familiar with this particular law so what what to do well first of all when if if you know if you've already done your estate planning but you haven't addressed this issue I would recommend that you get in touch with the lawyer who helped you with your estate plan and review this issue okay
37:21 especially if you're in a state like California where it was or um was what was the other one Oklahoma uh where the the law was just adopted last year that has changed the game okay and so it may be that you need to amend your trust or put a ctisle on your will uh granting your trustee or your executive Authority Under roffa to access digital assets okay um but but this is this is something for you to
37:56 discuss with your estate planning team uh to make sure that you're getting the proper advice for your particular situation okay so and and that is my advice to you is is is get in touch with your with your lawyer or with your um your your team of advisors and and ask the question okay there's there's it's it's always good to ask the question and my my experience dealing with the state planning attorneys is
38:31 that they never mind they're never bothered by a question being asked better for the question to be asked and and then they can address it quickly if it's not something you need to be concerned about okay or um if if it is something you that you do need to be concerned about then it can be addressed and it's be better to address it in the estate planning uh process than waiting for for the estate Administration process it's going to take more time cost more money is more likely to create a dispute because now your explicit
39:09 wishes are not clear and so it gives uh it creates the the environment where competing interests can dispute over it and cause a problem okay so uh now if if you're if if you're acting as an executive or you're acting as a trustee and and the person is already deceased or if you're acting under a durable power of attorney and the person is already incapacitated again I I can't recommend strongly enough that you get in touch
39:44 with the lawyer who's advising you and make sure that you are in compliance okay with with rufida and not only rufida with the federal laws I mentioned including the stored Communications act and what was the other one I'm going up on it the Computer Fraud and Abuse Act okay um make you know while it may not seem like a big deal to get to to access you know bank accounts and such online um it potentially you know could
40:20 be all right so um this is something that you want to get competent legal advice viice about address it in the estate planning process if at all Poss you know if if if it's still if there's still time to do that and if not make sure that you are handling these issues correctly as as a fiduciary okay whether you're a professional like me or whether you're a person acting in a fiduciary capacity okay so that's our topic for today um maybe a little bit technical uh
40:58 but uh you know if it keeps you out of a dispute with with your with your relatives your siblings or whatever it's it's well worth the time and consideration to to delve into it and again I will put a link to the ulc uh web page dealing with rufida so that uh you you can look into it uh more thoroughly and if you are if you do uh think you need to contact your lawyer about or to your estate planning team about it you can include the link in in your email to
41:34 them and say Hey you know I saw this this show that uh you know Kevin you have to say my name but I saw this show this podcast um that talked about this thing and um here's a link to it um is this something that I that you know requires revising of my estate plan and that way your you know your your lawyer will have the information right in front of him and he doesn't have to go searching around Roff what the heck is that okay all right so that's what I have for you today appreciate you tuning in uh lamon good to see you my friend um
42:11 all always great to see you and and the other people who are watching live always thank you very much for doing so uh so if you have any uh thoughts comments criticisms my um uh uh U social media links will be uh in the show notes feel free to post those if it's uh if you have something of a private nature my email address will be there as well you can always email me with of course the Proviso that if it's not something specifically in my area of professional
42:46 expertise um I I will be happy to refer you to someone but um if it's out of my area of professional expertise like it's a legal matter or an accounting matter something like that um I I I will not answer it but I will be happy to uh connect you with someone who who hopefully can all right tomorrow at uh Tuesday 10: amm Pacific time is my show business lessons from the military I'm G to be talking about uh one of the well he's really considered the greatest Admiral in
43:22 British history Horatio Nelson and our topic is navigating chaos which is certainly something that uh any any sailor has some experience doing and then on Wednesday at 10: am Pacific time is my show people making money and it's our monthly economic Echoes we're going to look at the uh economic data for the previous month and see what that means for us um we are in a a somewhat economically uh turbulent time right now
43:59 and so I think it's it's important for us to uh look at the data and make an assessment how it affects us as individuals rather than just you know what's what's going on you know throughout the country so that's people making money 10: amm Wednesday uh economic Echoes and then seven days from today I'll be back for the next edition of uh trusts and Estates weekly and let's see I think think I have a guest do I nope nope no guest so I just wanted to double check that so once again thank
44:34 you so much for joining me it's always a great way to start off the week wishing you a wonderful rest of the day and signing off as I always do Marie darling you are my bell courage at all times my friends