June 18, 2014

Death in the Virtual Age


By Douglas Cushing

February 2013

While many things can be done "virtually" today, death and dying, unfortunately, remain very real. In today's online world, when planning for one's estate one must now consider virtual consequences. Who gets the iTunes library? Who may be liable for unlawful downloading? Who has access to the Facebook photos or YouTube videos? Perhaps more critically, what are the passwords necessary to access paperless financial accounts that exist only electronically — some only in the Internet cloud?

Legislators in many states, though not currently Oregon, are wrestling with these issues. In the case of digital entertainment, agreements with Apple, Amazon, or other providers are generally "use agreements." As a result there is a question of whether anyone can take over the library. Without a specific provision in the will or trust, or perhaps joint ownership, the rights to these assets may be terminated. If the music and movies in the library were illegally downloaded, there could be a liability to copyright holders. Recording industry associations primarily target customers of older peer-to-peer networks, so that may be a diminishing risk, but potential liability remains real. Before scheduling the decedent's digital entertainment library as a large asset on the probate inventory, the personal representative should verify that a clear will or trust provision governs transfer of the library, and be reasonably assured that all its contents were obtained legally.

Additionally, a decedent's estate may consist of financial and other electronic accounts that are password locked. Without a direct authorization to a third party to have the right of access, the heirs may be unable to obtain those financial records and accounts. Careful estate planning will include login name and password information for all electronic personal accounts that include or affect the estate's assets, whether accounts are stored on one's own computer or online. However, if there are videos or pictures the decedent did not wish specific heirs to see (assume the worst case YouTube videos), it may be best not to give unlimited password and account access to related beneficiaries. There are software programs and applications available and being developed allowing access information to be logged and stored, but without notice to the personal representative, it will be difficult to access the information.

One more controlling aspect of the virtual world may be readily available soon allowing individuals to create one's virtual clone to serve as the trustee or advisor to your trustee. This would assure that your very personal choices as to discretionary distributions, termination of trust benefits, or other decisions by the trustee would embody your own thought processes and biases. Currently, software developers are creating such "predictive programs" to anticipate a wide range of actions — from terrorists' moves to holiday gift sales. Potentially, they will allow the dead to live on to control the future of their financial wealth.

The basic requirement for anyone maintaining either significant media collections or financial assets primarily online with password protected accounts or other online registrations is that they be specifically identified and transferred. Ideally, along with explicit permission/consent for heirs to access them, the personal representative, trustee, or other heirs may make the desired transfer to the next generation, although the service providers and vendors are not necessarily all on one protocol.

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