BILL ANALYSIS Ó
AB 691
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CONCURRENCE IN SENATE AMENDMENTS
AB
691 (Calderon)
As Amended June 14, 2016
Majority vote
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|ASSEMBLY: | |(May 11, 2015) |SENATE: |36-1 |(August 1, 2016) |
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(vote not relevant)
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|COMMITTEE VOTE: | |(August 23, |RECOMMENDATION: |concur |
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(Jud.)
Original Committee Reference: JUD.
SUMMARY: Establishes the Revised Uniform Fiduciary Access to
Digital Access Act (RUFADAA) to specify rules for the disclosure
of electronic information from a custodian of a person's digital
assets (custodian) to the personal representative of the estate
of a deceased user (representative) or trustee of the deceased
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user's trust (trustee) for the purpose of administering the
estate or trust.
The Senate amendments delete the Assembly version of this bill,
and instead:
1)Establish the RUFADAA and authorizes a decedent's personal
representative or trustee (fiduciary) to access and manage
digital assets and electronic communications, as specified.
2)Authorize a person to use an online tool to give directions to
the custodian of his/her digital assets regarding the
disclosure of those assets.
3)Specify that, if a person has not used an online tool to give
that direction, he or she may give direction regarding the
disclosure of digital assets in a will, trust, power of
attorney, or other record.
4)Require a custodian, as specified, of the digital assets to
comply with a fiduciary's request for disclosure of digital
assets to terminate an account, except under certain
circumstances, including when the decedent has prohibited this
disclosure using the online tool.
5)Specify that a user's direction through the online tool or
testamentary document would override a contrary provision in a
terms-of-service agreement.
6)Provide that a fiduciary's or designated recipient's access to
digital assets may be modified or eliminated by a user, by
federal law, or by a terms-of-service agreement when the user
has not provided any direction as specified by this bill.
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7)Authorize the custodian, in its sole discretion, to do any of
the following when disclosing the digital assets of a user:
a) Grant the fiduciary or designated recipient full access
to the user's account;
b) Grant the fiduciary or designated recipient partial
access to the user's account sufficient to perform the
tasks with which the fiduciary or designated recipient is
charged; and
c) Provide the fiduciary or designated recipient with a
copy in a record of any digital asset that, on the date the
custodian received the request for disclosure, the user
could have accessed if the user were alive and had full
capacity and access to the account.
8)Authorize a custodian to assess a reasonable administrative
charge for the cost of disclosing digital assets and would not
require a custodian to disclose a digital asset deleted by a
user.
9)Provide that if a user directs or a fiduciary or designated
recipient requests a custodian to disclose some, but not all,
of the user's digital assets, the custodian need not disclose
the assets if segregation of the assets would impose an undue
burden on the custodian.
10)Authorize the custodian, fiduciary, or designated recipient
to petition the court for an order, as specified, if the
custodian believes the direction or request imposes an undue
burden.
11)With respect to the content of electronic communications of
the user:
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a) Provide that, if a deceased user consented to or a court
directs disclosure of the content of electronic
communications of the user, the custodian must disclose to
the personal representative of the estate of the user the
content of an electronic communication sent or received by
the user if the personal representative gives to the
custodian specified forms of documentation, including,
among other things: i) a written request for disclosure;
ii) a certified copy of the user's death certificate; iii)
a certified copy of the letter of appointment of the
representative; and iv) a copy of the user's will, trust,
or other record evidencing the user's consent to
disclosure, unless the user provided direction using an
online tool.
b) Provide that, unless otherwise ordered by the court,
directed by the user, or provided in a trust, the custodian
must disclose to a trustee that is not an original user of
an account the content of an electronic communication sent
or received by an original or successor user and carried,
maintained, processed, received, or stored by the custodian
in the account of the trust if the trustee gives to the
custodian specified forms of documentation.
12)With respect to the catalogue of electronic communication
sent or received by the user, and digital assets, other than
the content of electronic communications, of the user:
a) Provide that, unless the user prohibited disclosure of
digital assets or the court directs otherwise, the
custodian must disclose to the personal representative of
the estate of a deceased user a catalogue of electronic
communications sent or received by the user and digital
assets, other than the content of electronic
communications, of the user, if the personal representative
gives to the custodian specified documentation, including,
among other things: i) a written request for disclosure;
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ii) a certified copy of the user's death certificate; and
iii) a certified copy of the letter of appointment of the
representative.
b) Provide that, unless otherwise ordered by the court,
directed by the user, or provided in a trust, a custodian
must disclose, to a trustee that is not an original user of
an account, the catalogue of electronic communications sent
or received by an original or successor user and stored,
carried, or maintained by the custodian in an account of
the trust and any digital assets, other than the content of
electronic communications, in which the trust has a right
or interest if the settlor of the trust is deceased and the
trustee gives to the custodian specified documentation.
13)Provide that the legal duties imposed on a fiduciary charged
with managing tangible property apply to the management of
digital assets, including all of the following: a) the duty
of care; b) the duty of loyalty; and c) the duty of
confidentiality.
