Digital Estate Planning Articles

The Nebraska Revised Uniform Fiduciary Access to Digital Assets Act

Michael G. Kuzma, Esq.

On April 19, 2016, Governor Rickets approved Legislative Bill 829.  This bill adopted the Revised Uniform Fiduciary Access to Digital Assets Act (2015) (RUFADAA), and will go into effect on January 1, 2017. Very simply, Nebraska’s RUFADAA provides the legal structure for a fiduciary to manage the digital assets of a decedent in the probate process. Prior to the passage of RUFADAA in Nebraska, digital property (like Facebook, Twitter, and Instagram accounts) and electronic communications (like email accounts) were governed by terms-of-service agreements between the user and the custodian[1] instead of property law.  At the same time, these online services must comply with a federal privacy law regarding disclosure of electronic communications.[2]

This arrangement created problems when Internet users died as the fiduciary of the estate lost the ability to manage the digital assets of the account owner. But now under the RUFADAA, users can assign a fiduciary to manage their digital assets after their death and rest assured that their digital wishes are fulfilled. Internet users now have the power to incorporate plans to manage their digital assets in an estate plan, will, or trust, just like they can with their tangible property. This article addresses the practical application of RUFADAA under Nebraska estate, trust, and probate law.

Overview of RUFADAA

A fiduciary is a person who has the legal authority to manage another’s property, and has the duty to act in a person’s best interests. In an estate administration / probate context, the personal representative (also known as an executor in other states) or trustee acts as the fiduciary of the property of the decedent.  Traditionally, a fiduciary only had authority over another person’s tangible property, but now, under the RUFADAA, a fiduciary’s power has been extended to include management of another person’s digital assets, which are broadly defined as a person’s digital property and electronic communications.  The RUFADAA gives fiduciaries the opportunity to manage a deceased user’s digital property such as: online accounts, computer files, web domains, and virtual currency, as well as their electronic communications like: email, text messages, and social media accounts.

Who RUFADAA Applies To

The RUFADAA acknowledges four types of fiduciaries that have the power to access the deceased user’s digital assets:

  • Personal representatives (also known as executors in other states);
  • Conservators;
  • Agents acting in pursuant to a power of attorney; and
  • The RUFADAA also applies to a custodian if the user resides in Nebraska or resided in Nebraska at the time of the user’s death.  However, the RUFADAA does not apply to a digital asset of an employer used by an employee in the ordinary course of the employer’s business.

 

This statute distinguishes the authority of fiduciaries from any other efforts to access the digital assets.  Therefore, if someone is not a fiduciary to the decedent, they will not be subject to RUFADAA.  Family, friends, and others will be subject to other laws not covered by RUFADAA in order to get access to the deceased user’s digital assets.  This provides clients with the choice to appoint someone the fiduciary of their digital assets after death, by appointing a fiduciary or withholding the power.

How to Disclose Digital Assets

Neb. Rev. Stat. § 30-504 explains how the user can get the custodian to disclose digital assets, which digital assets the user wants the custodian to disclose, and how much of the digital property and electronic communication to disclose to the designated recipient.

Section 30-504 provides that any online tools where the user directs a custodian to disclose digital assets will take precedence over any will, trust, power of attorney, or other record that conflicts with it.  If there is no online tool, then the user may use a will, trust, power of attorney, or other record to have the custodian disclose digital assets to a fiduciary. Any online tool, will, trust, power of attorney, or other record will always prevail over any terms-of-service agreement. The estate and trust lawyers of Johnson Flodman Guenzel & Widger have engaged Directive Communications Services (DCS) to add cutting edge digital estate planning service to the firm.

DCS has RUFADAA compliant software that helps in the estate planning process by organizing, and managing a client’s personal accounts and their directives on digital assets.  Using this software, clients can add and update accounts and directives during their lifetime.  After the passing of the client, DCS handles the notification distribution of the estate’s digital assets under RUFADAA.  Familiar with the custodian requirements and protocols, DCS doesn’t collect or store account passwords, credit card expiration dates, CVVs and other security related data.  The attorneys of JFGW are excited to offer this cutting edge digital estate planning tool to clients starting in 2017.

Examining how this digital assets access rule works, Neb. Rev. Stat. § 30-504 states that when using an online tool (such as DCS), will, trust, power of attorney, or other record, the user can determine what digital assets and how much of those assets the fiduciary can see.  For example, say a user wants a fiduciary to have all of their digital property, but does not want the fiduciary to see any of their text messages or conversations they had on Facebook.  Under this section of the RUFADAA, this level of estate planning over digital assets is now possible.

 

How the Custodian Can Discloses Digital Assets

Neb. Rev. Stat. § 30-506 outlines the procedure for disclosing digital assets and gives the custodian discretion over what to disclose.  In general, without input from the digital asset owner, discretion for the manner of disclosure remains in the hands of the custodian. Section 30-506 states in relevant part:

(a) When disclosing digital assets of a user under the Revised Uniform Fiduciary Access to Digital Assets Act (2015), the custodian may at its sole discretion:

(1) grant a fiduciary or designated recipient full access to the user’s account;

(2) grant a fiduciary or designated recipient partial access to the user’s account sufficient to perform the tasks with which the fiduciary or designated recipient is charged; or

(3) provide a fiduciary or designated recipient a copy in a record of any digital asset that, on the date the custodian received the request for disclosure, the user could have accessed if the user were alive and had full capacity and access to the account.

How to Get Electronic Communications of Deceased User

Neb. Rev. Stat. § 30-507 lists what a fiduciary can give to the custodian in order for the custodian to disclose the deceased user’s electronic communications.  In general, if the decedent used a qualified online tool such as DCS in their estate plan, the disclosures are no greater than that of an ordinary probate estate. Pursuant to Neb. Rev. Stat. § 30-507, the documentation requires includes:

(1) a written request for disclosure in physical or electronic form;

(2) a certified copy of the death certificate of the user;

(3) a certified copy of the letter of appointment of the representative or a small-estate affidavit or court order; and

(4) unless the user provided direction using an online tool, a copy of the user’s will, trust, power of attorney, or other record evidencing the user’s consent to disclosure of the content of electronic communications.

 

Citations:

[1] In this situation, the custodian is a person that carries, maintains, processes, receives, or stores a digital asset of the user (i.e., Facebook, Google, Yahoo!, etc.).

[2] 18 USC § 2702 (2011).