Computer-with-Testament-Key

Wills and trusts has traditionally been an arcane practice area, known for things like attorneys using legal-size paper and terms like bequest, devise, and residue. But no more – the age of the E-Will is fast approaching. The state of Florida is taking the lead in considering changing the storied laws of probate to include electronic wills. 

Surveys in the U.S. show that somewhere between 42% and 64% of people do not have any type of will or estate plan. An overwhelming percentage of people in the court system do not hire a lawyer. Considering that there are approximately 320 million people in the United States, there is a large need for advancements that make estate planning easier and more convenient.

Other countries have forged ahead in adapting wills to currently technology. Legal Zoom currently has a product in the U.K. called “Legacy that lets people create and even update a digital will with their smartphone. The app lets people pass on their social accounts and passwords, and will even self-update when a beneficiary turns 18.  It should also be noted that Nevada has had an electronic wills law on the books since 2001, however that law simply allows for electronic signing and storage of a will. 

The Florida Electronic Will Legislation

There are currently two versions of the proposed legislation: the House Bill (pdf) and the Senate BillEssentially, the proposed legislation in these two bills sets the standards for creating and probating an electronic will  by changing the law to specifically allow them. Besides that, the legislation does not create any ground-breaking probate laws. Before this legislation there was not any specific prohibition against electronic wills, but this legislation creates new laws specifically recognizing them as valid. 

The proposed legislation allows people to have their signature witnessed by two people over a video conference, as long as a copy of that video conference is kept and stored. The bill also defines who or what can serve as a custodian for an electronic will for purposes of probating it in Florida:

The bill defines a qualified custodian of an electronic will as a person who meets all of the following requirements:  

  • Is not an heir or devisee of the testator.  Is domiciled in and a resident of Florida or is incorporated or organized in Florida.  
  • Consistently employs a system for ensuring the safekeeping of electronic records and stores electronic records containing electronic wills under the system.  
  • Furnishes for any court hearing involving an electronic will that is currently or was previously stored by the qualified custodian any information requested by the court pertaining to the qualified custodian’s policies and procedures

Senate Judiciary Committee Staff Analysis (pdf).

Absent from the bill are any mentions of electronic authentication (i.e. blockchain) or of making wills into smart contracts for estates under a certain amount with no challenges. Perhaps these changes will come in later legislation, or a court will evaluate them against the current law at some point.

The Company Behind the Legislation

While the idea of giving probate law a face-lift for the 20th century is an admirable goal, this bill is apparently being pushed by a private company and not by the state bar association. Bequest, Inc., is a Miami-based corporation that runs the website Willing.com. Bequest hired the national lobbying firm of Ballard Partners in 2016, and the electronic wills legislation was filed early in 2017. Matt Forrest, a lobbyist at Ballard Partners and registered lobbyist for Bequest, gave testimony (pdf, page 149) in favor of the bill in its first Florida Senate committee stop this year. It is likely that Bequest plans to launch a product enabled by this legislation in the near future. 

Mr. Forrest, Representative James Grant (the sponsor of the House version of the bill), and Peter Dunbar (the lobbyist for the Florida Bar’s Real Property, Probate, and Trust section) were all asked for comment but did not respond.

Where Do We Go From Here?

Many people use the internet and their smartphones for their jobs and for most everything else. The legal industry has lagged far behind in offering people technology-based solutions for their legal needs, and areas like estate planning seem farther behind the curve than others.

Although the bills are being pushed by Bequest it is likely that other companies like legal services giant Legal Zoom as well as several smaller companies create products to offer electronic wills. Going forward we will likely see more states adopt legislation expressly permitting electronic wills. The true tests will be whether products pushing electronic wills are usable, and whether people actually begin to use them for estate planning.

8 Comments

  1. April King says:

    I don’t have an objection to electronic Wills, per se, in the sense that if people want to hire a corporation using standard templates to let them people fill them in and store them electronically doesn’t make me feel threatened. I expect to see probate disputes rise, and as an estate planning and administration lawyer, that’s fine by me, because that’s where the money is. But what does really bother me in all this is the failure to address the bedeviling issues of undue influence and lack of capacity. How will these Will services guard against misuse? And when those who lose by their misuse challenge those documents, what proof will they rely on? I’m involved (as a witness, because I drafted the docs) in an estate plan challenge right now. My testimony and my file will be key in trying to make sure justice is done for my client, who has now died, and those she wanted to benefit. I don’t see anyone addressing the way that electronic documents lend themselves to even higher rates of abuse of the elderly and vulnerable.

  2. Sam Harden says:

    The electronic wills statute doesn’t really add any protections for undue influence or lack of capacity, but it does have the provision that allows witnesses to be present through a video-conference. It will be interesting to see how it plays out if enacted.

  3. Carolyn Elefant says:

    What percentage of wills and trusts wind up in dispute? Why are those the ones that we plan for? When my husband died, he left everything to me for the benefit of our daughters. No one in the family disputed that. Yet I paid $5000 for a trust, another $5000 to hire an accountant to prepare an estate tax form that I had to do all the work for in gathering DOD valuations – even though as a spouse I am exempt from any taxes, and nearly 2 years getting IRAs, stock, car title and other accounts transferred. Why not make the probate system easier for the majority of cases instead of planning for disasters that are always going to happen and that can’t be controlled irrespective of the amount of protections that are put in place. Block chain technology can’t arrive soon enough.