14)Provide that a fiduciary with authority over the property of
a decedent or settlor has the right of access to any digital
asset in which the decedent or settlor had a right or
interest, as specified.
15)Require a custodian, not later than 60 days after receipt of
the information required, as specified, to comply with a
request from a fiduciary or designated recipient to disclose
digital assets or terminate an account. Further provides that
if the custodian fails to comply with a request, the fiduciary
or designated recipient may apply to the court for an order
directing compliance.
16)Make disclosure of the contents of the deceased user's or
settlor's account to a fiduciary of the deceased user or
settlor subject to the same license, restrictions, terms of
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service, and legal obligations, including copyright law, that
applied to the deceased user or settlor.
FISCAL EFFECT: None
COMMENTS: In July 2014, the National Conference of
Commissioners on Uniform State Laws (NCCUSL) approved the
Uniform Fiduciary Access to Digital Assets Act (UFADAA), which
was recommended for enactment in all states "to vest fiduciaries
with the authority to access, control, or copy digital assets
and accounts[,] ... remove barriers to a fiduciary's access to
electronic records[,] and to leave unaffected other law, such as
fiduciary, probate, trust, banking, investment, securities, and
agency law." UFADAA was recently revised to clarify the
application of federal privacy laws and give legal effect to an
account holder's instructions for the disposition of digital
assets. According to NCCUSL, the 2014 UFADAA provided
fiduciaries with default access to all digital information, but
the Revised UFADAA protects the contents of electronic
communications from disclosure without the user's consent, and
fiduciaries can still access other digital assets unless
prohibited by the user.
Prior versions of this bill would have enacted the Privacy
Expectation Afterlife and Choices Act, which is an alternative
approach to disclosure of a decedent's electronic information.
As amended in the Senate, this bill adopts a modified version of
the RUFADAA and attempts to provide a clear legal framework to
help probate courts resolve questions about how to balance
competing privacy and estate administration concerns when a
decedent's estate representative, for the purpose of settling
the estate, seeks information, records, digital assets, or
electronic communications, from, typically, the email or social
media account of the deceased user.
NCCUSL states that the RUFADAA was recently approved and
represents a consensus reached among stakeholders, including
technology firms, privacy advocates, bankers, and the trust and
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estate bar. NCCUSL asserts that the "consensus was the result
of a concerted effort by all parties over the last few months to
agree on a reasonable regulatory framework that will balance the
privacy interests of internet users with the need for
fiduciaries to perform their tasks and ensure the orderly
transfer of a decedent's assets to heirs. It gives legal effect
to an internet user's wishes when they are known, and provides
reasonable default rules that apply if the user has not
expressed a contrary intent. The act represents the best
opportunity to enact uniform legislation for an industry that
operates in every state." To date, 10 states (Colorado,
Florida, Idaho, Indiana, Michigan, Oregon, Tennessee,
Washington, Wisconsin, and Wyoming) have enacted RUFADAA, and at
least 18 other states have introduced RUFADAA legislation this
year.
Scope of the bill. Unlike the broader approach of the RUFADAA
model act adopted by the NCCUSL, the scope of this bill does not
include powers of attorney, trusts, and conservatorships where
the principal, trustor, and conservatee, respectively, are still
alive. Instead, this bill has a more limited scope that applies
only to situations where a person has died, and electronic
information is being requested from the custodian by a
decedent's personal representative, administrator, executor, or
trustee for the purpose of ascertaining the decedent's assets
and liabilities.
Disclosure of electronic communications. This bill provides
protections for a deceased user's private electronic
communications by establishing the circumstances under which the
custodian of the electronic communications could disclose those
communications. This bill establishes a three-tier priority
system for determining the user's intent for disclosure of his
or her electronic communications.
First in priority, this bill authorizes disclosure pursuant to
the user's designation through an online tool. This tool
provides the most current reflection of the user's intent for
disclosure to another person. Second, the user can provide
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directions in an estate plan for the disposition of the user's
digital assets. The custodian would then be able to rely on the
testamentary document containing these disclosure instructions,
which would then have legal effect pursuant to this bill.
Finally, if the user did not provide any direction regarding
disclosure of digital assets, the terms-of-service governing the
account would apply. If the terms-of-service do not address
fiduciary access to digital assets, the default rules provided
in this bill would apply. Opponents assert that, contrary to
what the bill provides, an online tool should take precedence
over a user's testamentary will only if the online tool is used
later in time after the will is executed.
Documentation needed for disclosure once authorization
established. Authorization of disclosure is not alone
sufficient to compel disclosure under this bill; additional
documentation must be provided to the custodian by the
representative of the decedent's estate. With respect to the
content of electronic communications sent or received by the
user, the bill provides that if a deceased user consented to or
a court directs disclosure of such content, the custodian make
such disclosure to the personal representative of the estate of
the user if the personal representative gives to the custodian
all of the following: 1) a written request for disclosure in
physical or electronic form; 2) a certified copy of the death
certificate of the user; 3) a certified copy of the letter of
appointment of the representative, a small-estate affidavit, or
court order; and 4) a copy of the user's will, trust, power of
attorney, or other record evidencing the user's consent to
disclosure of the content of electronic communications, unless
the user provided direction using an online tool (in which case
the online tool evidences the user's content, making this
documentation unnecessary).
