In a wrongful death case, sometimes the party that caused the accident will pay the settlement with one check for the entire case. If this happens, the personal representative has to divide the case between the estate and the survivors fairly.
Example
Ben is killed in a car accident when Luis ran a red light and hit Ben’s car. Ben is not married at the time of the crash. Ben has 3 children – Mike, Sandra and Peter. Manny is appointed as a personal representative. Luis has one million dollar ($1,000,000) of bodily injury liability limits on his car insurance policy, which is insured with State Farm Insurance Company. State Farm knows because Ben was not married at the time of his death, all the children and even adult children can get money for pain and suffering, in addition to other damages.
Because the amount of money awarded for pain and suffering for the loss of a parent can be so big, State Farm realizes that the case is worth more than $1,000,000. State Farm sends a check to the personal representative, Manny. Manny now must fairly divide up the money between the 3 survivors – Mike, Sandra and Peter – and the Estate. So Manny can divide the $1,000,000 settlement by giving $320,000 to Mike, $320,000 to Sandra, $320,000 to Peter, and the remaining $40,000 to the estate.
Now, if the personal representative is also one of the people making a claim in the wrongful death claim, there could be a conflict between the personal representative being fair with deciding how much money each survivor and the estate get. If there is a conflict of interest, the best practice is for the court to nominate an administrator ad lite to deal with the settlement of the claim and decide how much money each of the claimants gets.
Example
Ben is killed in a car accident when Luis ran a red light and hit Ben’s car. Ben has a brother Frank. Frank is chosen to be the personal representative of Ben’s estate. Frank makes a bodily injury claim – for the Ben’s kids and parents – against Luis’s car insurance company, State Farm. Ben has one million dollar ($1,000,000) of bodily injury liability limits on his car insurance policy that is insured with State Farm Insurance Company.
Although most car insurance companies issue 1 check to settle a personal injury or wrongful death case, State Farm offers $100,000 of the $1,000,000 bodily injury insurance policy. Frank asks the court to approve a partial settlement. Frank tells the court that the Ben’s hospital bill is $200,000. Assume the total value of the wrongful death case is $1,000,000, but as mentioned at this time State Farm has offered only $100,000. Frank cannot say that each of the survivors gets $33,333 and the estate gets nothing. Frank – the personal representative – must divide the $100,000 fairly between the 3 children and the estate. So, perhaps Frank can say that each survivor gets $20,000 (total of $60,000 for all 3 survivors) and the hospital gets $40,000.
How did or do you determine how much money each survivor would get in a wrongful death case?