Taking Digital Assets to the Grave

What happens to my data and digital assets when I die?

You may be wondering what a digital asset is, if you even have any digital assets and if this topic is relevant to you at all. Well, if you were born after 1940, then you most probably have digital assets that will form part of your digital estate and you need to consider what will happen to them on your death.

End of life plans for your digital estate can be complicated as they are often intangible, have jurisdictional issues and there is no specific law in Australia that applies to a person’s digital assets when they die or that gives access rights to your executor or administrator to deal with those assets. If you die without leaving the required password and login details, then your digital assets may die when you die or may remain online indefinitely. Therefore, it is important to consider your digital assets when preparing your estate planning.

Do I have any digital assets?

Our lives are becoming increasingly digitalised and online. The wealth held in digital assets (sometimes called ‘digital wealth’) constitutes a much greater proportion of a person’s estate than many people realise.

Nowadays, it is not uncommon for people to communicate, pay, transfer, shop, do business, share, play and earn online so digital planning is becoming increasingly important.

If you have a social media account such as LinkedIn, Twitter, Facebook, Instagram, WhatsApp, Snapchat then you have digital assets. If you store photos and videos online, use online banking, have rewards cards or accounts such as frequent flyers, have an email account, hold cryptocurrency, or have subscriptions then you own digital assets.

So, what happens to my digital assets when I die?

A frightening percentage of Australians do not have a Will, and of those that do have a Will, an even smaller percentage have accounted for their digital assets in their estate planning documents.

Many people have not thought about what happens to their email and social media accounts such as Facebook or Instagram when they die.  What about photos, online accounts, cryptocurrency? If your legal representative is not able to access the digital asset, then it may be lost forever.

Subscriptions or accounts that hold sentimental value as they hold photos, memories or messages related to the deceased may be difficult to access if limited information and access rights are given to your executor.

Many online platforms have policies and procedures regarding what happens to accounts when someone has died. Below are some popular platforms and details on how they deal with the death of a platform user:

1. PayPal: only a PayPal account owner can close their account unless the owner dies. It is dealt with in a similar manner to a bank account.
2. Digital and cloud-based files: most cloud solutions are subscription based and your files may be deleted when you die if payments stop. Options to access the cloud information and materials may be for your executor to take on the billing and keeping the account active.
3. Facebook grants users a license that is non-exclusive, worldwide, royalty-free, sub-licensable and transferable. Facebook allows a user to nominate, if they want, for their account to be memorialised or permanently deleted if they die. A Facebook user can nominate a Legacy Contact and give them permission to download an archive of photos and profile information. However, private messages remain confidential.
4. Instagram, like Facebook, allows users to nominate a contact to memorialise their account if they die. A memorialised account cannot be logged into by anyone else or altered. The content is only visible to the audience that the user already had, and not to the public. People can also post to the deceased person’s account.
5. Cryptocurrency: A decentralised digital currency with no physical bank or branch where trading between users is direct and anonymous. Access required via a Password/key to digital wallet meaning if this is lost then so is the cryptocurrency asset.
6. Qantas frequent flyers: according to the Qantas terms and conditions, membership automatically terminates on the death of a Member and any Qantas points not redeemed or transferred prior to death will be cancelled.
7. Velocity frequent flyer: Virgin Velocity terms and conditions permit the executors or administrators of a deceased Member’s estate to transfer unredeemed points to another membership account or redeem the points within 12 months after the Member’s death. If not transferred or redeemed within this timeframe then all unredeemed points will be forfeited.

How do I deal with digital assets in my estate plan?

There are a couple of things you can do and points to consider when planning on what happens to your digital assets when you die. These include:

1. Identify what digital assets you currently ‘own’ and the nature of your ownerships as these could include:
   1. access rights
   2. intellectual property
   3. the account itself
   4. mere subscription
   5. the data
   6. a licence to use an online service, platform or piece of software which ends when you die such as some e-subscriptions and magazines.
2. Once you have identified the digital asset, you need to find out where it is saved or stored such as on a digital device (e.g. iPad) or in the cloud which will have the provider’s account terms and contractual rights.
3. Is it governed by Australian Law or foreign jurisdictions? You may need to review the terms and conditions of the agreement that the account user signed as many providers are based overseas.
4. Research digital wallets and storage facilities for things such as passwords, login details, account details and any other information that may be needed to access or gain control of the digital asset
5. Keep a secure and up-to-date list of digital assets and accounts and ensure you inform the person you would like to manage your estate upon your death knows where and how to access this information.
6. There are no one-plan fits all and it is important you put time and careful consideration to what happens to your digital assets when you die.

How can Lynn & Brown Lawyers help me plan for what happens to my digital assets when I die?

A well-drafted estate and succession plan that includes your digital assets and properly considers what will happen to your digital assets when you die will ensure smooth management of your estate in accordance with your wishes, give your executor or administrator clear guidance and avoid unnecessary stress for family members.

Further, clear instructions on how you want your digital assets managed and how they can be accessed by your executor is crucial to protecting your digital assets.

Digital wealth forms part of a person’s estate which needs to be considered as part of their overall estate planning strategy to ensure their digital assets and other assets are dealt with in a tax effective and asset protective manner.

At Lynn & Brown Lawyers, our Estates lawyers and Commercial lawyers can together help you strategize and prepare comprehensive estate planning documents that deal with all your assets, digital and non-digital.

About the Author: This article has be co-authored by Hannah Scallan and Steven Brown.  Hannah is a graduate of both the University of Western Australia and Notre Dame University, having completed a Bachelor of Arts (major in ‘Law and Society’’ and minors in History and Psychology) in 2016 and a Bachelor of Laws in 2018. She completed a Graduate Diploma of Legal Practice with the College of Law in 2019 and she was awarded the 2019 PLT Property Practice Award. In December 2019, Hannah was admitted to practice in the Supreme Court of Western Australia. Steven is a Perth lawyer and director, and has over 20 years’ experience in legal practice and practices in commercial law, dispute resolution and estate planning.