Digital assets in French successions

Wed 26 February 2020, Philippe Ropenga Digital assets estate planning

It may seem strange to introduce the notion of digital estate in French law by remembering that one's estate remains after one has passed away. Estate planning however is also designed to transfer a tidy estate to heirs and legatees. A testator may thus remove things that he does not want to leave after himself and give his assets with an intention that carries his spirit after his death. Digital things are digital because they can be reduced to a succession of digits. One should one care about digits? Probably because they affect the non-digital world that one leaves behind oneself. Digits carry data. Legal questions arise when data are related to a person (1). Data are part of the link that link a person to another one (2).

1 From data to person

Accessing and controlling data (1.1) is important since they describe a person (1.2).

1.1 Accessing and controlling data

Digital assets are made of data. When data contain personal information, people have the right to access, modify, delete, or transfer them. General provisions regarding these rights have been harmonised in the EU by the EU General Data Protection Regulation (GDPR)¹. I have no intention to analyse the GDPR that you already know but will focus on French law. One has the right to access to his data but does one have the right to access to the data of a deceased person by claiming that one holds rights from that person? The French Conseil d'État, i.e. the administrative supreme court approved the French administrative body in charge personal data regulation for having declined access to data of a deceased personal on the ground that a person could only access to his personal data.² The Internet and especially social networks have created a situation in which people may seem to be living since their profiles can still be seen after their death. French law has been amended to take this situation into account.³ One can appoint a person to take care of his data after his death. The appointment is registered by a trusted third party. The appointed person has to follow the terms of use of a given service to exercise his rights. The terms of use cannot limit the rights of the appointed person.⁴ It means that one should read terms of use very carefully before making a claim related to personal data. When the deceased has not left any instructions, heirs can make a claim regarding his data to liquidate the estate or to take the death into account, for instance by updating a profile or closing an account.⁵ Heirs do not make a claim because they wish to mine data but because the information available on the Internet reveals something about the deceased.

It thus is interesting to switch the focus from data to person.

1.2 Describing a person

If one focuses only on data, the previous subparagraph is sufficient. It seems to me that digital assets are as personal as non-digital assets. It is very difficult to determine what piece of information matters. Furthermore, artificial intelligence is a game changer that may well mitigate the importance of personal data. Personal data are useful since they allow a person to contact another one. They are also necessary to understand the situation of a given person in a given matter. Artificial intelligence needs data to learn, but relevant data are not necessarily personal. When one runs an online shop and wishes to use pricing bots to adjust prices, data related to sales are relevant and are not necessarily personal. Once bots have learned from personal data and have produced a canvas that they will follow to adjust prices, they are less dependent on personal data. It may be objected that learning is a continuing process and that data are needed to learn about new customer behaviour. Relevant data are however not necessarily personal data. The subject of personal data processed by artificial intelligence tends to omit the person behind the data because one may fear the use of data mining by large corporations. The International Conference on Law and Economics considers that the negative effect of the use of algorithms for instance by a cartel of online sellers to instantly put competitors at a disadvantage on a marketplace is overestimated.⁶ Hence, data mainly matter not because they are personal but because they describe a person and because that this description may not disappear with the death of that person.

It has been seen that French law paid a great attention to personal data while the person mattered most in a succession context. Let us now see that for the notion of digital asset to be useful in a trust and estate context, one has to pay a great attention to the relationship that has existed between the deceased and an heir.

2 From person to person

The practitioner helps to recreate a situation (2.1) that enables heirs to confer value to assets (2.2).

2.1 Recreating a situation

It has been seen in part 1 that data regulation focused on who accessed, controlled, or processed them. This is quite similar to what happens in the tangible world where one can hold the legal title while another one enjoys the thing or holds it on trust for the benefit of someone else. It would however be strange to describe an estate as a bundle of property rights. When someone plans his succession, he does not only care about his estate but also about his heirs. He wants to create a situation that will probably benefit his heirs. Solving a succession dispute also requires to create a legal and factual situation that does not seem to neglect anyone. This is different from liquidating property rights. It requires to take the emotions of each stakeholder into account. Artificial intelligence already helps the practitioner to find cases that are similar to the one that he is reading in a database. It can assist in writing standardised documents.⁷ Hence, it already helps the lawyer to find solutions faster without relying entirely on personal data. He thus can focus on negotiating to create a new legal situation that is accepted by all stakeholders. When it comes to data in a succession context, the deceased is not embarrassed by his accounts on social networks, but his heirs may wish to leave a tidy picture of him. This digital cleaning requires not only to access the accounts but also to decide what matters. A thing matters only when it has a value. This may seem obvious, but it is not. A thing does not have any value by itself. Heirs confer value to assets in a succession context.

Let us now see that digital assets are not different from tangible ones as far as value is concerned.

2.2 Conferring value to assets

Digital assets are often seen from the perspective of personal data or intellectual property for two good reasons: they are not tangible and their ownership seems more complex than that of tangible things. Since you are familiar with this blog, you may also have good reasons to think that digital assets are part of an estate and thus could be treated as any other piece of property. Intellectual property law is seen as necessary because it helps to acknowledge and protect a creation or an invention that has been influenced by the spirit of his creator. The spirit of an artist may sometimes be preserved by property law when intellectual property would not allow to achieve a satisfactory result.⁸ Hence, focusing on intellectual property law just because a thing is digital narrows legal analysis inappropriately down. It is true that the ownership of a digital item may seem less obvious than that of a physical one. One may for example ask oneself what ownership of a digital thing means. Does it mean that one has the right to access, modify, control or process the thing? Ownership is related to legal title. Similar questions can be raised about tangible goods in estate-managing issues. It has been seen that answers to these questions largely depended on practice and habits.⁹ Rights to data or intellectual property establishes who can do what with a thing. They however do not help to determine the value of a thing since a thing has no value by itself.¹⁰ When dealing with digital assets, the practitioner has to make sure that heirs agree on their value. He will otherwise not be able to solve disputes about the estate. It thus appears that digital assets are not completely different from tangible assets.

It has been seen that digital assets required the heirs and the practitioner to use property rights to create a situation that enhances the development of value.

In brief, artificial intelligence and intellectual property law are interesting in a succession context provided that the trust and estate practitioner does not set his skills aside.

Go Top