Saturday, May 13, 2017

Florida Wills go Electronic

A bill has cleared both Houses of the Florida legislature authorizing electronic wills and electronic will execution in Florida. Absent an unexpected veto by Gov. Scott, the last wills of testators may now precede them into the cloud(s).

The new statute has endeavored to reduce avenues for fraud and misdeeds. Only time will tell whether electronic wills will be more or less subject to fraud and improper usage than paper wills. Paper wills are not affected by the new legislation, except as they may be revoked and replaced by electronic wills.

Here are some key provisions and observations regarding the new statutes, based on my initial review:

     1. If the testator signed electronically, so must the witnesses. The two witness requirement remains in effect.

     2. Electronic signatures are similar to what you may be familiar with in regard to opening bank and brokerage accounts online, where the signing person types his or her name or otherwise marks the document electronically. It does not require the signatory to affix a digital signature - that is, the signatory need not establish a digital online identity with a third-party provider that is then affixed to an electronic document.

     3. The testator and the two attesting witnesses must still be in the presence of each other. However, commencing in 2018, such presence requirement may be met by a live video conference arrangement between the signatories. Such videoconferences must meet numerous statutory requirements, including the participation of and attestations by either an attorney or a notary public, a timestamp recording of the conference, and the verbal answering of six questions by the testator. Such videoconference witness presence requirements will also extend to living wills.

     4. If the will contains a self-proving affidavit, the will and affidavit must be electronically stored with an authorized custodian. The custodian must be a Florida resident or entity, must obtain a surety bond and required liability insurance, and must meet numerous requirements as to maintaining its electronic database, limiting access to the electronic records, and otherwise dealing with and releasing the electronic records. Thus, absent the involvement of such a third-party custodian, electronic wills will not be self proved, and will be admitted to probate only upon the testimony of the two witnesses or if they are not available, of two disinterested persons. Custodians will be responsible for the negligent loss of their electronic records.

     5. Persons drafting electronic wills should include in the wills the designation of the custodian, and also designate who has access to the electronic will if such access is intended to be granted to persons otherwise than those authorized in statute.

     6. These electronic rules extend to the execution of revocable trusts that have testamentary provisions.

These new rules should facilitate the business of Internet-based will preparation companies. They may also facilitate the signing of wills prepared by attorneys when it is not practical for the testator to come to the attorney's office or otherwise sign with proper formalities. Perhaps larger law firms may establish in-house qualified custodian capacities for the benefit of their clients, but given the obligations imposed on qualified custodians and liability exposures I would think we will soon see third-party companies doing business in Florida that offer such qualified custodian capacities along with online video-conferencing facilities and procedures to assist in the signing process. I also wonder whether once electronic signing becomes more routine whether most attorneys will adopt electronic signing in their offices (through the use of third-party software and custodians) in lieu of traditional paper wills and pen on paper signing.

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