Probate Q&A Series

How do I collect my spouse’s personal injury settlement through estate administration? – North Carolina

Short Answer

In North Carolina, only a court‑appointed personal representative (PR) can receive and distribute a decedent’s personal injury or wrongful death settlement. The surviving spouse usually has first priority to serve as PR, but you must open an intestate estate with the Clerk of Superior Court and obtain Letters of Administration. Any wrongful death settlement must be approved by the court before distribution; survival (personal injury) proceeds become estate assets and are paid out under North Carolina’s creditor and heir rules.

Understanding the Problem

You want to know how, in North Carolina probate, you can collect your deceased spouse’s personal injury settlement. You, as the surviving spouse, need authority to act for the estate because your spouse died without a will. The single decision point is: how to be appointed and use that authority to lawfully receive and distribute the settlement.

Apply the Law

Under North Carolina law, claims related to injury can take two paths after death. A “survival” claim for the decedent’s personal injury belongs to the estate and is handled like any other estate asset. A “wrongful death” claim belongs to statutory beneficiaries but must be brought and settled by the PR, and any settlement must be approved by the court. The Clerk of Superior Court has original jurisdiction over estate administration, and the county of the decedent’s domicile is the usual venue. The surviving spouse has priority to serve as administrator in an intestate estate, subject to qualification requirements (including bond unless excused). After qualification, the PR gives notice to creditors and marshals assets, including settlements. Wrongful death proceeds are applied first to approved expenses (including limited medical and funeral amounts) and then distributed per the intestacy scheme; survival proceeds are general estate assets subject to creditor claims.

Key Requirements

  • Appointment and Letters: You must qualify as personal representative (administrator) with the Clerk of Superior Court in the decedent’s county of domicile and obtain Letters of Administration before collecting any settlement.
  • Spouse’s Priority: In an intestate estate, the surviving spouse has first priority to serve, subject to being qualified and to any bond requirements.
  • Wrongful death approval: Any wrongful death compromise or settlement must be approved by the court before funds are distributed; minors’ interests require special protection.
  • Classifying the claim: Survival (personal injury) proceeds become estate assets subject to creditors; wrongful death proceeds are not general estate assets and, after limited deductions, are distributed to heirs by statute.
  • Notice to creditors: After qualifying, publish and mail required notices; the bar date for claims generally runs at least three months from first publication.
  • Venue and multi‑state assets: File in the North Carolina county of domicile; if assets or administration exist in another state, ancillary administration rules may apply.

What the Statutes Say

Analysis

Apply the Rule to the Facts: Because your spouse died without a will, you apply to serve as administrator; as surviving spouse, you have priority to be appointed. Once you have Letters of Administration, you may receive any settlement. If the settlement is for a survival claim, it becomes an estate asset and is subject to creditor claims before distribution to you and the child under intestacy. If it is a wrongful death settlement, you obtain court approval, pay the limited statutory expenses, and then distribute the balance to heirs per statute rather than to general creditors.

Process & Timing

  1. Who files: Surviving spouse. Where: Clerk of Superior Court in the North Carolina county of the decedent’s domicile. What: Application for Letters of Administration (AOC‑E‑202), death certificate, any required bond, and heir information. When: As soon as practicable; after qualification, publish notice to creditors within about 30 days, and creditors generally have at least three months from first publication to present claims.
  2. Settlement step: Notify the injury attorney/insurer that you have qualified. For wrongful death, file the necessary petition for court approval of the compromise and proposed distribution; allow time for clerk or court review, and for any guardian ad litem appointment if a minor’s interest is affected.
  3. Collect and distribute: Deposit settlement into the estate account. For survival proceeds, pay valid claims and costs, then distribute under intestacy. For wrongful death proceeds, pay court‑approved medical/funeral amounts within statutory limits and distribute the remainder to heirs per statute. File required inventories and a final account to close the estate.

Exceptions & Pitfalls

  • Misclassifying the claim: survival vs. wrongful death affects creditor exposure and distribution; allocate correctly and seek court approval where required.
  • Skipping approval: do not distribute a wrongful death settlement without court approval and, if a minor heir is involved, without appropriate representation safeguards.
  • Bond and notices: confirm whether bond is required; complete renunciation/notice steps if others have equal or higher appointment rights.
  • Joint or transferred accounts: if estate assets are insufficient, the PR may have limited rights to recover a portion of survivorship funds to pay allowed claims; handle carefully.
  • Multi‑state complications: if property or prior administration exists outside North Carolina, you may need ancillary steps; confirm venue and coordinate before filing.

Conclusion

To collect your spouse’s personal injury settlement in North Carolina, first qualify as personal representative and obtain Letters of Administration. Only the PR can receive and distribute settlement funds. Wrongful death settlements require court approval and, after limited expenses, pass to heirs; survival proceeds are estate assets subject to creditor claims before intestate distribution. Next step: file the Application for Letters of Administration with the Clerk of Superior Court in the decedent’s county of domicile.

Talk to a Probate Attorney

If you’re dealing with opening an estate and collecting a personal injury or wrongful death settlement, our firm has experienced attorneys who can help you understand your options and timelines. Call us today at 919-341-7055.

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.