    • Sam Harden says:

      Carolyn I completely agree with this. Prohibitive pricing, not to mention the hassle of finding an attorney and working with them, for something that should be near-automatic is what keeps so many people from developing an estate plan.

  4. Jay says:

    Carolyn, I would not consider the $5,000 for the trust as a probate cost. I suspect your attorney advised you to have a trust to protect your daughters in the event you die. That is solid advice and what I recommend to all of my clients with children under 22 or so.

    The $5K for the accountant is likely to file both federal and state estate tax returns. Once again, that is not technically probate because it applies whether an estate is in probate court or not. The solution would be get rid of the estate tax at all levels.

    In Ohio we did repeal the state estate tax in 2013. The repeal has affected by revenues because I do not have to do as much work for clients after death. However, it is good for the clients because they save $50K on a million dollar estate while also not paying a larger bill of mine.

  5. April King says:

    To Ms. Elefant’s questions–the problem is that it’s about impossible for the planner to predict ahead of time which cases will someday be challenged (some are obvious, yes, but in some cases people who do not receive under a plan, inexplicably and unreasonably file a challenge). In addition, if a trust document does not adequately direct the trustee, the trustee is faced with getting a court’s blessing on a proposed course of action, or accepting some level of liability, possibly unknown.
    The law is always built to deal with “what happens when people disagree.” Folks are free to avoid the costs of lawyers and accountants and base their affairs on trust that all reasonable people will get along. I’d prefer to do things that way myself. Ms. Elefant’s frustration is understandable, but I do not see how lawyers and accountants, faced with liability for failing to cover all bases, can do otherwise than draft extensive trusts, file extensive returns (I wonder if your advisor thought you should file one just to elect portability–there are reasons that may justify filing a return even when the marital deduction applies to the whole estate), etc.
    The current brouhaha among Bitcoin miners regarding how to handle the growing problem of the size of the calculations in its “block chain” platform, and the limited availability of terms for which block chain applications can work in contracts, and the failures of the claims of greater security for electronic block chain-based currencies, all tell me we are a long, long way from being able to auto-electronically handle the transactions of life on the block chain.

  6. Richard M Morgan says:

    To Ms. Elefant, while other very good comments already cover your questions, I thought this might help as well. You are free to do as you please. The law sets out certain probate and estate and trust administration requirements, in some states very few can not be waived like in my state of GA but other states have much more onerous rules such as in FL, NY and CA, especially as to fees, and it also provides a gov process to notify and pay your creditors and distribute any remaining assets for those who do not plan otherwise themselves. Estate planning on the other hand enables you to essentially make private documents to cover your affairs if you need assistance during your life and eventually upon your death. You get to decide what happens, what costs and hassles are avoided to extent legally possible and who will be in charge to carry out your wishes. You also decide how your assets are owned and how beneficiaries are designated to pass assets at your death, either through or outside the probate process. Now, you can say it is simple and do it yourself or get some simple form help with the likes of the Legal Zooms of the world, you can go with an unsophisticated attorney to assist and use their normally better form help, or you can take the position that your really, truly do care what happens to you and your family upon incapacity or death and you seek out the services of a sophisticated estate planning attorney. Your choice, no gun to your head. We all have limited resources and have to choose how to spend them. You get to decide how you spend yours.

  7. Suzan Herskowitz says:

    I am honestly glad I’m in the last 15 years of practice and not just beginning. In this day of cheap and quick for everything, it is more and more difficult for a small town lawyer to make money on estate planning. That said, through hard work, I earn a living. While my fees are very reasonable for the region, there are those that will not pay for the services of an estate planning attorney. They do not believe that the TIME we spend discussing their estates, including non-probate assets, is valuable. They are going to love electronic wills and electronic signing, as they love online documents and forms. We all know that for every few DIY wills or powers of attorney, there will be one that may have issues. I had a client who paid me $10k to probate a will that was considered not properly executed and was therefore contested by the testator’s family. If it had been properly executed, barring a will contest (and in this case, there may have been one anyhow), Virginia doesn’t require a lawyer to probate a will. But the testator improperly executed the will and in doing so cost his beneficiary $10k (and who knows what the other attorney charged the remaining family). In my view, penny wise and pound foolish but you cannot tell a client that is used to quick and cheap and price shopping otherwise. I’ve seen powers of attorneys that were poorly self-drafted and didn’t do what the clients wanted. I’ve had clients have me draft a will and do their own powers of attorney and then ask me to provide the witnesses and notary to execute the documents!

    We know that a poor heir at law will fight want to fight tooth and nail over every dollar even after you explain that they will spend more in attorney’s fees than they will ever receive. They will fight over $20k estates as easily as $200k estates.

    There is little perceived value in our experience (30+ years) or knowledge. They just want a product. We are not going to change it. The question becomes how do we earn a living in this changing atmosphere.

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