This Blog was written by: Alicia Godin, Estate and Trust Consultant, Scotiatrust 

Amidst the current landscape, many of us are self-isolating at home and finding ways to entertain ourselves. Often, this means relying more heavily on social media and digital technology. Many of us have adapted our typical business practices and move toward an (even more) paperless society. Planning for digital assets is not a new topic, but during this time of rapidly changing personal and professional practices there may be more pressure to appropriately include digital assets in our conversation around planning and administration.

A comprehensive estate analysis should, in my opinion, include an inventory of assets, values and ownership structures; after all, certain assets are treated differently on death, and have different planning implications. As our reliance on technology deepens, it is increasingly important to consider digital assets. Digital assets may include: domain names, websites, blogs, profiles on social networking sites, crypto-currency and other online content that could be of economic or personal value to the will-maker, his or her family or beneficiaries.

Consider your Facebook, Instagram or Snapchat account – you may have stored or posted photos or videos on such platforms and may not have a physical or digital copy stored elsewhere. Do you want your executors to retain control over these accounts? Do you want a family member or other person to have access instead? Consider also reward points such as Air Miles or Shoppers Optimum Points… you may have been accumulating points with a significant value, and which is technically an asset. Indeed, in 2018 Canadians had around $16 billion in unredeemed loyalty points![1]

Your Executor (also known as Estate Trustee) is essentially manager of your estate and has the obligation to deal with the administration of your estate; primarily, the payment of your debts, taxes and funeral expenses, and the distribution of your estate among your beneficiaries according to the terms of your Last Will and Testament.

In a paper focused environment, it is a slightly less onerous task for an executor to track down bills, subscriptions, and accounts via the paper record. In the digital age, it can be increasingly challenging for a lay-executor to ensure that they have accessed and discovered our digital records and assets. Every provider, platform or rewards program has its own rule about whether access or ownership rights can be transferred on the death of an owner, and whether they can be dealt with by the executors, especially if not specifically gifted.

In Canada, no province or territory has enacted executor access laws yet, despite several cases where executor access was brought before the Courts.[2] According to Facebook, Canadians are the most active users in the world, with over 19 million users and 300 million photo uploads per day.[3] In the United States, most states have enacted digital access laws requiring the will-maker to provide direction and permission in advance to his or her executor or personal representative.

Nevertheless, the general duties and obligations of an executor/estate trustee remain the same (for digital or physical assets):

1. Identify the assets;
2. Gain access;
3. Secure the assets (in a digital age, this may include backing up accounts, sites, changing passwords or usernames);
4. Inventory the assets;
5. Determine asset and date of death values;
6. Arrange for the transfer or disposition of items of a personal or sentimental value (photos or videos for example);
7. Protect personal information;
8. Assess liabilities; and
9. Close (or transfer) accounts.[4]

Although the role of the executor remains the same, our ever-increasing reliance on technology and digital assets, and the uncertainty in the law applicable to these digital assets, can make the actual administration of the estate an even more challenging task.

Planning for the administration of digital assets presents unique challenges for executors, administrators, as well as lawyers, and requires novel strategies as the law and user-awareness matures.

[1] Bouw, Brenda. “Don’t Forget about Digital Assets in Your Estate Plan” (The Globe and Mail: 24 Sept 2018). Retrieved from: https://www.theglobeandmail.com.

[2] Hartung, S. “Digital Privacy for the Living Dead.” (30 September 2019) Published in Lawyers Daily.

[3] Algonquin College Social Media. “Facebook Stats” Retrieved from: https://www.algonquincollege.com/ac-social-media/facebook-stats/. Accessed 08 April 2020.

[4] Wiland, Richard & Behan, Gordon. “Planning for and Administering Digital Assets” (Clark Wilson LLP) Retrieved from: https://www.cwilson.com.