Short Answer

In North Carolina, wrongful death proceeds are not estate assets and must be distributed by statute to the heirs who would take under intestate succession unless all competent adult takers sign a written agreement or a court orders otherwise. An oral agreement is usually not enough for the personal representative to deviate from the statute. To enforce or dispute an alleged oral deal, parties should move promptly in the court process that approves the settlement and distribution, or file an estate proceeding so the court can decide and, if needed, order funds held by the clerk until the dispute is resolved.

How North Carolina Law Applies

Wrongful death proceeds belong to the statutory beneficiaries, not to the decedent’s probate estate. By default, the personal representative must first pay limited, allowed expenses (like funeral and capped medical bills), then distribute the balance to heirs under North Carolina’s intestacy rules. A personal representative cannot rely on an oral side agreement to reallocate those shares. If all beneficiaries are competent adults and wish to divide differently, they should sign a written agreement or assignments/disclaimers. If any beneficiary is a minor, incapacitated, unknown, or unborn, a judge must approve any deviation and a guardian ad litem is typically appointed to protect those interests. Courts also require judicial approval of wrongful death settlements when not all competent adult beneficiaries consent in writing, and the judge may address distribution issues at that time. If a dispute arises, the personal representative should not commingle the proceeds with estate funds and can ask the court to approve an accounting and deposit disputed shares with the clerk pending a ruling.

Key Requirements

• Distribution rule: After allowable expenses, wrongful death proceeds must be distributed to the heirs under the intestacy statute. The personal representative cannot change this based on an oral agreement. Written, signed consents by all competent adults or a court order are required to deviate.
• Settlement approval: A judge must approve a wrongful death settlement unless every competent adult beneficiary signs a written consent. If minors or incapacitated persons have an interest, a guardian ad litem and judicial approval are required; oral agreements cannot waive those rights.
• Liens and expenses: Before distribution, the personal representative must address funeral costs and medical bills related to the fatal injury within statutory caps, as well as certain government reimbursement rights (for example, Medicare and Medicaid where applicable). The clerk reviews and approves qualifying medical claims.
• Separate handling and accounting: Wrongful death proceeds must be kept separate from estate assets. The clerk can require a separate accounting and can order deposit of disputed funds with the court.
• Court forum: Disputes over distribution can be brought as an estate proceeding before the clerk of superior court. The clerk can order an accounting, facilitate mediation, and decide issues; appeals go to superior court. If broader relief is needed, a declaratory judgment in superior court may be appropriate.

Process & Timing

1. Confirm beneficiaries and shares: Identify who takes under intestacy (spouse, children, parents, etc.) and whether any person is a minor or incapacitated. Screen for potential disqualifying acts and slayer issues; these can change who receives funds.
2. Settlement approval: The personal representative seeks court approval of any wrongful death settlement unless all competent adult beneficiaries have signed written consents. If minors or incapacitated persons have interests, expect a guardian ad litem and judicial review.
3. Address liens and allowed expenses: Resolve Medicare/Medicaid and State Health Plan reimbursement where applicable and pay allowable funeral and qualifying medical bills within statutory limits before distribution.
4. Written agreement if deviating: If the family wants to divide differently than the statute, convert any oral understanding into a written agreement signed by all competent adult beneficiaries. If minors are involved, seek court approval. The personal representative should not rely on an oral promise.
5. File an estate proceeding if there’s a dispute: Any beneficiary or the personal representative may file a petition before the clerk to approve distribution, compel an accounting, or order deposit of disputed shares with the clerk. The clerk may order mediation. The clerk’s written order is appealable to superior court.
6. Distribute and account: After the court resolves disputes or approves a written agreement, the personal representative distributes according to the order or consents and files a separate wrongful death accounting if required. The court can allow or require deposits for minors (for example, with the clerk or under UTMA/guardianship), and may tailor protections.

What the Statutes Say

• N.C. Gen. Stat. § 28A-18-2: Governs wrongful death claims, allowed payments (funeral and limited medical), and requires distribution of the balance to heirs under intestacy.
• N.C. Gen. Stat. § 28A-13-3: Authorizes the personal representative to compromise or settle wrongful death claims; requires judicial approval unless all competent adult beneficiaries consent in writing.
• N.C. Gen. Stat. § 28A-2-6: Sets procedures for estate proceedings before the clerk, including petitions, summons, service, hearings, and appeals.
• N.C. Gen. Stat. § 28A-2-10: Allows the clerk to approve certain settlement agreements within the clerk’s jurisdiction, with limits; useful guidance for resolving estate-related controversies.
• N.C. Gen. Stat. § 29-14 and § 29-15: Define who inherits under intestate succession, which controls who receives wrongful death proceeds after allowed expenses.
• N.C. Gen. Stat. § 28A-22-7: Provides options for paying a minor’s share (for example, to a parent/guardian up to statutory limits) when appropriate.
• N.C. Gen. Stat. § 28A-23-2: Allows paying a legacy or distributive share into the clerk’s office, which is often used to hold disputed or protected funds.
• N.C. Gen. Stat. § 7A-38.3B: Authorizes mediation in matters before the clerk, including estate proceedings.
• N.C. Gen. Stat. § 108A-57: Addresses Medicaid liens and reimbursement, which can affect wrongful death distributions.
• N.C. Gen. Stat. § 135-48.37: Addresses State Health Plan subrogation rights against third-party recoveries.
• N.C. Gen. Stat. § 1-253: Declaratory Judgment Act; allows a court to determine rights when distribution questions arise.
• N.C. Gen. Stat. § 28A-14-1: Notice to creditors; publication is not required if the only asset is a wrongful death claim.

Exceptions & Pitfalls

• Oral agreements rarely control: The personal representative risks surcharge if they distribute contrary to statute based on an oral deal. Use a written, signed agreement or obtain a court order.
• Minors and incapacitated persons: You cannot bind these beneficiaries with an oral agreement. Expect a guardian ad litem and court approval; funds may be restricted or deposited with the clerk.
• Liens first: Medicare, Medicaid, and certain plan subrogation rights must be addressed. Medical bills related to the fatal injury are capped by statute, and the clerk approves qualifying claims.
• Do not commingle: Keep wrongful death funds in a separate account from estate assets. File a separate wrongful death accounting if required.
• Contract claims vs. probate process: A beneficiary trying to enforce an oral promise may sue on the contract between beneficiaries, but that does not authorize the personal representative to deviate from the statute absent a court order.
• Confidentiality: Courts can limit disclosure of settlement terms in the estate file, but you must still document required disbursements and beneficiary receipts as directed by the court.

Helpful Hints

• Put any family agreement in writing, signed by every competent adult beneficiary, and consult counsel before funds are disbursed.
• Ask the court to appoint a guardian ad litem early if any beneficiary is a minor, unascertained, or incapacitated.
• Provide the court with a clear proposed allocation showing statutory shares, liens, allowed expenses, and any requested deviations with signed consents.
• If a dispute surfaces, request an order to deposit the contested shares with the clerk to protect everyone while the court decides.
• Keep settlement funds in a dedicated account and maintain receipts, releases, and lien resolutions for the separate wrongful death accounting.

Talk to a Probate Attorney

If you’re dealing with a disagreement over how to split wrongful death proceeds—or need to convert an oral understanding into a court‑approved 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.