With respect to the catalogue of electronic communications sent
or received by the user and digital assets other than the
content of electronic communications, the bill requires the
custodian to make such disclosure to the personal representative
unless the user prohibited disclosure of digital assets or the
court directs otherwise. More specifically, if the user did not
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prohibit such disclosure and there is no contrary direction from
the court, then under this bill the custodian shall make the
disclosure if the personal representative has given the
custodian all of the following: 1) a written request for
disclosure in physical or electronic form; 2) a certified copy
of the death certificate of the user; and 3) a certified copy of
the letter of appointment of the representative, a small-estate
affidavit, or court order. The bill specifies similar
documentation relevant to trusts to be provided to the custodian
by a trustee seeking disclosure of either the catalogue or
content of electronic communications.
For both the content and catalogue of electronic communications,
the bill also requires the personal representative to provide
any of the following additional documentation, if requested by
the custodian: 1) a number, user name, username, address, or
other unique subscriber or account identifier assigned by the
custodian to identify the user's account; 2) evidence linking
the account to the user; 3) an affidavit stating that disclosure
of the user's digital assets is reasonably necessary for estate
administration; and 4) an order of the court making certain
findings, as specified. Opponents of the bill assert that some
of these items of information - particularly the unique
subscriber information or other evidence linking the account to
the decedent for which records are being requested - should be
required to be provided in all cases rather than provided only
if requested by the custodian. They also recommend that the
bill should require the fiduciary to show that the information
contained in the account is necessary for the administration of
the estate, and not just in cases where the custodian has
requested production of a court order making such a finding.
Terms-of-service agreements. As discussed above, if the user
did not provide any direction regarding disclosure of digital
assets through an online tool or testamentary document (e.g. a
will), then under the third-tier of the rule, the
terms-of-service agreement governing the account would apply.
This bill does not change or impair a right of a custodian or a
user under a terms-of-service agreement to access and use
digital assets of a user, and does not give a fiduciary or
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designated recipient any new or expanded rights other than those
held by the user for whom, or for whose estate or trust, the
fiduciary or designated recipient acts or represents. This bill
provides that a fiduciary's or designated recipient's access to
digital assets may be modified or eliminated by a user, by
federal law, or by a terms-of-service agreement when the user
has not provided any direction, as specified. Opponents,
contend that the bill will ultimately allow custodians to freely
control the release and retention of digital assets under the
terms of service, because most users will not have a will or
make use of an online tool.
Author's intent to narrow grant of immunity from liability
provided to custodians for compliance with this bill. As
currently in print, this bill simply provides that "a custodian
and its officers, employees, and agents are immune from
liability for an act or omission done in good faith in
compliance with this part [i.e. the entirety of RUFADAA]."
Probate Code Section 881(f), as proposed by this bill, would
grant custodians broad immunity from liability as long as they
act in good faith in complying with the Act-with no exception
even for conduct amounting to gross negligence or willful or
wanton misconduct. Opponents of the bill contend that the broad
grant of immunity in this bill gives custodians no incentive to
act responsibly, and increases the probability that cases of
privacy invasion will occur since there will be little
consequence for careless behavior, or even gross negligence.
While the NCCUSL's intent may have been to protect the custodian
from liability for disclosure of a digital asset as long as the
custodian was acting in good-faith compliance, the Judiciary
Committee has a long history of ensuring that legislation it
approves does not provide blanket immunity from liability for
acts rising to the level of gross negligence or willful or
wanton misconduct, even when done "in good faith." (See, e.g.
AB 83 (Feuer), Chapter 77, Statutes of 2009, amending the
California "Good Samaritan" statute to grant qualified immunity
to any person who renders medical or non-medical aid in an
emergency, so long as that person acts in good faith and not for
compensation, but specifically exempting gross negligence and
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willful or wanton misconduct.)
In order to ensure that this Act, should it become law, does not
immunize disclosure of information that amounts to gross
negligence or willful or wanton misconduct, the author has
agreed to take steps to revise the immunity provisions proposed
by this bill in Probate Code Section 881(f). Because this bill
cannot be amended in this House to address this concern, the
author instead proposes that another bill, SB 873 (Beall) of the
current legislative session, be amended to accomplish this
purpose. Specifically, it is the author's intent that SB 873
(of which he is a principal co-author) shall be enacted
subsequent, and as a companion, to this bill so that if this
bill, is chaptered, then SB 873 shall also be chaptered to
replace the version of Section 881 of the Probate Code in this
bill. In other words, it is the author's intent that SB 873
enacts the ultimate language of Section 881, namely, to exempt
gross negligence and willful or wanton misconduct from any
immunity from liability for custodians provided by this Act.
Analysis Prepared by:
Anthony Lew / JUD. / (916) 319-2334 FN: 0004832