The increasing pace of technological change is our reality, and when it comes to estate planning, there is no exception.
The traditional formalities for wills and powers of attorney are stricter than for most legal documents: for example in Ontario a will has to be in writing and signed at the end by the will maker in the presence of two witnesses, who each in turn sign the will in the presence of the will maker and each other. The same process must be followed for an Ontario power of attorney for property and for personal care. The objective is to prevent fraud and help ensure the document reflects the testator’s free will – after all he or she will not be around if an issue later arises with regard to the validity of the document. Holograph wills – those which are all in the will maker’s handwriting and signed by the will maker at the end are also permitted in Ontario, as well as in many other jurisdictions.
But how do these legal requirements for estate planning documents meet the challenges of a digital age? Law commissions and legislative bodies are actively considering this issue in a number of jurisdictions as a major area of law reform.
Nevada introduced electronic wills in 2001, but because the requirements to authenticate a will are so difficult, they are not being used in practice and new legislation is now being proposed. Most recently in 2017, the Florida state legislature passed an act to allow electronic wills and the requirements for them which allowed for digital signatures, electronic form and no paper form, and witnessing by a recorded video conference. But Governor Rick Scott ultimately vetoed the law on the basis it did not have sufficient safeguards to protect against fraud and vulnerable persons being subject to undue influence. The law commissions in England and Wales and the U.S. are making progress in considering how the law of wills can be brought into a digital age, allowing for documents to be signed digitally, and also for documents only in electronic form which are not reduced to paper form. The general tenor of the work to date is not whether to have electronic wills, but to recognize that given modern technological change, the law must be reformed to keep up and the bigger issue is how.
There are a number of policy reasons why electronic wills make sense. The Law Commission (England and Wales) sets forth in its recent 2017 report on reform of the law of wills the public expectation to manage what we do digitally, convenience, efficiency, accessibility, safekeeping and security. It also recognizes that the key challenge is ensuring authenticity of a will maker’s digital signature, that the legal infrastructure adopted must be viable, both technologically and commercially, and that there be consistency in the platform used in executing and storing electronic wills and witnessing requirements to protect the will maker from fraud and undue influence.
Today, legal documents for major mergers and acquisitions and the movement of billions through the financial system are accomplished with a keystroke with no physical interface. The time has come to meet the digital challenge for estate planning documents, and at the same time actually improve existing practices.
Current processes have a number of drawbacks, and reflect life in an earlier time, in particular with regard to the security and safekeeping of original paper documents and ensuring a document is in fact a deceased person’s last will and not an earlier version. In most common law jurisdictions, including most Canadian jurisdictions, there is no formal process to register and keep a will in safekeeping, unlike in civil law jurisdictions where a will is registered with a notary under the applicable law. Many lawyers do not hold client’s original documents and many who used to no longer do because of the cost and liability issues, increasing the risk of original documents being misplaced or destroyed. The present system is increasingly less reliable as people become more peripatetic, change lawyers, hold their own original documents, and do not have close family aware of their affairs. Identifying if a person has a will, locating the original, and making sure it is in fact the last will is become more challenging and riskier because in many cases there is no organized process.
In the face of these demographic developments, technology may offer solutions for security, safekeeping and registration to meet our modern needs. It is not a situation of “if it ain’t broke why fix it”- the system is becoming more broken. It will be interesting to see how these legal developments play out in the next decade and how Canadian jurisdictions respond to the challenge.
The comments offered in this article are meant to be general in nature, are limited to the law of Ontario, Canada, and are not intended to provide legal or tax advice on any individual situation. In particular, they are not intended to provide U.S. legal or tax advice. Before taking any action involving your individual situation, you should seek legal advice to ensure it is appropriate to your personal circumstances.