Now an essential part of most Canadians’ holdings, digital assets can hold significant monetary and/or sentimental value. If a person dies or loses mental capacity, their estate trustee, executor, administrator, attorney under power of attorney, trustee under a trust, committee or guardian of property (your “Fiduciary”) may have difficulty accessing those assets.
Digital assets have been defined as a “record that is created, recorded, transmitted or stored in digital or other intangible form by electronic, magnetic or optical means or by any other similar means.” Cryptocurrencies are a primary example, but digital assets also include email accounts, online banking accounts, loyalty points, social media accounts, NFTs, digital photos, videos, music, domain names and intellectual property.
How does my Fiduciary access these assets once I cannot?
Current Canadian legal landscape
There is an overwhelming gap in the law, which has not kept up with technology, regarding one’s ability to access information about another person’s digital assets. There is no federal legislation in Canada dealing with it and, of the provinces and territories, only Saskatchewan and Prince Edward Island have enacted applicable legislation: Saskatchewan’s The Fiduciaries Access to Digital Information Act, which came info effect June 29, 2020, and PEI’s Access to Digital Assets, which came into force January 1, 2022.
Both Acts grant a Fiduciary the right to access digital assets of an “account holder” (you) who has a service agreement with the “custodian” of the digital assets (ex. bank, rewards program, digital wallet provider, or social media provider). Both statutes contain an exception for an employer’s digital assets used by an employee in the ordinary course of the employer’s business, such that a Fiduciary cannot demand access to the employer’s digital assets.
In those jurisdictions such as Ontario where there is no legislation yet in force giving the legal right to access such information, it is imperative that you include powers in your will and POA granting authority to access those assets. While they will still face the “hoops” through which each provider will require them to jump, at least your Fiduciary will have some ability to proceed if they are given authority to do so. If there are assets you do not want your Fiduciary (and your family) to access, your will and POA should reflect those intentions.
You need a digital estate plan to pass on your digital inheritance. A properly drafted will and power of attorney are essential. Planning is needed to ensure your Fiduciary will have the passwords and private/public keys required to access both the physical devices storing the information and the online accounts, platforms and digital wallets where the assets are held. Your plan should include using password management software and digital asset succession management software. A lawyer familiar with these issues can guide you through the development of your digital estate plan.
Why is all this important? These assets are worth something! Inability to access rewards points, PayPal account balances, cryptocurrency, intellectual property rights, business or personal branding and social media followers means lost assets.
And what about lost photos, videos, posts, and other personal data – priceless?
