Dec32025
Surplus Funds Q&A Series

What does the commissioner’s percentage cover, and can that amount be reduced or challenged? – North Carolina

Short Answer

In North Carolina surplus-funds cases, a commissioner’s percentage is a court-approved commission paid from the fund for handling the sale or distribution, including collecting the money, accounting, reporting to the court, and arranging payments. The judge or clerk of superior court has authority to set and approve this compensation and is not locked into any informal “standard” percentage. If the requested commission appears excessive or not tied to actual work or risk, an interested party may object and ask the court to reduce or disallow part of it.

Understanding the Problem

The question in a North Carolina surplus funds proceeding is: what does the commissioner’s percentage actually pay for, and is there any way to contest that amount before funds are distributed? In these matters, a commissioner is often appointed to conduct a court-ordered sale or to receive, manage, and disburse sale proceeds that end up as surplus after liens are paid. When the case reaches the stage where attorney’s fees and the commissioner’s percentage are presented to the court for approval, the remaining recipients want to know whether that “standard” commission is automatic, or whether North Carolina law allows the court to adjust it based on the work done and the size of the fund.

Apply the Law

Under North Carolina law, when a commissioner or similar officer conducts a judicial sale or holds funds for the court, compensation is treated as part of the costs and expenses of the proceeding, subject to court oversight. The clerk of superior court or a judge decides what is reasonable, taking into account the nature of the sale, the amount of money handled, the risk and responsibility assumed, and the work performed. The court may set a percentage as a convenient method of calculating compensation, but it is not required to accept an off-the-shelf “standard” rate if the facts do not justify it.

Key Requirements

  • Court appointment and role: The person must be acting as a commissioner or similar officer under a North Carolina court order, typically to conduct a sale or hold and distribute proceeds.
  • Court approval of compensation: The clerk of superior court or a judge fixes the amount of the commissioner’s compensation and orders payment out of the sale proceeds or surplus funds.
  • Payment from the fund: The commission is treated as a cost or expense of the proceeding and is paid before remaining surplus funds are distributed to recipients.
  • Reasonableness standard: The court must ensure the compensation is reasonable in light of the services performed and responsibilities assumed, not just mechanically tied to a percentage.
  • Right to be heard: Interested parties may raise objections to requested commissions or fees when the court considers approval, and the court can reduce or adjust them.

What the Statutes Say

Analysis

Apply the Rule to the Facts: Here, the commissioner is taking a stated percentage out of court-held surplus funds before distribution to several recipients. Under North Carolina law, that percentage functions as compensation for conducting or managing the sale process, receiving and safeguarding funds, accounting to the court, and arranging disbursements. Because a judge or clerk must approve the amount, the commissioner’s “standard” cut is not automatic; it is subject to a reasonableness review and may be adjusted. If the work performed and risks assumed appear modest compared to the requested commission, an interested recipient can ask the court to reduce it at or before the fee-approval hearing.

Process & Timing

  1. Who files: An interested recipient of surplus funds. Where: In the same North Carolina Superior Court file where the sale and surplus funds are pending, with the Clerk of Superior Court. What: A written objection or motion addressing the commissioner’s requested percentage and any related attorney’s fees, asking the court to fix reasonable compensation. When: Before or at the scheduled hearing at which fees and commissions will be presented for approval; local practice often expects written objections a few days in advance.
  2. The court (usually the Clerk of Superior Court) conducts a brief hearing, hears from the commissioner and any objecting parties, reviews time, effort, risk, and size of the fund, and then fixes the commissioner’s compensation, which may or may not match any asserted “standard” percentage.
  3. After the court enters a written order setting fees, commissions, and distributions, the statutory notice/appeal period runs; once that expires without appeal, the clerk or county finance office issues checks to recipients, and the court may allow in-person pickup consistent with local procedures.

Exceptions & Pitfalls

  • Some courts follow informal percentage benchmarks for commissioners in certain types of sales; while not binding, they can influence what the court views as reasonable.
  • Failing to appear at the fee hearing or to file a clear written objection can make it harder to challenge the commission later.
  • Once the order approving the commissioner’s percentage becomes final after the appeal period, later challenges are very limited and may require a formal appeal or motion for relief from judgment.
  • Objecting only to the size of the percentage, without offering facts about the work performed or alternatives, may carry less weight with the clerk than a focused, fact-based challenge.
  • Local practices on in-person check pickup versus mailing can vary; misunderstanding those procedures does not affect the validity of the commissioner’s compensation but can delay receipt of funds.

Conclusion

In North Carolina surplus funds matters, a commissioner’s percentage is a court-approved commission that pays for handling the sale and safeguarding and distributing the proceeds, and it is treated as a cost of the proceeding paid before surplus funds reach recipients. The clerk or judge must fix this compensation and is not bound by any informal “standard” percentage. Anyone with an interest in the surplus can ask the court to review and, if appropriate, reduce the requested amount by filing an objection in the same case before or at the fee-approval hearing.

Talk to a Surplus Funds Attorney

If you’re dealing with court-held surplus funds and a commissioner’s percentage that affects the final distribution, 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.

Category: Surplus Funds Q&A Series

Author: jpierce

Attorney Jared Pierce is the founder of Pierce Law Group in Raleigh, North Carolina, a firm he established with a dedicated focus on probate administration and estate planning across North Carolina. Born and raised in the Republic of South Africa, Jared moved to Durham with his family in 2001, bringing with him a rich cultural background and a distinctive accent that often serves as a conversation starter.