What is Disbursement?

Legal Definition
A disbursement is a form of payment from a public or dedicated fund, or a payment sought from a client to pass on to a third party.

In the UK, solicitors generally refer to disbursements as payments which they have made or will make to third parties in connection with the matter they are dealing with on behalf of the client. Section 67 of the Solicitors Act 1974 refers to disbursements as "costs payable in discharge of a liability properly incurred by [the solicitor] on behalf of the party to be charged with the bill". These may include court fees, counsel's fees, fees for medical or other expert reports or search fees in a property transaction.

Disbursements paid by an undertaker on behalf of a bereaved family generally include cemetery or crematorium costs, costs for religious worship and any news paper announcements.

For VAT purposes, disbursements are defined more narrowly.
-- Wikipedia
Legal Definition
Literally, to take money out of a purse. Figuratively, to pay out money; to expend money; and some times it signifies to advance money.

2. A master of a ship makes dishursements, whether with his own money or that of the owner, when he defrays expenses for the ship.

3. An executor, guardian, trustee, or other accountant, is said to have made dishursements when he expended money on account of the estate which he holds. These, when properly made, are always allowed in the settlement of the accounts.
-- Bouviers Law Dictionary
Legal Definition
Money expended by an executor, guardian, trustee, etc., for the benefit of the estate in his hands or in connection with its administration. The term is also used under the codes of civil procedure, to designate the expenditures necessarily made by a party in the progress of an action, aside from the fees of officers and court costs, which are allowed, eo nomine, together with costs. Fertilizer Co. v. Glenn, 48 S. C. 494, 26 S. E. 796; De Cham-brun v. Cox, 60 Fed. 479, 9 C. G A. 86; Bil-yeu v. Smith, 18 Or. 335, 22 Pan. 1073.
-- Black's Law Dictionary