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F387D41090531BA187258936006E5B56 Hearing Summary


Date Jan 13, 2023      
Location HCR 0112

Uniform Electronic Estate Planning Documents Act - Removed from this year's Legislative Agenda

01:06:02 PM  
Steve Brainerd
with the Trusts & Estates Section of the Colorado Bar Association (CBA),

stated that a subcommittee was formed after December's meeting to review
the act. He reaffirmed that the section favors the concept of the act and
would like to see something like it enacted, however, the section continues
to strongly believe that the act needs to be studied more in regards to
Colorado law. In the subcommittee's initial review of the act it has found
several potential issues that may need to be addressed. There are a number
of definitions that are at odds with other provisions of the Colorado Probate
and Trust Codes. There are definitions, understandably, that are based
on the uniform trust code, but some of Colorado's Trust Code definitions
vary from it. These issues should be easily resolved once identified. In
addition, the act's definition for nontestamentary estate planning documents
may not adequately cover the documents it should cover and should be allowed
additional consideration by various stakeholders. The act needs to be coordinated
with other Colorado laws, such as the 2019 Colorado Electronic Preservation
of Abandoned Estate Planning Documents Act, which goes into effect next
month. The bar needs to examine how electronic documents authorized under
this act would be covered under the abandoned estate documents act and
how the certification processes would work. The section would like time
to address how the act interacts and overlaps with Colorado's electronic
wills act and to consider other aspects that may not be addressed such
as due diligence requirements to discover an electronic document and liability
issues for fiduciaries and third parties for good-faith reliance on a hard
copy of a document when unaware of the existence of an electronic copy.
01:18:17 PM  

Letitia M. Maxfield with the Trusts & Estates Section of the CBA, concurred that the section would like to see if this act could be brought in conformity with Colorado law. Most important to the citizens of Colorado is for these electronic documents to be considered reliable, meaning that they can be enforced and validated without increased costs to the state and those relying on them. They need to be assured that they are free from fraud and undue influence so that when enforced the documents do not need court validation or are contested in the courts. Also, there is a need to better prepare for how to locate the documents and how quickly they can be validated and enforced, similar to how paper documents are treated statutorily. Some of the negative consequences if these documents are considered unreliable are increased legal costs, delays in the timely management of individual's assets and liabilities, clouds on title, and increased required court intervention. E-wills do not have these same issues because all wills already have a tried and true process. Most wills are prepared by lawyers and those that aren't are usually more easily detectable as potential for fraud or undue influence. These estate documents can be found online, are usually not required to be witnessed or notarized, have different execution requirements that are not found within this act, and different requirements as to revocation. Resolving disputes may require costly forensic examination of digital assets. In addition, E-wills, as with all wills, have the benefit of the harmless error doctrine so that if a harmless mistake or omission was made, the decedent's wishes can still be carried out. These documents do not have the same protections. Would like to consider that if any of the electronic documents should require notarization that they should be required to be e-notarized in Colorado, similar to E-wills. Ms. Maxfield indicated that she had prepared a written memo with more details that will be sent to the commissioners.

01:27:45 PM  

Stan Kent with the Trusts & Estates Section of the CBA, talked about the long-standing relationship of the commission with the CBA on other uniform acts such as the Uniform Probate Code in the 1990s. It was discovered that the act would make dramatic changes to Colorado law and the bar was allowed the time for a thorough study of the act to Colorado law, prepared written comparisons to Colorado law, and made suggested amendments to the act while keeping it uniform. He agreed with his colleagues that the concept and policy of the new act are good, but that there may be issues and additional time is needed to examine it and how it effects other areas within Colorado law. For example, should pre-marital and marital agreements be governed by this act? Could or should they be considered estate planning documents or otherwise enforceable under this act? The Colorado abandoned documents act mentioned earlier was not a uniform act but it was drafted in the style of a uniform law act, with a focus on definitions, many of which are in this act. There needs to be coordination in the robust body of law governing electronic estate planning documents being developed in Colorado, uniform and not uniform, which requires some time, but the bar will be diligent and will work to improve the act for Colorado law and policy while keeping it uniform

01:34:26 PM  

Commissioner Suzanne Walsh, Uniform Law Commission (ULC) and chair of the drafting committee for the act, praised Commissioner Mielke, who was also on the drafting committee, and explained that the definition section was crafted as a list in order to allow states to determine the documents that they wanted to include in that section. She explained that the impetus behind the act was that these types of documents were already being e-signed and although there is nothing preventing the e-signing of these documents, there is also currently nothing backing them up. There is increasing demand among practitioners and clients for electronic estate planning, but agreed that if additional time is needed to conform the act with Colorado statutes then they should take it. The ULC is happy to work with the section if that would be helpful. The drafting committee tried to address all the concerns that have been shared today, but the act covers a kitchen sink of documents and there are many bodies of other law that apply to the formation requirements of the documents and the committee did not think the act was necessarily the right place for altering those.

01:39:50 PM  

Commissioner Scott raised equity issue questions regarding the possibility of requiring additional attorney involvement with these types of documents and pointed out certain common documents used in Colorado simply require two witness signatures which may be able to be attained electronically through the electronic interactions described in the act. Ms. Maxfield assured the commission that she was not advocating for increased attorney involvement in these documents, but pointing out the difference in the ability to detect fraud in non-standard documents vs. standard documents. Commissioners McGihon and Mielke confirmed that the section was requesting the commission not introduce the act this session and that it would complete its analysis in time for the act's introduction in the 2024 session. Commissioner Levy shared concerns that since people are accustomed to e-signing documents and as these transactions are already occurring the delay in introduction may leave people exposed to having their e-documents not validated. The commission thanked the witnesses for their testimony and the section and the bar for their time and work on the analysis of the act.

01:46:55 PM  
Gardner moved that the Uniform Electronic Estate Planning Documents
be removed from this year's agenda and be considered for the 2024
legislative agenda. Commissioner Mielke seconded and the motion passed
6 to 1.

01:50:15 PM
Motion The Uniform Electronic Estate Planning Documents Act be removed from this year's agenda and be considered for the 2024 legislative agenda.
Moved Gardner
Alicia Duran Yes
Gardner Yes
Thomas Grimshaw Excused
Yelana Love Yes
Donald Mielke Yes
Charley Pike Excused
Sara Scott No
Tipper Excused
Claire Levy Yes
Anne McGihon Yes
YES: 6   NO: 1   EXC: 3   ABS:  0   FINAL ACTION:  PASS

The effective date for bills enacted without a safety clause is August 7, 2024, if the General Assembly adjourns sine die on May 8, 2024, unless otherwise specified. Details