Pikula v. Dept. of Social Services ( 2016 )

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MARIAN PIKULA v. DEPARTMENT OF
SOCIAL SERVICES
(SC 19533)
Rogers, C. J., and Palmer, Zarella, Eveleigh, McDonald, Espinosa and
Robinson, Js.
Argued January 25—officially released May 10, 2016
J. Colin Heffernan, with whom, on the brief, was
John C. Heffernan, for the appellant (plaintiff).
Patrick B. Kwanashie, assistant attorney general,
with whom, on the brief, was George Jepsen, attorney
general, for the appellee (defendant).
Opinion
EVELEIGH, J. The plaintiff, Marian Pikula, appeals
from the judgment of the trial court dismissing her
appeal from the decision of an administrative hearing
officer for the defendant, the Department of Social Ser-
vices (department),1 denying her application for bene-
fits under the state administered Medicaid program
(Medicaid)2 because her assets, in the form of a testa-
mentary trust, exceeded prescribed Medicaid limits. We
conclude that the trial court should not have dismissed
the appeal on the ground that the hearing officer cor-
rectly determined that the trust was an asset available
to the plaintiff. Accordingly, we reverse the judgment
of the trial court.
The following undisputed facts, as found by the trial
court, are relevant to this appeal. ‘‘In 1989, John Pikula,
the plaintiff’s father, executed a will containing a testa-
mentary trust for his two daughters: Dorothy McKee
and the plaintiff. When John Pikula died in 1991, the
trust became effective and the Probate Court appointed
a trustee.’’
The testamentary language creating the trust pro-
vided as follows: ‘‘A. Until [the plaintiff] shall die, the
[t]rustee shall pay to or spend on behalf of [the plaintiff]
as much of the net income derived from this trust fund
as the [t]rustee may deem advisable to provide properly
for [her] maintenance and support and may incorporate
any income not so distributed into the principal of the
fund at the option of the [t]rustee.
‘‘B. I hereby authorize and empower the [t]rustee in
his sole and absolute discretion at any time and from
time to time to disburse from the principal for any of
the trust estates created under this [will], even to the
point of completely exhausting the same, such amount
as he may deem advisable to provide adequately and
properly for the support and maintenance of the current
income beneficiaries thereof, any expenses incurred
by reason of illness and disability. In determining the
amount of principal to be so disbursed, the [t]rustee
shall take into consideration any other income or prop-
erty which such income beneficiary may have from
any other source, and the [t]rustee’s discretion shall be
conclusive as to the advisability of any such disburse-
ment and the same shall not be questioned by anyone.
For all sums so distributed, the [t]rustee shall have
full acquittance.’’
In March, 2012, the plaintiff entered a long-term care
facility. At that time, she applied for financial and medi-
cal assistance under Medicaid. At the time she applied
for Medicaid benefits, the trust value was approxi-
mately $169,745.91. In May, 2013, the department denied
the plaintiff’s application for Medicaid benefits on the
ground that her assets, including the trust, exceeded
the relevant asset limits.
The plaintiff then requested a hearing to contest the
department’s decision. The hearing occurred in Octo-
ber, 2013. Thereafter, on December 20, 2013, the hearing
officer issued a decision upholding the department’s
denial of the plaintiff’s Medicaid benefits because the
trust was an asset that was available to her and, there-
fore, her assets exceeded the regulatory limits.
The plaintiff subsequently requested reconsideration
of the decision pursuant to General Statutes § 4-181a
(a) (1) (A). Her motion was denied. Pursuant to General
Statutes §§ 17b-61 and 4-183, the plaintiff appealed from
the hearing officer’s decision to the Superior Court.
In her complaint, the plaintiff alleged, inter alia, that,
under the terms of the department’s policy manual and
applicable case law, the trust assets are not available
to the plaintiff. Specifically, the plaintiff asserted that,
under the terms of the trust, the assets of the trust are
not available to her because she is not entitled to receive
trust principal and the trustee has sole and absolute
discretion regarding trust expenditures and his deci-
sions cannot be challenged by anyone.3 The trial court
rendered judgment dismissing the plaintiff’s appeal,
concluding that the hearing officer properly determined
that the trust in this case was an available asset and that,
therefore, the plaintiff’s assets disqualified her from
Medicaid eligibility.
The plaintiff appealed from the trial court’s judgment
of dismissal to the Appellate Court. Thereafter, we
transferred the appeal to this court pursuant to General
Statutes § 51-199 (c) and Practice Book § 65-1.
On appeal to this court, the plaintiff claims that the
trial court improperly upheld the hearing officer’s con-
clusion that the trust was an asset available to the
plaintiff as defined by relevant Medicaid regulations.
