Death & Estate Planning

When a property owner dies, their tokenized property needs to transfer to their heirs or estate. The Fabrica Trust addresses this directly, providing clear paths whether or not the heirs have access to the deceased owner's wallet.

This page follows v4.4 of the trust agreement. Each property is governed by the version its token referenced when it was minted, and earlier versions may differ on succession, so check your property's trust documents first.

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If Heirs Have Wallet Access

The trust agreement (Section 7.6) provides that succession follows lawful control. The person who lawfully succeeds to control of the wallet, called the Key Successor, can keep operating immediately, without a court order as a condition of continuity. Lawful succession can come through a will, a trust, intestacy, a survivorship or community-property rule, or the wallet's own recovery or succession arrangement. A Key Successor can:

• Exercise owner rights directly, including using, transferring, or selling the property
• Dissolve the trust by removing the property (burn the token, receive a deed)
• Continue holding the property as a tokenized asset

Lawfulness is what matters: merely finding someone's keys does not make access lawful, and a person who obtains access by theft is not a Key Successor.

Because the property's recorded title is held by the Fabrica Trust (not by the deceased individual), the owner's death does not itself require the land to be conveyed by a new deed; the trust continues to hold title. The beneficial interest, which is personal property under the trust agreement, passes under the estate law of the owner's domicile, and it may still be subject to estate administration, creditor claims, and estate tax depending on the jurisdiction. The agreement makes no claim of automatic probate avoidance. Property owners should consult an estate planning attorney for guidance specific to their situation.

This path requires no court order as a condition of continuing to operate the property, and no Fabrica involvement. Deeding the property out of the trust to a successor does require recorded proof of succession at that step.

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If Heirs Do Not Have Wallet Access

If the heirs cannot access the wallet, the trust agreement provides a modified version of the Token Recovery process (Section 10.3 of the trust agreement). The process follows the same self-service recovery path with these modifications:

1. Claimant identity

The claimant is the deceased owner's legal successor: an executor, administrator, or heir as determined by applicable law.

2. Proof of legal succession

Two different laws matter here, and the trust agreement (Section 10.3.2) keeps them separate:

The Notice of Lost Token Control shall be accompanied by proof of legal succession valid under the law governing the deceased Beneficiary's estate [...] in a form that the recording authority of the jurisdiction where the Property is located will accept for recording.

So the proof must be valid under the law of the estate, and in a form the county where the land sits will record. Acceptable documents include:

• Letters testamentary
• Letters of administration
• Small estate affidavit
• Any equivalent instrument recognized by local probate or succession laws

This proof is recorded together with or as an exhibit to the Notice.

3. Completion

After the 90-day Quiet Period expires without a contest and without any transaction initiated by the wallet holding the token, the legal successor steps into the position of the beneficiary. They can then direct the trustee to execute a Deed of Distribution, transferring the property out of the trust.

If the legal successor cannot obtain proof of succession in a form the recording authority will accept, the dissolution proceeds through the court order path.

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Estate Planning Recommendations

Property owners can simplify the inheritance process by taking a few steps during their lifetime:

Wallet Access

• Document wallet recovery information (seed phrases, hardware wallet locations) in a secure location accessible to your estate
• Include digital asset instructions in your estate plan or will
• Consider a multi-sig wallet where a trusted family member or attorney holds one of the required keys

Legal Preparation

• Name a trustee other than yourself, so the trust has continuity if you are incapacitated
• Inform your estate attorney that you hold tokenized real estate and provide them with a copy of the Fabrica Trust agreement
• Include the property token in your asset inventory for estate planning purposes

Tax Considerations

The trust agreement (Section 12.7) provides that "as among the parties, and to the maximum extent permitted by applicable tax law, the present Beneficiary shall at all times be treated as the owner of the Property for all federal, state, and local tax purposes." It also notes that ownership changes made without a recorded deed, including a succession, "may constitute reportable changes in ownership under applicable tax law." How estate tax applies to your property depends on your situation and the law that governs your estate: consult a tax advisor. This page is not tax advice.

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Incapacity

The trust agreement does not currently include specific provisions for incapacity (where the owner is alive but unable to manage their affairs). However:

• If the owner has granted a power of attorney that covers digital assets, the agent may be able to act on their behalf
• If the owner is under a court-appointed conservatorship or guardianship, the conservator or guardian may petition the court to manage or dissolve the trust under the court order path
• If the owner has set up a multi-sig wallet, other signers may be able to act

Estate planning for digital assets is an evolving area of law. Property owners should consult with an attorney who is familiar with both real estate and digital asset law to ensure their estate plan adequately covers tokenized property.