MARIAN PIKULA v. DEPARTMENT OF SOCIAL SERVICES, SC 19533

Judicial District of New Britain

 

       Administrative Appeals; Trusts; Medicaid; Whether Trial Court Properly Determined that, Under Primary Jurisdiction Doctrine, Agency not Bound by Probate Court Determination that Trust Assets Unavailable; Whether Trust a General Support Trust or Supplemental Needs Trust.  The plaintiff is a beneficiary of a testamentary trust established by her father.  She applied for Medicaid benefits, and the defendant denied her application on the ground that her assets, including the trust, exceeded eligibility levels.  The plaintiff sought a hearing to contest the denial, claiming that the trust should not have been considered because it was not actually available to her.  During the pendency of the hearing process, the Probate Court held that the trust was a supplemental needs trust, in which the trustee retains unfettered discretion to withhold the income, and therefore that the plaintiff could not compel the trustee to make distributions.  Shortly thereafter, the defendant affirmed its denial of benefits, holding that the trust was a general support trust, in which the beneficiary can compel distribution of the trust income, and that the trust was therefore actually available to the plaintiff for purposes of determining her Medicaid eligibility.  The plaintiff appealed to the trial court, claiming that the doctrine of collateral estoppel, or issue preclusion, prevented the defendant from determining that the trust was a general support trust instead of a supplemental needs trust, as the Probate Court had determined.  In the alternative, the plaintiff claimed that the defendant wrongly determined that the trust was a general support trust.  The trial court affirmed the defendant’s decision.  In rejecting the plaintiff’s collateral estoppel argument, the court held that the defendant agency was not bound by the Probate Court’s decree because the defendant had primary jurisdiction over the Medicaid eligibility issue.  The primary jurisdiction doctrine states that a court should not act upon subject matter that is peculiarly within an agency’s specialized field without giving the agency an opportunity to apply its expertise.  The trial court also held that the defendant properly deemed the trust a general support trust because the trust language required the trustee to distribute as much of the trust income for the plaintiff’s maintenance and support as he deemed advisable and to consider the plaintiff’s other assets before making such distributions.  The trial court observed that a supplemental needs trust, in contrast, does not place such limitations on a trustee’s discretion to make distributions.  The plaintiff appeals, and the Supreme Court will decide whether the trial court properly held that the defendant was not collaterally estopped by the Probate Court’s trust interpretation because it had primary jurisdiction over the issue of interpreting the trust for purposes of determining the plaintiff’s Medicaid eligibility.  The Supreme Court will also decide whether the trial court properly held that the trust was a general support trust such that it was available to the plaintiff for purposes of determining her Medicaid eligibility.