Specifically, the plaintiff claims that the testator
intended to create a discretionary, supplemental needs
trust, the assets of which should not be considered
available for Medicaid purposes. The department, how-
ever, contends that the testamentary language indicates
that the testator intended the trust to provide for the
plaintiff’s general support, in which case it would con-
stitute an asset available to the plaintiff. We agree with
the plaintiff that the testator intended to create a discre-
tionary, supplemental needs trust and, therefore, we
further agree that the trust corpus and income may not
be considered to be available to the plaintiff for the
purpose of determining eligibility for Medicaid benefits.
We begin by setting forth our applicable standard of
review. Resolution of this issue requires us to determine
whether the hearing officer properly construed the
terms of the trust instrument. ‘‘The construction of a
will presents a question of law . . . . Canaan National
Bank v. Peters, 217 Conn. 330, 335, 586 A.2d 562 (1991).
As we previously have stated . . . [c]onclusions of law
reached by the administrative agency must stand if the
court determines that they resulted from a correct appli-
cation of the law to the facts found and could reasonably
and logically follow from such facts. . . . Board of
Education v. Commission on Human Rights & Oppor-
tunities, 266 Conn. 492, 504, [832 A.2d 660] (2003).’’
(Internal quotation marks omitted.) Corcoran v. Dept. of
Social Services, 271 Conn. 679, 698, 859 A.2d 533 (2004).
Given the nature of the plaintiff’s claim, namely, that
the trial court improperly upheld the hearing officer’s
determination that the trust in the present case was a
general needs trust for the purpose of eligibility for
Medicaid benefits, ‘‘[o]ur analysis begins with an over-
view of the [M]edicaid program. The program, which
was established in 1965 as Title XIX of the Social Secu-
rity Act and is codified at 42 U.S.C. § 1396 et seq. ([M]ed-
icaid act), is a joint federal-state venture providing
financial assistance to persons whose income and
resources are inadequate to meet the costs of, among
other things, medically necessary nursing facility care.
. . . The federal government shares the costs of [M]ed-
icaid with those states that elect to participate in the
program, and, in return, the states are required to com-
ply with requirements imposed by the [M]edicaid act
and by the [S]ecretary of the Department of Health and
Human Services. . . . Specifically, participating states
are required to develop a plan, approved by the [S]ecre-
tary of [H]ealth and [H]uman [S]ervices, containing rea-
sonable standards . . . for determining eligibility for
and the extent of medical assistance to be provided.
. . .
‘‘Connecticut has elected to participate in the [M]ed-
icaid program and has assigned to the department the
task of administering the program. . . . Pursuant to
General Statutes §§ 17b-262 and 17b-10, the department
has developed Connecticut’s state [M]edicaid plan and
has promulgated regulations that govern its administra-
tion. . . .
‘‘The [M]edicaid act requires that a state’s [M]edicaid
plan make medical assistance available to qualified indi-
viduals. 42 U.S.C. § 1396a (a) (10). The term medical
assistance means payment of part or all of the cost of
. . . care and services . . . [including] nursing facility
services . . . . 42 U.S.C. § 1396d (a); see Catanzano
v. Wing, 103 F.3d 223, 229 (2d Cir. 1996). Participating
states are required to provide coverage to certain
groups and are given the option to extend coverage to
various other groups. The line between mandatory and
optional coverage primarily is drawn in 42 U.S.C.
§ 1396a (a) (10) (A): mandatory coverage is specified
in 42 U.S.C. § 1396a (a) (10) (A) (i); and optional cover-
age is set forth in subsection (a) (10) (A) (ii). In [M]edic-
aid parlance, individuals who qualify for [M]edicaid
benefits pursuant to those subsections are referred to
as the categorically needy because, in general, they are
eligible for financial assistance under Titles IV-A (Aid
to Families with Dependent Children) or XVI (Supple-
mental Security Income for the Aged, Blind, and Dis-
abled) of the Social Security Act.
‘‘Under the [M]edicaid act, states have an additional
option of providing medical assistance to the medically
needy—persons who . . . lack the ability to pay for
their medical expenses but do not qualify as categori-
cally needy solely because their income exceeds the
income eligibility requirements of the applicable cate-
gorical assistance program. . . . The medically needy
become eligible for [M]edicaid, if the state elects to
cover them, by incurring medical expenses in an
amount sufficient to reduce their incomes below the
income eligibility level set by the state in its [M]edicaid
plan. See 42 U.S.C. § 1396a (a) (17) (in determining
eligibility, state must take costs . . . incurred for medi-
cal care into account); see also 42 C.F.R. § 435.301.
