Overview of North Carolina’s Digital Assets Act
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North Carolina Governor Pat McCrory signed a bill into law in June 2016 that allows digital account holders to provide a fiduciary with authority to manage their digital assets. The Revised Uniform Fiduciary Access to Digital Assets Act governs authority of fiduciaries to oversee the transfer, maintenance, or disposition of another party’s electronic communications and other digital assets.
Under the new law, an attorney-in-fact may be granted authority under a power of attorney to manage the principal’s digital assets should the principal become incapacitated. Likewise, authority may be provided to an executor under a will or trustee of a trust to manage the decedent’s digital assets. The new law also extends to powers granted to guardians of incompetent individuals, and trustees managing trusts holding digital assets.
The Act modifies various provisions of North Carolina statutes to conform to the new law, including the North Carolina power of attorney form. A new section was added to the power of attorney template to allow the principal to grant an attorney-in-fact the authority to “obtain, request, and authorize disclosure of digital assets.”
While the provisions allow an account holder to grant a fiduciary authority to access digital assets, they limit the extent of a fiduciary’s access where a decedent failed to provide explicit instructions. For example, a fiduciary may be permitted to access the decedent’s email account, but may only read the to/from fields and subject lines if the account holder did not specifically grant the authority to access the asset via an online tool or in a will, durable power of attorney, or other record. In contrast, a fiduciary that is granted such authority may not only view the to/from fields, but may open emails and read the content of communications.
Three years ago, lawmakers debated proposed amendments to North Carolina law to provide fiduciary access to digital assets, but the provisions were removed just before the bill was passed into law. It was not until May 2016 that the proposed changes were reintroduced to the Senate. The Act became effective June 30, 2016.
The Act modernizes North Carolina law and addresses the growing digital properties individuals maintain that are left behind upon death. Previously, outdated legislation provided no direction for executors over electronic communications that were part of an estate.
Today, the value of online assets can be significant. McAfee, the digital security giant, conducted a worldwide study in 2011 that found the average consumer values their online assets at approximately $35,000. However, in the United States, consumers valued their assets at almost $55,000. Executors must document and inventory all of a decedent’s assets. Identifying and accessing digital accounts is imperative for executors to carry out their duties. Now that the Act has passed, North Carolina executors have additional guidance when administering estates.
North Carolina Governor Pat McCrory signed a bill into law in June 2016 that allows digital account holders to provide a fiduciary with authority to manage their digital assets. The Revised Uniform Fiduciary Access to Digital Assets Act governs authority of fiduciaries to oversee the transfer, maintenance, or disposition of another party’s electronic communications and other digital assets.
Under the new law, an attorney-in-fact may be granted authority under a power of attorney to manage the principal’s digital assets should the principal become incapacitated. Likewise, authority may be provided to an executor under a will or trustee of a trust to manage the decedent’s digital assets. The new law also extends to powers granted to guardians of incompetent individuals, and trustees managing trusts holding digital assets.
The Act modifies various provisions of North Carolina statutes to conform to the new law, including the North Carolina power of attorney form. A new section was added to the power of attorney template to allow the principal to grant an attorney-in-fact the authority to “obtain, request, and authorize disclosure of digital assets.”
While the provisions allow an account holder to grant a fiduciary authority to access digital assets, they limit the extent of a fiduciary’s access where a decedent failed to provide explicit instructions. For example, a fiduciary may be permitted to access the decedent’s email account, but may only read the to/from fields and subject lines if the account holder did not specifically grant the authority to access the asset via an online tool or in a will, durable power of attorney, or other record. In contrast, a fiduciary that is granted such authority may not only view the to/from fields, but may open emails and read the content of communications.
Three years ago, lawmakers debated proposed amendments to North Carolina law to provide fiduciary access to digital assets, but the provisions were removed just before the bill was passed into law. It was not until May 2016 that the proposed changes were reintroduced to the Senate. The Act became effective June 30, 2016.
The Act modernizes North Carolina law and addresses the growing digital properties individuals maintain that are left behind upon death. Previously, outdated legislation provided no direction for executors over electronic communications that were part of an estate.
Today, the value of online assets can be significant. McAfee, the digital security giant, conducted a worldwide study in 2011 that found the average consumer values their online assets at approximately $35,000. However, in the United States, consumers valued their assets at almost $55,000. Executors must document and inventory all of a decedent’s assets. Identifying and accessing digital accounts is imperative for executors to carry out their duties. Now that the Act has passed, North Carolina executors have additional guidance when administering estates.
