Berks County Bar Association The Berks Barrister Winter 2020-21 - 26

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Pennsylvania Standardizes Access to Digital Assets
Continued from page 25
Similar statutory authorizations apply under the Act for
trustees under a trust (each, a " Trustee) and guardians of estates
(each, a " Guardian " ). When the Trustee is the original user of
an account, the Custodian must disclose any digital asset of the
account held in trust. 20 Pa.C.S.A.§3911. When the Trustee is
not the original User of the account, the Custodian must disclose
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 when the Trustee presents
similar documents as an Agent under section 3909, except the
User Direction Document must be a certified copy of the trust
instrument or a certification of the trust and the certification must
be that the trust is presently in effect and the Trustee is presently
the trustee. 20 Pa.C.S.A.§3913.
A Guardian may compel a Custodian to disclose the catalogue
of electronic communications sent or received by the protected
person and any digital assets, other than the content of electronic
communications, of the protected person, if the Guardian provides
to the Custodian: (1) a written request for disclosure, (2) a
certified copy of the court order giving the Guardian authority
over such digital assets, and (3) if requested by the Custodian,
(a) the unique account identifier assigned by the Custodian or
(b) evidence linking the account to the protected person. 20
Pa.C.S.A.§3914. The Guardian may request a Custodian of digital
assets of the protected person to suspend or terminate an account
with a certified copy of the court order granting the Guardian
authority over the protected person's property.
The Act delineates a Fiduciary's duty and authority. The
fiduciary duties applicable to managing tangible personal property
apply to a Fiduciary of digital assets, including the duties of care,
loyalty and confidentiality. A Fiduciary's authority over a digital
asset: (1) is subject to (a) a Terms-of-Service Agreement (except
as provided in section 3904) and (b) applicable law including
copyright law; (2) is limited by the scope of the Fiduciary's duties;
and (3) may not be used to impersonate the User. A Fiduciary
with authority over the property of the decedent, protected
person, settlor or principal ( " Interested Person " ) has the right
to access any digital asset in which the Interested Person had a
right or interest and which is not subject to any Terms-of-Service
Agreement or held by a Custodian. A Fiduciary acting within
the scope of his or her fiduciary duties is an authorized user
property of the Interested Person for purposes of computer fraud
and unauthorized computer access laws ( " Authorized User " ).
20 Pa.C.S.A.§3915(d). Similarly, a Fiduciary with authority
over the tangible personal property of an Interested Person,
has the right to access the property and digital assets stored in
that tangible personal property and is an Authorized User. 20
Pa.C.S.A.§3915(e). A Custodian may disclose information in an
account to a Fiduciary when the information is used to terminate

26 | Berks Barrister

an account which is used to access digital assets licensed to the
related User. The Act also provides procedures for terminating an
account.
The Act specifically addresses Custodians. They must respond
within 60 days of receipt of a written request for production of
a List, electronic communications or other digital assets by a
Fiduciary, failing which the Fiduciary may apply for a court order.
The court order must contain a finding that the disclosure does
not violate 18 U.S.C. §2702, regarding voluntary disclosures of
electronic communications and other records, part of the ECPA.
The Custodian may notify a User that it received a request for
disclosure or termination of an account under the Act. The
Custodian may request or require a Fiduciary to obtain a court
order which: (1) specifies that an account belongs to a protected
person or principal, (2) specifies there is sufficient consent from
the protected person or principal, and (3) contains a finding
required by law other than the Act. Finally, a Custodian, its
officers, employees and agents " are immune from liability for an
act or omission done in good faith in compliance with [the Act]. "
20 Pa.C.S.A.§3916(f ).
Sen. Thomas H. Killion (R-9) sponsored SB 320, which
was co-sponsored by, among others, Sen. Judith L. Schwank
(D- 11), both of whom co-sponsored a prior Senate bill covering
the same subject matter in the 2017-2018 session. SB320 was
signed in the Senate on July 13, 2020, and in the House on July
8, 2020. Governor Tom Wolf approved SB 320 on July 23, 2020
as Act 72 and it will become effective 180 days thereafter. The
Act is important because it " will extend a fiduciary's existing
authority over a person's tangible assets to include the person's
digital assets, with the same fiduciaries to act for the benefit of
the represented person or estate, " according to Sen. Killion's CoSponsorship Memo ( " Memo " ). Further, the Act was supported
by many stakeholders, including the NCC, the Pennsylvania Bar
Association, the Pennsylvania Bankers Association, the Joint
State Government Commission and the Administrative Office of
Pennsylvania Courts. In the Memo, Sen. Killion cited a statement
of the National Conference of State Legislatures that 46 states
had already passed digital asset legislation. The Act will provide a
standardized set of rules for Fiduciaries to have access to digital
assets, thereby improving the administration of digital assets in
Pennsylvania.
Mr. Hobaugh is a solo practitioner
in Kutztown and focuses on finance,
entity formation and governance,
land use and estate planning.


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Berks County Bar Association The Berks Barrister Winter 2020-21

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