By: Lauren M. Ahern
On September 13, 2017, Governor Chris Christie signed into law New Jersey Assembly Bill A-3433, otherwise known as the Uniform Fiduciary Access to Digital Assets Act (“UFADAA”). The Act becomes effective ninety days after the Governor’s enactment and applies to those persons who are residents of the State of New Jersey or who resided in the State of New Jersey at the time of their death. The Act permits certain fiduciaries to access the “digital assets” of the user for whose estate the fiduciary is administering.
The Act defines “digital assets” 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.” The term “fiduciary” as used in the Act is defined as “…an original, additional, or successor personal representative, guardian, agent, or trustee.”
The Act permits a user (who, in practical application, will be a decedent, the ward of a legal Guardian, the Principal of a grant of authority under a Power of Attorney, or a settlor or beneficiary of a Trust) to direct a custodian of a digital asset (for example, an email provider) either through the use of a custodian provided online tool or through a Will, Trust, Power of Attorney, or other similar record, to disclose or not to disclose to a designated recipient some or all of the user’s digital assets, including the content of electronic communications.
A fiduciary can gain access to the content of a user’s electronic communications (such as email) via express consent by the user in their Will, Power of Attorney, Trust Agreement, or similar writing, or by Court Order. A fiduciary can gain access to a catalogue of electronic communications sent or received by the user and digital assets, other than the content of electronic communications, if the user has not prohibited such disclosure or if the Courts have not directed otherwise. The fiduciary is obligated to maintain a duty of loyalty, care, and confidentiality in the management of a user’s digital assets and, among other restrictions, may not use his or her authority to impersonate the user.
The adoption in New Jersey of UFADAA is an important step in recognizing the significance of the use of technology in our everyday lives and modernizing the administration of estates in this State. Individuals and practitioners would be wise to include a discussion about the administration of digital assets as part of their broader estate planning conversations, and adopt language granting, restricting, or prohibiting access by a fiduciary to digital assets as appropriate.
For more information or if you have any questions about the New Jersey estate tax, please contact Judson M. Stein, Chair of the Trusts & Estates Practice Group, at 973-230-2080 or firstname.lastname@example.org or Lauren M. Ahern, Associate in the Trusts & Estates Practice Group.
Tags: Asset Protection • genova burns • Trusts & Estates • New Jersey • GENOVA BURNS LLC • JUDSON M. STEIN • Lauren M. Ahern • Uniform Fiduciary Access to Digital Assets Act • Digital Assets Act • UFADAA