Legal Question in Wills and Trusts in New York

As Administrator of the estate she is entitled to a fee by law. However, where the estate only involves family charging a fee is unusual. Of course, if she spent some time handling this, she might be entitled to get it.

It is unlikely your sister in law handled this matter herself. Almost certainly she hired a lawyer to represent the estate, who negotiated the settlement with the hospital. Either you have already, or will receive, a full accounting of all monies paid into and out of the estate, along with all fees and expenses. So, I'm not sure it's accurate to say your sister is law is "charging you $5,000." I don't know what that means. Is she a lawyer? Perhaps it's the lawyer who's charging $5,000. In any event, I think you need to see the estate accounting and understand more precisely the fees and charges which are coming out of the estate.

Good luck.