Have you thought about what will happen to your digital assets on death?
We rely on computers, mobiles and the internet for so many aspects of our day to day lives. From our social media accounts, to our networking platforms, to our online banking and rewards points. We run businesses, set up utilities, manage our finances and organise our social lives from behind our screens. With so much of our important information online, very few of us (myself included until recently) have thought about what will happen to our assets on death. The reality is, that forgetting to consider what happens to these assets on death could result in your loved ones losing out on both valuable and sentimental digital assets.
Do you actually own any digital assets? The Detail is in the (very) small print
We have all been there - we are setting up a new account up or downloading an app and a box pops up asking us to tick and confirm we have read the pages and pages of terms and conditions. Most of us tick that box without giving it another thought. The terms and conditions are largely non-negotiable, one sided contracts, which most don’t bother to read. However, it is often those terms and conditions that actually determine whether or not we own our digital assets and whether we are able to pass them on to our loved ones on death.
For example, did you know that when you download a song from Itunes, what you are actually paying for is a non-transferable license to listen to that song on a chosen Apple device. Similarly, when you upload photographs to ICloud, you are agreeing that there is ‘no right of survivorship’ and that your account will be deleted on your death. This recently became an issue for a widow who had to fight her way through the English courts for three years to be able to access her husband’s ICloud account after he died. The account was full of sentimental family pictures which she wanted to share with her 10 year old daughter.
It is therefore really important to check the Ts and Cs to make sure that, if there are assets you want to pass on, you are actually able to do so. If you are not, can you think of ways around this? For example downloading photos and storing them somewhere accessible.
What are the legal issues?
No specific legislation
With the legislation governing succession law in Scotland still largely deriving from the 1960s, it is safe to say that it was not drafted with digital assets in mind. There is no specific legislation to tell us what digital assets are, or how they should be dealt with on death. Even if there were, I wonder whether such legislation could ever keep up with the ever evolving technology, forming new kinds of digital assets every day.
Even if there were specific legislation to cover the treatment of digital assets on death, we could have conflicts of law between the law governing where the person died (for example Scotland) and the law governing the terms and conditions contained in the contracts, which is often US Law.
Authority to access
Another issue which many commentators have pointed out is whether executors actually have authority to access a deceased person’s digital assets. Should executors be weary that they are breaking the Computer Misuse Act 1990 which makes it an offence to access a program or data on a computer without authorisation? Furthermore, you may be in breach of the terms and conditions of the service provider if you (a) give your password to a third party or (b) use a third parties’ password to access the service.
Legislation has been passed in the United States which allows an executor to access control and manage a deceased person’s digital assets without breaking any privacy or unauthorised computer access laws. As of yet, no such legislation applies in Scotland at present.
What practical steps can you take to make things easier for your family?
I would recommend that you do the following now, to make things easier for your family.
- Think about what digital assets you have and check the terms and conditions to see if you actually own them and whether you are able to bequeath them on death.
- Make a log of all your digital assets and store it in a safe place which can be easily accessed by your executors/next of kin. Make sure to include online bank accounts, online utility providers, cryptocurrencies, rewards points, access to photos etc. Remember that if you don’t have a paper trail, it is incredibly difficult for your family to know what assets you have.
- Check with the different service providers whether there is anything you can do now to make things easier for your family. For example, on Facebook you can set up a ‘legacy contact’ to manage your account on death. They can post a final message, update your photo and memorialise your account. On Google you can set up your ‘inactive account manager’ which ensures that after a period of inactivity, important information can be sent to someone you trust on death. This could be particularly important if you have a business account.
- Speak to your solicitor about leaving digital assets to beneficiaries under your Will. Make sure your Will gives your executors power to manage your digital assets on death.
- Remember to include any digital assets with financial value when you are estate planning. For example, HMRC has recently produced guidance to remind us that cryptocurrencies are subject to Inheritance Tax just like any other asset that forms part of your estate on death.
- Consider who you want your executors to be and whether there is a tech savy person who would be good at dealing with your digital assets.
- Can you print/download important information so that it is more readily available to those who may need it.
What happens to our digital assets on death is still a bit of a grey area in terms of the law. Indeed it really depends on the individual service provider and their terms and conditions. I hope this will be an area of law which develops over time. In meantime, taking the practical steps outlined above could protect your loved ones from a lot of stress and difficulty in dealing with your digital assets on death.Back to news list