Only when they spend down the amount by which their
income exceeds that level, are [medically needy per-
sons] in roughly the same position as [categorically
needy] persons . . . [because then] any further expen-
ditures for medical expenses . . . would have to come
from funds required for basic necessities. Atkins v.
Rivera, [477 U.S. 154, 158, 106 S. Ct. 2456, 91 L. Ed.
2d 131 (1986)]. Connecticut has chosen to cover the
medically needy. . . .
‘‘The [M]edicaid act, furthermore, requires participat-
ing states to set reasonable standards for assessing an
individual’s income and resources in determining eligi-
bility for, and the extent of, medical assistance under
the program. 42 U.S.C. § 1396a (a) (17) . . . . The
resources standard set forth in Connecticut’s state
[M]edicaid plan for categorically needy and medically
needy individuals is $1600. General Statutes §§ 17b-264
and 17b-80 (c); [Dept. of Social Services, Uniform Policy
Manual] § 4005.10 . . . . Consequently, a person who
has available resources; see 42 U.S.C. § 1396a (a) (17)
(B); in excess of $1600 is not eligible to receive benefits
under the Connecticut [M]edicaid program even though
the person’s medical expenses cause his or her income
to fall below the income eligibility standard. . . .
Ahern v. Thomas, 248 Conn. 708, 713–16, 733 A.2d 756
(1999).’’ (Citation omitted; internal quotation marks
omitted.) Palomba-Bourke v. Commissioner of Social
Services, 312 Conn. 196, 203–206, 92 A.3d 932 (2014).
This court has stated that, ‘‘[u]nder applicable federal
law, only assets actually available to a medical assis-
tance recipient may be considered by the state in
determining eligibility for public assistance programs
such as [Medicaid]. . . . A state may not, in administer-
ing the eligibility requirements of its public assistance
program . . . presume the availability of assets not
actually available . . . .’’ (Citations omitted; emphasis
omitted.) Zeoli v. Commissioner of Social Services, 179
Conn. 83, 94, 425 A.2d 553 (1979). This principal ‘‘has
served primarily to prevent the [s]tates from conjuring
fictional sources of income and resources by imputing
financial support from persons who have no obligation
to furnish it or by overvaluing assets in a manner that
attributes nonexistent resources to recipients.’’ Heckler
v. Turner, 470 U.S. 184, 200, 105 S. Ct. 1138, 84 L. Ed.
2d 138 (1985).
To resolve the issue on appeal, we must determine
whether the assets in the testamentary trust were avail-
able to the plaintiff. ‘‘For the purposes of determining
eligibility for the Medicaid program, an available asset
is one that is actually available to the applicant or one
that the applicant has the legal right, authority or power
to obtain or to have applied for the applicant’s general
or medical support. If the terms of a trust provide for
the support of an applicant, the refusal of a trustee to
make a distribution from the trust does not render the
trust an unavailable asset.’’ General Statutes (Supp.
2016) § 17b-261 (c).4 For Medicaid purposes, general
support trusts are considered available because a bene-
ficiary can compel distribution of the trust income. See
General Statutes § 52-321. In other words, the benefi-
ciary has a ‘‘legal right . . . to obtain’’ the funds. See
General Statutes (Supp. 2016) § 17b-261 (c). Conversely,
supplemental needs trusts, in which a trustee retains
unfettered discretion to withhold the income, are not
considered available to the beneficiary. Connecticut
Bank & Trust Co. v. Hurlbutt, 157 Conn. 315, 327, 254
A.2d 460 (1968) (spendthrift trust not open to alienation
or assignment by anyone until income paid over to
beneficiary); Bridgeport-City Trust Co. v. Beach, 119
Conn. 131, 141, 174 A. 308 (1934) (beneficiary may not
alienate or assign interest of spendthrift trust).
‘‘It is well settled that in the construction of a testa-
mentary trust, the expressed intent of the testator must
control. This intent is to be determined from reading the
instrument as a whole in the light of the circumstances
surrounding the testator when the instrument was exe-
cuted, including the condition of his estate, his relations
to his family and beneficiaries and their situation and
condition. Gimbel v. Bernard F. & Alva B. Gimbel
Foundation, Inc., 166 Conn. 21, 26, 347 A.2d 81 (1974).
Therefore, in determining whether the assets of a testa-
mentary trust are available to a beneficiary, this court
considers whether the testator intended to create a
supplemental needs trust or a general support trust.
See Zeoli v. Commissioner of Social Services, supra,
179 Conn. 91–92.’’ (Internal quotation marks omitted.)
Corcoran v. Dept. of Social Services, supra, 271
Conn. 700.
