Short answer

If beneficiaries dispute how estate funds should be split, the personal representative (executor/administrator) cannot simply distribute the contested money. In Virginia the usual options are: (1) seek a court order approving an interim distribution or instructions; (2) file an interpleader or petition for instructions and deposit the disputed funds with the court (court registry) or into an escrow; or (3) negotiate and get written releases from all claimants and ask the court to approve the settlement. The probate statutes and court rules that govern estate administration are in Virginia Code Title 64.2: Wills, Trusts, and Fiduciaries. See: https://law.lis.virginia.gov/vacode/title64.2/

Detailed answer — step by step under Virginia law

1) Identify authority and limits of the personal representative

The personal representative (PR) must follow the will (if any) and the Virginia probate statutes when administering the estate. Before distributing assets, the PR must pay funeral expenses, valid creditor claims, and taxes. If money is disputed by two or more claimants, the PR should not release funds to avoid personal liability without a court order or written releases from all parties. For the statutory framework see Virginia Code Title 64.2: Wills, Trusts, and Fiduciaries: https://law.lis.virginia.gov/vacode/title64.2/

2) Gather records and give required notices

Collect the will, inventory all estate assets, track bank statements, and document communications with beneficiaries and creditors. The PR must give statutory notices to beneficiaries and known creditors and file required inventories and accountings if the court requires them. Having clear records makes any petition to the court easier to support.

3) Try informal resolution first

Ask the disputing beneficiaries to sign a compromise agreement or written release that clearly identifies the distribution and releases the PR from further liability. If all interested persons sign a written settlement and the court accepts it, the PR can request a court order approving that settlement and authorizing payment.

4) If informal settlement fails: Petition the court for instructions or interim distribution

The PR can file a petition for instructions (also called a petition for directions) asking the probate court to decide how to allocate the funds. Typical requests include:

• Permission to make an interim or partial distribution to uncontested beneficiaries while holding disputed amounts;
• An order authorizing payment of specific claims (funeral, taxes, administrative costs) even when other beneficiaries dispute the division;
• Appointment of a receiver or order to deposit funds into the court registry while disputes continue.

The court will set a hearing. If the judge is satisfied the PR followed procedural requirements and that the requested distribution is reasonable, the judge can issue an order authorizing payment or directing how funds should be handled.

5) Interpleader or deposit into the court registry (escrow)

If multiple claimants assert conflicting rights to the same money, the PR can deposit the contested funds into the court registry or seek interpleader relief so the court decides who gets the money. Depositing funds removes the PR’s exposure to personal liability while the court resolves the dispute. The court may also permit the PR to pay uncontested claims and put the contested portion in escrow.

6) Settlement, mediation, or court trial

The court often encourages mediation or settlement. If mediation fails, the probate judge can hear the dispute and enter a final order allocating the funds. After a final order, the PR distributes the money according to that order and files the appropriate accounting.

7) Accounting and discharge

After distributing estate assets (including any court-approved interim distributions or distributions ordered after dispute resolution), the PR files a final accounting and asks the court to discharge them from further duties. A court-ordered distribution provides protection to the PR against later claims by beneficiaries on the matter resolved by the order.

Practical example (hypothetical)

Suppose a decedent’s bank account has $100,000. Two siblings claim the entire account: one says the will gave it all to them, the other says the will was changed orally. The PR pays funeral expenses and taxes from other assets, then files a petition for instructions asking the court to: (a) allow the PR to deposit $100,000 into the court registry; (b) schedule a hearing to determine which sibling is entitled; and (c) approve payment of any uncontested administrative expenses from estate assets. The court accepts the deposit, schedules a hearing, and later issues an order directing distribution after evaluating evidence or a settlement reached between siblings.

What courts look for

• Clear documentation that the PR followed notice and filing rules;
• An explanation of why the requested release or distribution is reasonable and necessary;
• Evidence that the PR wants to avoid personal liability and is acting in good faith.

Where to find the governing rules

Virginia’s probate and fiduciary law is codified in Title 64.2 of the Code of Virginia. For statutes and chapter listings see: https://law.lis.virginia.gov/vacode/title64.2/

When to hire an attorney

Consult an attorney if:

• The dispute involves large sums or property with unclear title;
• The PR fears personal liability for distributing funds;
• Multiple creditors or claimants create complex competing claims;
• There are allegations of undue influence, fraud, or that the will is invalid.

An attorney can prepare petitions, represent you at hearings, and advise on bonding, interpleader filings, and settlement strategies.

Helpful Hints

• Keep meticulous records: inventories, bank statements, notices, and communications with beneficiaries.
• Do not distribute contested funds without a court order or signed releases from all claimants.
• Consider depositing disputed funds into the court registry to eliminate personal exposure; the court can later order distribution.
• Ask the court for an interim distribution for uncontested parts of the estate to simplify administration.
• Propose mediation early—courts encourage settlements and it saves time and costs.
• Be prepared to show the court how you notified interested parties of hearings and filings.
• Check local circuit court forms and procedures: local courts may have required filing forms or practice preferences.

Typical timeline & costs

Timelines vary: simple interim orders may take a few weeks to a few months. Contested hearings or trials can take many months. Costs include court filing fees, attorney fees, and possible costs for mediation, expert testimony, or bond premiums. Weigh the costs of litigation versus a negotiated settlement.