Dealing with Digital Assets on Death or Incapacitation

Creating a new Facebook account usually leaves us with the incredibly difficult task of selecting just which profile picture is likely to attract the most likes, but thoughts surrounding what might happen to our account (and in turn, our favourite photos) when we either die, or lose capacity aren’t always pressing.  With this said, in today’s digital age, questions surrounding what happens to our digital assets when we pass on have become increasingly worth asking.   

If you are not part of the 2.2+ billion people currently active on Facebook, then you might fall into the 170 million+ strong group of users on Spotify.  Similarly, if you are not digitally connected on that front, then you are still likely to be one of the 3 billion+ people who have a personal email account.  Whatever the case, this type of digital footprint means that you have what are often referred to as ‘digital assets’, and realistically, as a resident of the 21st century, chances are that you’ve created quite a few of them!

What is a ‘Digital Asset’?

The term ‘digital assets’ encompasses everything from photos, emails, domain names and blogs to online gaming accounts.  Essentially any item of media or text that has been formatted into a binary source, of which a person has ownership rights, can be included within the definition (Van Niekerk, 2006) [1].

Now that we have a suitable definition for the term, we can start to look at what actually happens to digital assets upon our death, or incapacity.  Unfortunately, the current short answer is ‘nobody knows’.

As with a range of industries, 21st century law is currently playing a big game of tag, with continuous and significant changes in technology meaning that legislation across all areas of the law are struggling to keep up.  With regard to the legalities surrounding digital assets, however, Australia hasn’t even come to the table.  Whilst there are a number of laws that may be relevant to digital assets, at present, there is no law in Australia that directly addresses access to digital assets upon death or incapacity.

Given the fact that digital assets can often have great personal, sentimental and/or financial value, issues arising from uncertainties within the current state of law are starting to surface.  For example, when 29 year old Edward Drummond-Baxter was killed during his first deployment to Afghanistan, his Facebook account continued to live on.  Whilst his sister was able to gain access to his account by providing both Edward’s death certificate and newspaper clippings evidencing his death, Google refused to reveal his email password for privacy reasons pursuant to their end user licence agreement (EULA).
It isn’t just Google, though.  Companies such as Yahoo! and Facebook also have EULA’s that don’t allow for a fiduciary, such as an attorney or executor to deal with digital assets.

For example, Facebook’s EULA states, “you will not share your password…let anyone else access your account, or do anything else that might jeopardize the security of your account”.  They go further to say that, “if you violate the letter or spirit of this Statement…Facebook can stop providing all or part of Facebook to you”.  Based on this information, if you were to provide your account details to a fiduciary to help plan for your death, Facebook would have the right to terminate your account.  This would result in you losing access all of your digital property on that platform, which could amount to a wide range of content and information.

Similarly, Yahoo!’s EULA provides that “you agree that your Yahoo! Account is non-transferable and any rights to your Yahoo! ID or contents within your account terminate upon your death”.  Therefore, upon notifying Yahoo! of a loved one’s death, your fiduciary could lose access to important information stored on your email.

Many people feel confident that by storing information in their email inbox, they are protecting themselves from losing said information.  Similarly, keeping information in an email inbox allows users to gain access wherever they may find internet access.  It is likely the case that nestled in with all of your online shopping confirmation emails are certain bits and pieces which may be useful for your family to have access to (utility bills, financial documents, access to passwords etc.) in the event of your death or incapacitation, so it is easy to understand why having all of your emails deleted could be problematic.

In light of the above, NSW Attorney-General Mark Speakman has asked the NSW Law Reform Commission to review and report on access to digital assets upon death or incapacity in Australia.  It is expected that legislation may be needed in NSW to address the practical difficulties in accessing digital assets of a deceased or incapacitated person.

The newly enacted laws in the United States (Revised Uniform Fiduciary Access to Digital Assets Act [2015]) and Canada (Uniform Access to Digital Assets by Fiduciaries Act [2016]) will be reviewed by the NSW Law Reform Commission when reporting a solution for NSW.

So, what happens in the meantime?  

Until we are able to attain clarity with regard to the succession of our digital assets on death or incapacitation, it is essential that testators obtain advice on how they can best prepare for the succession of their digital assets.  Whilst there is no clear solution at present, measures can be put into place to make the job of those being left behind a little easier.  For example, provisions can be inserted into Wills or Powers of Attorney relating to digital assets, and other proactive measures such as the nomination of a legacy contact on Facebook can be suggested to help you prepare.

If you have a question relating to the above information, or would simply like to speak with someone regarding the protection of your digital assets, please don’t hesitate to get in touch with myself, or anyone else within our Wills & Estate Planning team:

[1] Van Niekerk, A.J. (2006) The Strategic Management of Media Assets; A Methodological Approach. Allied Academies, New Orleans Congress, 2006


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