West Virginia and Wisconsin Legislative Update

West Virginia and Wisconsin Legislative Update

West Virginia has now enacted the Revised Uniform Fiduciary Access to Digital Assets Act, effective June 5, 2018 (the “West Virginia Act”).  The Wisconsin legislature recently amended its laws governing payoff statements and transfers by affidavit, effective April 18, 2018.

 

WEST VIRGINIA SENATE BILL 102

 

The Uniform Fiduciary Access to Digital Assets Act (the “Act”) has been enacted in various states on which we have previously reported.  (see our Distribution Memoranda dated September 1, 2016 with updates dated February 17, March 30, June 1, July 13, August 9, September 7, November 21, December 6, 2017 and April 12, 2018).

 

The acts in each state have minor differences, but the primary focus of the Act is to define digital assets and the parties involved, which generally includes the following:

 

  • Custodian (person or entity that carries, maintains, processes, receives or stores a digital asset of a user)
  • Digital Asset (electronic record in which an individual has a right or interest, but does not include an underlying asset or liability unless the asset or liability is itself an electronic record)
  • User (person who has an account with a custodian)
  • Designated recipient (person chosen by a user using an online tool to administer digital assets of the user)
  • Fiduciary (an original, additional or successor personal representative, conservator, agent or trustee).

 

The state enactments set forth the requirements and obligations for a custodian to provide a designated recipient or fiduciary with access to the digital assets of a user, with slight variations from state to state.  In some states, the act also amends the statutory power of attorney, if any, to include a power related to digital assets.   The West Virginia Act includes an amendment to the West Virginia statutory power of attorney form to include the exercise of authority over the content of an electronic communication of the principal in the grant of agent’s general authority.

 

Wisconsin Assembly Bill 607

 

A secured creditor may qualify a payoff amount or state that the payoff amount is not practicably determinable or is subject to change before the payoff date if all of the following apply:

  • The security instrument secures an interest in real property that is not residential real property; and
  • The payoff statement provides instructions for how the entitled person or an authorized agent of the entitled person may obtain an updated payoff amount at no charge during the secured creditor’s normal business hours on the payoff date or the immediately preceding business day.

 

If an interest in real property is transferred by affidavit and is acquired by a purchaser or lender in good faith, for value and without actual notice that the transfer was improper, the purchaser or lender takes title free of any claims of the decedent’s estate and incurs no personal liability to the estate, whether or not the transfer was proper.  Purchasers and lenders have no duty to inquire whether a transfer was proper.