In a prior blog, And When I Die…. What Happens to My Social Media?, I discussed Maryland’s “Fiduciary Access to Digital Assets Act” (“MFADAA”). The statute permits the “user” of “digital assets” to authorize a designee to access specified digital assets after the user’s death or disability. It is codified in Md. Code Ann., Est. & Trusts Art., Title 15, Subtitle 6.

A recent decision of the Maryland federal court demonstrates that a grantor wishing to give another person access to digital assets after the grantor’s death needs to strictly comply with MFADAA. Grants that provide only constructive notice fail.

In Holland v. Signal Financial Credit Union, 2024 WL 167465 (D. Md. Jan. 16, 2024), the Hon. Timothy J. Sullivan applied MFADAA. Because plaintiff did not meet the statutory requirements, plaintiff’s MFADAA claim to access of digital assets failed.

It is black letter law that the Maryland “General Assembly is presumed to have meant what it said and said what it meant. When the statutory language is clear, we need not look beyond the statutory language to determine the General Assembly’s intent. If the words of the statute, construed according to their common and everyday meaning, are clear and unambiguous and express a plain meaning, we will give effect to the statute as it is written. In addition, we neither add nor delete words to a clear and unambiguous statute to give it a meaning not reflected by the words that the General Assembly used or engage in forced or subtle interpretation in an attempt to extend or limit the statute’s meaning. If there is no ambiguity in the language, either inherently or by reference to other relevant laws or circumstances, the inquiry as to legislative intent ends.” Peterson v. State, 467 Md. 713, 727 (2020). In other words, absent ambiguity, courts apply statutes as written.

The Holland Court did just that.

Plaintiff Holland was the sole heir and executor of his cousin’s estate. The decedent maintained two accounts at Signal credit union, a home improvement loan, and an overdraft account. Holland sought access. Signal refused and demanded Letters of Administration for access to the accounts. Mr. Holland “was informed that Signal’s policy was to deny digital access to a decedent’s accounts.” However, Signal sent monthly account statements to Mr. Holland.

Mr. Holland sued under, inter alia, the MFADAA. The Court granted summary judgment for defendant Signal.¹

The Holland Court wrote that: “Evelyn Holland asked her first cousin, Mr. Holland, ‘to accept her power of attorney to manage her financial affairs, and to act as eventual estate Executor.’ Mr. Holland agreed to Evelyn Holland’s request. Evelyn Holland died on July 12, 2022. Mr. Holland was the sole heir of the decedent’s estate.” [cleaned up].

Mr. Holland presented two issues under MFADAA.

THE WILL DID NOT MEET THE REQUIREMENTS OF MFADAA

Mr. Holland relied on a will to grant MFADAA access. The Court wrote that the MFADAA §15-106 “provides that a fiduciary is only required to be granted digital access to a decedent’s financial records if the decedent had previously indicated that such digital access should be granted.”

The Court wrote: “There is no dispute that Mr. Holland never produced to Signal evidence that Evelyn Holland authorized him to have digital access to her accounts. In fact, Mr. Holland testified that he was not granted such digital access to Evelyn Holland’s accounts in the power of attorney or will of the decedent.”

Holland argued that “the Decedent’s Last Will and Testament authorizes Executor’s digital access to banking records.” The Court disagreed.

Maryland’s law governing access to digital assets is a statutory framework for determining when a person is entitled to certain digital access rights. As explained above, a fiduciary is only entitled to digital access of a decedent’s bank accounts if they present certain evidence that the decedent wished for them to have such access. Mr. Holland has failed to present such evidence here.

Hon. Timothy J. Sullivan in Holland v. Signal Financial Credit Union, 2024 WL 167465 (D. Md. Jan. 16, 2024).

The Court noted that Mr. Holland’s allegation about the will was contradicted by his sworn testimony; however, even if the will did grant access, Holland failed to submit the document to the Court.

WRITTEN NOTICE IS REQUIRED BY MFADAA –
CONSTRUCTIVE NOTICE IS NOT ENOUGH

The Court wrote: “Signal … notes that Mr. Holland never made a written request for digital access to the decedent’s accounts, which is required by Maryland’s Fiduciary Access to Digital Assets Act.”

Mr. Holland admitted that he never made a written request; however, he stated that he made oral requests. However, Mr. Holland argued that Signal “received a constructive written notice when Mr. Holland complained to the authorities.” Id. at *3. The nature of those complaints was not described in the Court’s opinion.

The Court firmly rejected the “constructive notice” argument:

And as for Mr. Holland’s arguments that Signal had “constructive notice” of his request for digital access, the Court notes that Maryland’s law does not require a custodian to provide digital access under such circumstances. Instead, what is required is that a person wishing to obtain digital access make a written request to the custodian for such access, along with proof that the decedent had authorized them to have such access.

Hon. Timothy J. Sullivan in Holland v. Signal Financial Credit Union, 2024 WL 167465 (D. Md. Jan. 16, 2024).

CONCLUSION

The Holland Court concluded:

Since both a written request and proof that a decedent has authorized digital access are required under Maryland’s law, Signal rightly denied Mr. Holland’s oral requests for digital access.

Hon. Timothy J. Sullivan in Holland v. Signal Financial Credit Union, 2024 WL 167465 (D. Md. Jan. 16, 2024).

The Court denied Truth in Lending Act claims and entered summary judgment for the defendant.

Maryland’s “Fiduciary Access to Digital Assets Act” can provide significant benefits; however, a user must follow its specific terms in order to convey those benefits.

NOTES

¹ Mr. Holland did not timely pursue discovery to oppose the summary judgment motion. The Court held that Mr. Holland “waited too long to propound discovery requests and that he had not shown good cause to extend the discovery deadline.” For a recent Fourth Circuit decision demonstrating the importance of milestone dates, see Failure to Object to Untimely Interrogatories Coupled With a Discovery Violation Leads to Reversal; accord Better Late Than Never? Case Dismissed for Filing 16 Minutes After Midnight.