How to Protect Wrongful Death Settlement Money by Depositing It with the Court Clerk in Alabama

Quick overview: If you are handling a pending wrongful death settlement in Alabama and worry about protecting the settlement proceeds while issues (distribution, liens, or claims) are resolved, one common step is to ask the court to approve deposit of the funds into the court registry (the clerk of court). This article explains how that generally works in Alabama, what steps you should take, and what problems to watch for. This is educational information only and is not legal advice.

Detailed answer — how to secure proceeds through the clerk in Alabama

Alabama wrongful death claims are governed by the Alabama wrongful death statutes (Title 6, Chapter 5 of the Code of Alabama). If parties agree to a settlement but there are unresolved claims, disputes about who is entitled to the money, possible liens, or concerns about minors or incapacitated beneficiaries, a common and effective protective measure is to have the settlement funds deposited with the court clerk (the court registry) under court order.

Below are the typical steps and legal considerations for securing settlement proceeds through the clerk in Alabama:

1. Confirm who has legal authority to accept and disburse the funds

Under Alabama wrongful death law, a wrongful death action is prosecuted for the benefit of certain beneficiaries and distribution rules apply. Before depositing funds, identify the plaintiff(s) and any personal representative whose authority to accept or distribute proceeds may be required. If an estate or probate process will affect distribution, coordinate with the personal representative or probate court.

(See generally Alabama Code, Title 6, Chapter 5 for wrongful death provisions.) For an official starting point, search the Alabama Code on the Alabama Legislature website: https://www.legislature.state.al.us/

2. Resolve or preserve potential liens and subrogation claims

Health-care providers, Medicare/Medicaid, ERISA plan administrators, and funeral homes can assert liens or subrogation claims against settlement proceeds. Before money is released, you should identify known lienholders and either negotiate payoffs or present the liens to the court when asking to deposit funds with the clerk. If claims are disputed, the court can allow deposit while disputes are resolved.

3. File a motion or petition asking the court to approve the settlement and permit deposit

To put funds into the registry, the usual procedure is to file a motion or petition with the court that has jurisdiction over the lawsuit or over the wrongful death settlement (often the civil court where the case was filed). The motion typically asks the judge to:

• Approve the settlement (if court approval is required or advisable);
• Authorize the plaintiff(s) or settling parties to deposit settlement proceeds into the court registry (the clerk of court); and
• Direct the clerk to hold the money and distribute it only on further order of the court, to pay identified liens or costs, or to pay a personal representative after probate steps are complete.

The motion package often includes the settlement agreement, the proposed release(s), an accounting of expected distributions and liens, affidavits from counsel, and a proposed court order directing the clerk to accept and hold the funds.

4. Clerk procedures and requirements vary by county

Each county clerk may have local rules about how to tender funds (check, wire), what paperwork is required, how funds are tracked, and whether the registry pays interest or charges administrative fees. The order from the judge will direct the clerk to accept funds and will usually specify when the clerk can disburse and to whom.

5. Special issues: minors, incapacitated beneficiaries, and estates

If a beneficiary is a minor or legally incapacitated, Alabama courts commonly require extra protections (court approval, appointment of a guardian or conservator, or a dedicated minor’s compromise order) before releasing funds. If the decedent’s estate is open or probate will control distribution, the court may require coordination with the probate process or require funds to be paid to an estate representative.

6. If parties disagree about entitlement, consider interpleader or an escrow order

If multiple claimants assert rights to the same settlement funds, the court can permit deposit and then resolve competing claims. In some cases a defendant or insurer will file an interpleader action (or ask the court to accept funds into the registry) to avoid multiple liability. The court then determines the rightful recipients or authorizes distribution on resolution of disputes.

7. What the court order should address

A clear order limits confusion. It should state who may deposit the money, name the clerk and the case number, specify how long the clerk will hold the funds, state whether interest will accrue, list any authorized disbursements (attorney fees, liens, funeral costs, distributions), and explain how claimants can seek release of funds. The judge may also require periodic accounting to the court.

8. Practical timeline and costs

After the judge signs an order, the settling party deposits funds per the clerk’s instructions. The clerk posts the funds, gives a receipt, and follows the order for disbursement. Courts and clerks may charge registry fees or retain a small administrative charge. Resolving lien disputes, probate steps, or guardian appointments can take weeks to months depending on complexity.

When to hire an attorney

Because wrongful death settlements often involve multiple beneficiaries, lien claims, and possible probate or guardianship issues, an experienced Alabama civil or probate attorney can:

• Create and present the deposition-to-clerk motion and proposed order;
• Identify and negotiate lien claims and subrogation;
• Coordinate with the probate court when estates or personal representatives are involved; and
• Protect minors and incapacitated persons through appropriate court procedures.

Relevant Alabama law and official resources

The wrongful death statutory framework appears in the Code of Alabama (Title 6, Chapter 5). For the official text of Alabama statutes and to locate the exact sections that apply, use the Alabama Legislature website and search for Title 6, Chapter 5 (Wrongful Death): https://www.legislature.state.al.us/

Because local clerk procedures and county rules differ, check the clerk of court’s website in the county where your case is pending or contact the clerk’s office directly for registry deposit instructions. For statewide court rules and guidance, visit the Alabama Judicial System site: https://judicial.alabama.gov/

Helpful hints

• Gather paperwork before you file: settlement agreement, releases, identification for payees, and any lien notices.
• List anticipated claimants and known lienholders in your motion so the court knows who to notify.
• Ask the clerk what forms and payment methods they accept; ask about fees and whether the registry pays interest.
• If minors are beneficiaries, ask the court for a plan to protect their share (guardianship, blocked account, or court-ordered disbursement schedule).
• Resolve Medicare/Medicaid and other liens early. Federal or state health programs may assert reimbursement claims.
• If parties disagree, consider an interpleader or ask the court to retain the funds while disputes are litigated.
• Keep written receipts and court orders in the case file; the clerk will provide a receipt when accepting funds.
• Expect some delay—resolving liens, probate issues, or contested claims can substantially extend the timeline.

Disclaimer: This article explains general principles of Alabama law and common court practices. It is educational only and does not constitute legal advice. Consult a qualified Alabama attorney to apply these concepts to your specific situation.