Today, many assets exist only in an electronic form. These digital assets can result in more complexity when settling a loved one’s estate.

The Role of An Executor or Administrator

The ordinary role of an executor or administrator is to collect the assets of the Decedent and distribute the assets to the beneficiaries of the Decedent’s Estate. This is often done by going through the decedent’s files and mail to uncover the assets he or she possessed. However, due to many assets existing in only electronic form, the estate representative may have a harder job. Not only does he or she need to uncover the asset, but he or she may need to obtain the password to access it. Many internet companies have strict privacy policies, so accessing the digital asset is often difficult.

New York Digital Assets

In New York, Article 13-A of the Estates, Powers, and Trusts Law (EPTL) governs the administration of digital assets. Pursuant to EPTL 13-A-1[i], a digital asset is an “electronic record in which an individual has a right or interest. The term does not include an underlying asset unless it is itself an electronic record”.

Pursuant to EPTL13-a-1(e), the content of electronic communication means the information was:

1. Sent or received by the user;
2. In electronic storage by a custodian that provides an electronic communication service to the public or is carried or maintained by a custodian providing a remote-computing service to the public; and
3. Not readily accessible to the public.

With regard to non-content digital assets, such as a contact list or calendar information, EPTL 13-A-3.2 governs. Pursuant to EPTL 13-A-3.2, the estate representative can access the non-content digital assets if the estate representative provides the custodian with certain documentation, unless the user prohibited disclosure of such assets or a court directs otherwise.

Online Tools

Some custodians offer an online tool that permits a user to provide direction to the custodian regarding the disclosure of his or her digital assets. However, this online tool is not offered by all custodians and sometimes the user does not avail himself or herself of such an online tool. If that is the case, then the custodian may look to the decedent’s Will, Trust, or other agreement before disclosing any information to the estate’s representative.

A Case Study

In Matter of Coleman, a twenty-four (24) year old man passed away unexpectedly without a will. His parents were appointed Co-Administrators of his Estate. After his passing, his parents took possession of his iPhone; however, they were unable to access any information since they did not know his passcode. His mother contacted Apple, Inc. to see if she would be able to obtain any information from her son’s iPhone. The Apple representative informed her that she would not be able to retrieve any information from the iPhone without the passcode; however, if the phone was backed up to the iCloud, then she would be able to obtain information without the passcode. In order for Apple to release any information from the iCloud, a court order would be needed since the decedent did not provide Apple with authorization to disclose the content of his digital assets.

Thereafter, the Co-Administrators of the Estate petitioned the Court seeking an order to have access to their son’s digital assets associated with his iPhone. After analyzing the facts at hand and balancing the decedent’s interests in his not having consented to the disclosure of content of any of these digital assets during his lifetime, the Court found that, at this time, the Petitioners did not demonstrate the need to access the content of the decedent’s digital assets for the administration of his Estate; however, the Petitioners were permitted to have access to the non-content digital assets. Matter of Coleman, 2019 N.Y. Slip. Op. 29067 (Westchester Cnty. Surr. Ct. Mar. 11, 2019).

As you can see, digital assets can be a complex matter when it comes to settling a loved one’s estate. As always, we encourage you to seek counsel and plan ahead accordingly.