Pennsylvania Governor Tom Wolf signed Senate Bill 320, now Act 72 of 2020, into law on July 23, 2020, which adopts a version of the Uniform Law Commission’s model legislation, the Revised Uniform Fiduciary Access to Digital Assets Act (“RUFADAA”). Act 72 adds a new Chapter 39 to the Probate Estates and Fiduciaries Code (“PEF Code”). 20 Pa. C.S. §§3901 et seq. It also adds a new subpart to §711 of the PEF Code, regarding the mandatory exercise of jurisdiction through the orphans’ court division by stating that all matters pertaining to Chapter 39 are within its jurisdiction. 20 Pa. C.S. §711 (23). Finally, it adds a new “hot power” provision to Pennsylvania’s general power of attorney law under §5601.4 of the PEF Code by providing that an agent may access the electronic communications and digital assets of the principal only if the power of attorney expressly grants the agent the authority to do so. 20 Pa. C.S. §5601.4 (a) (9).
A version of RUFADAA has been enacted in almost every State. The legislation in Pennsylvania took years of effort and persistence by its sponsor, Senator Tom Killion, and other interested parties. This article is intended to provide highlights of this new legislation. For discussion purposes, all references are to RUFADAA, rather than the particular section adopting RUFADAA in new chapter 39, unless otherwise noted.
Chapter 39 outlines the legal authority of a fiduciary to access a person’s digital assets and accounts, such as photos, books, videos, documents, electronic communications, loyalty program rewards, social media accounts, monetized digital assets, and other digital interests and accounts governed by Terms of Service Agreements (“TOSAs”). The digital age has brought changes in consumer habits and the adoption and expansion of new classes of digital assets and emerging technologies even before COVID-19 accelerated and increased the world’s reliance on digital communications and online activities to conduct personal and business affairs. Prior to RUFADAA, accessing electronic communications and accounts or information stored digitally was chiefly controlled by two federal laws, the Electronic Communications Privacy Act, which encompasses the Stored Communications Act (“SCA”) and the Computer Fraud and Abuse Act (“CFA”). The SCA protects privacy of a user and restricts accessibility to contents of files stored by service providers and records held about subscribers. The CFA penalizes unlawful access to computers and data without proper authorization from the user. Both laws are silent in connection with a fiduciary’s legal authority to access a user’s digital assets, accounts, and information.
Chapter 39 addresses access to digital assets by four types of fiduciaries: an agent under a power of attorney, a personal representative of a decedent’s estate, a trustee of a trust, and a guardian of an incapacitated person’s estate. Gaining lawful access by a fiduciary to an individual’s digital footprint is crucial because each day people are acquiring more digital assets and accounts. Digital assets are defined under RUFADAA as, “an electronic record in which an individual has a right or interest. The term does not include an underlying asset or liability unless the asset or liability is itself an electronic record.” Digital assets may hold sentimental value, monetary value, personal information, or a combination of the foregoing, and must be dealt with in lifetime planning and also in the context of an estate administration to ensure the assets and information are preserved and transferred to the intended recipient or deleted. However, not all digital assets are capable of being transferred, as some grant a user only a lifetime license in the asset, such as ITunes.
RUFADAA establishes a three-tiered hierarchy in establishing priorities under its default rules for accessing an individual’s digital assets and content of electronic communications by a fiduciary that are governed by a TOSA. The first priority is given to the person named by the user in an online tool (called a “designated recipient” under RUFADAA). An online tool, under RUFADAA, “is an electronic service provided by a custodian that allows the user, in an agreement distinct from the TOSA to provide for the disclosure or nondisclosure of digital assets to a third person.” It is similar in many ways to a beneficiary designation on a traditional asset. Currently, not many service providers offer this option, but this may change over time. As of this writing, two popular service providers, Facebook and Google, utilize an online tool on their platforms. The second priority is given to the person authorized by the user in his or her estate planning documents (power of attorney, will, trust, or other record). Of course, the user may either authorize or prohibit a fiduciary or designated recipient from accessing some or all of the RUFADAA, CONTINUEDdigital assets of the user. Finally, if there is no other direction, the TOSA will apply, but if the TOSA does not address fiduciary access to digital assets, the default rules apply as noted in the Comment to RUFADAA.
Gaining entry to the local content of an individual’s computer and any other electronic device by a fiduciary is permitted under RUFADAA, so long as such access is not otherwise unlawful. Even if there is no express direction by the user, a fiduciary still may be able to receive limited information pertaining to other digital assets by bringing a court action to compel the service provider to release such information if certain conditions are established. However, court actions are expensive, time consuming, and may not ultimately be fruitful. Planning to avoid litigation and address digital assets, electronic communications, and access thereto is the best practice.
Senator Killion and the working group dedicated to propel RUFADAA into law, gathered with key stakeholders such as Amazon, Google, Apple, the Pennsylvania Bar Association, the Pennsylvania Bankers Association, and the Uniform Law Commission (“ULC”) to assist in adding some savvy provisions intended to streamline certain estate administration functions in connection with accessing digital assets and the catalog of electronic communications, which may require a court order under RUFADAA if requested by the service provider. 20 Pa. C.S. §3908 differs from its counterpart in RUFADAA by providing that the issuance of letters testamentary or letters of administration by the register of wills will have the same force and effect as a finding of the court for purposes of this section if the personal representative files an affidavit with the register of wills setting forth certain information required by the section (for example, the user’s email address, evidence linking it to the decedent, and a statement that the disclosure of the digital assets is reasonably necessary for the estate’s administration). 20 Pa. C.S. §3908. It is anticipated that counsel will prepare such an affidavit to accompany the filing of the petition for grant of letters.
By contrast to §3908, the requirements in RUFADAA for access to the content of a person’s electronic communications are more detailed and may require a court order if requested by the service provider. 20 Pa. C.S. §3907. The root of these requirements is the industry’s concern about not violating the deceased user’s expectation of privacy concerning content of electronic communications as provided under the SCA above noted.
There is still some time to become familiar with Act 72, as it is effective 180 days after enactment, or January 19, 2021. The provisions regarding the new “hot power” in § 5601.4(a) (9) apply to powers of attorney executed on or after January 19, 2021.
While Pennsylvania may be one of the last jurisdictions to enact a version of RUFADAA, sometimes the best is saved for last, as the unique and nuanced provisions built into the statute regarding accessing catalogs of electronic communications of a decedent should help to increase estate administration efficiencies, but should not be relied upon as a substitute for proper planning.
This article was published in the October 2020 edition of Probate and Trust Law Section Newsletter by the Section on Probate and Trust Law of the Philadelphia Bar Association. The article was written by Jennifer L. Zegel, Esquire and Karen A. Fahrner, Esquire.