How Are Wrongful Death Settlements Paid Out?

In South Carolina, wrongful death cases can have two different types of claims: a wrongful death action and a survival action. Each has its own rules for how settlements are paid out. We’ll explain both to help you understand what to expect.

South Carolina law specifically outlines who can receive compensation from a wrongful death settlement. To understand how a wrongful death settlement may pay out in your specific case, speak with a Charleston wrongful death lawyer for legal advice.

Understanding Wrongful Death vs. Survival Actions

A wrongful death action compensates the family members for their losses after their loved one’s death, such as lost financial support and emotional suffering. The executor or administrator brings this type of claim, and the recipients of the award are the statutory beneficiaries.

A survival action compensates the estate for the deceased person’s losses before death, including medical bills, lost wages, and pain and suffering. These funds become part of the estate and are distributed according to estate law.

Each type of action serves a different purpose, and in many cases, both types of claims may be pursued simultaneously. We can help determine which claims apply to your situation.

Who Can Receive Wrongful Death Settlement Money?

South Carolina law (Section 15-51-20) outlines who can receive compensation from a wrongful death settlement. According to probate law, the state follows a strict hierarchy for distributing these funds.

Settlement proceeds go first to the surviving spouse and children. If no spouse or children exist, the deceased person’s parents are next in line to receive compensation.

The settlement may go to siblings or other heirs in cases with no surviving spouse, children, or parents. The court may limit or deny a parent’s share if they failed to reasonably provide support to the deceased as a child. 

How Are Wrongful Death Settlements Approved?

Under South Carolina law, all wrongful death and survival action settlements must be approved by either the probate court, circuit court, or United States District Court.

Only a properly appointed personal representative has the authority to settle these claims with the court. This requirement ensures that the interests of all beneficiaries are protected.

The court will review the settlement terms, including attorney fees and costs, to ensure they are fair and reasonable for all parties involved.

Paying Out the Wrongful Death Settlement

Wrongful death settlements are paid out according to South Carolina’s intestacy laws. This means the money is divided as if the person died without a will.

Before distributing funds to beneficiaries, the personal representative must account for any outstanding medical bills, funeral expenses, and other estate debts. If there is no survival action, as in the case of instantaneous death, these debts may need to be paid from the wrongful death settlement first.

What About Taxes and Fees?

Understanding the tax implications and legal fees associated with wrongful death settlements helps you plan for the future and avoid surprises.

In most cases, wrongful death settlements are not taxable under federal law. However, certain portions of the settlement, such as punitive damages, may be subject to taxation.

Legal fees for a wrongful death settlement are typically paid on a contingency basis, meaning they’re deducted from the settlement amount only after it’s received. The court must approve these fees as part of the settlement.

What if Beneficiaries Disagree?

When beneficiaries dispute the distribution of a wrongful death settlement, South Carolina courts have specific procedures to resolve these conflicts. The personal representative must notify the court of any disputes among beneficiaries.

Mediation is often required before the court will hear arguments about distribution. This process allows beneficiaries to work with a neutral third party to reach an agreement, which can save time.

If mediation fails, the court will hold a hearing to determine fair distribution based on South Carolina law. Each beneficiary has the right to present evidence supporting their claim to the settlement funds.

How Are Minor Beneficiaries Protected?

South Carolina courts use additional safeguards when a wrongful death settlement includes minor beneficiaries. The court typically appoints a guardian ad litem to represent the minor’s interests during settlement proceedings.

For larger settlements, the court often requires the creation of a trust or structured settlement to protect the minor’s share until they reach adulthood. These arrangements can include provisions for education and healthcare while preserving the principal amount.

The court must approve disbursements from a minor’s settlement funds, and the personal representative must provide regular accountings. This oversight continues until the minor reaches the age of majority.

Get Help With Your Wrongful Death Claim

If you’ve lost a loved one due to someone else’s negligence, you deserve compassionate legal guidance through the settlement process, including after you win. Our lawyers can help the personal representative understand how wrongful death settlements are paid out.

Contact the Charleston personal injury lawyers at Miller, Dawson, Sigal & Ward today for a free consultation about your wrongful death claim. We’ll explain your rights, answer your questions, and help you understand what to expect from the settlement process.