‘‘A trust which creates a fund for the benefit of
another, secures it against the beneficiary’s own
improvidence, and places it beyond the reach of his
creditors is a spendthrift trust. Carter v. Brownell, 95
Conn. 216, 223, 111 A. 182 [1920]. Section 52-321 . . .
provides that trust fund income is not subject to the
claims of creditors of the beneficiary if the trustee is
granted the power to accumulate or withhold trust
income or if the income has been expressly given for the
support of the beneficiary or his family. See Cromwell v.
Converse, 108 Conn. 412, 424–25, 143 A. 416 [1928]
. . . .’’ (Citation omitted.) Zeoli v. Commissioner of
Social Services, supra, 179 Conn. 88; see also
Restatement (Third), Trusts § 58 (2003) (‘‘[i]f the terms
of a trust provide that a beneficial interest shall not be
transferable by the beneficiary or subject to claims of
the beneficiary’s creditors, the restraint on voluntary
and involuntary alienation of the interest is valid’’).
Accordingly, to resolve the issue on appeal, we must
determine whether John Pikula intended to create a
supplemental needs trust or a general support trust. In
making this determination, we agree with both parties
and the trial court that prior case law from this court
provides the appropriate framework within which to
examine this issue. Specifically, Zeoli v. Commissioner
of Social Services, supra, 179 Conn. 83, and Corcoran
v. Dept. of Social Services, supra, 271 Conn. 679, guide
our analysis of this issue.
First, in Zeoli v. Commissioner of Social Services,
supra, 179 Conn. 84–88, this court concluded that the
testator intended to create a supplemental needs trust
for the plaintiffs, his two disabled daughters.5 In doing
so, this court recognized that ‘‘[t]o determine the discre-
tionary powers provided, it is necessary to ascertain
the dispositive intention as expressed by the language
of the entire will in the light of the circumstances sur-
rounding the testator when the instrument was exe-
cuted, including the condition of his estate, his relations
to his family and beneficiaries and their situation and
condition.’’ (Internal quotation marks omitted.) Id., 89;
see also Rosa v. Palmer, 177 Conn. 10, 13, 411 A.2d
12 (1978); Gimbel v. Bernard F. & Alva B. Gimbel
Foundation, Inc., supra, 166 Conn. 26; Colonial Bank &
Trust Co. v. Stevens, 164 Conn. 31, 37, 316 A.2d 768
(1972); Connecticut Bank & Trust Co. v. Lyman, 148
Conn. 273, 279, 170 A.2d 130 (1961). On the basis of
these principles, this court concluded that ‘‘the testa-
tor’s intent was to provide the trustee with sufficient
flexibility to use the funds under the trust solely for
supplemental support. Both the surrounding circum-
stances and the language of the will militate in favor
of this interpretation. The trust established by [the testa-
tor’s] will clearly recognizes the obvious incapacity of
his daughters to care for themselves. As the amount
held under trust, approximately one-half of his entire
estate, indicates, the [testator] was a person of modest
means. Presumably, the funds under the trust would
not provide for general support of his daughters in an
institution for much more than a few months. Moreover,
at the time of the will’s execution and at the time of
the testator’s death, the daughters were not receiving
medical assistance payments and the testator could not
know if and how soon such benefits would become
available.’’ (Footnotes omitted.) Zeoli v. Commissioner
of Social Services, supra, 90.
This court further explained that ‘‘[t]he trust grants
the trustee in express terms the power both to discrimi-
nate totally against either of the beneficiaries by with-
holding all income and to disregard funds that might
be available to either of the beneficiaries. On the other
hand, in precatory language, the trust provides that the
trustee apply ‘the net income or principal of the trust
for the maintenance, support, education, health and
general welfare of those of my daughters who my
[t]rustee believes would benefit most from a share of
the income of this trust after considering the income
of the beneficiaries from other sources.’
‘‘In granting the trustee the ability to discriminate
against either of the beneficiaries as well as to consider
other sources of funds available to the beneficiaries,
the testator reveals an intent to provide for only the
supplementary support of his daughters. The combina-
tion of express and precatory terms in the will attempts
to grant the trustee flexibility to provide the support
that would benefit either of the beneficiaries the most,
that is, imposing on the trustee the legal duty to furnish
only supplementary support. If the testator had desired
to create a trust for general support, it would have been
simple to do so and no discriminatory provision would
have been necessary or desirable.’’ (Footnote omitted.)
Id., 90–91. On the basis of the terms of the trust, this
court concluded that the testator had intended to create
a supplemental needs trust and that those assets were
not available to the daughters for the purpose of
determining their eligibility for Medicaid benefits. Id.,
97.
In 2004, this court again confronted whether a trust
was available for the purpose of Medicaid eligibility in
Corcoran v. Dept. of Social Services, supra, 271 Conn.
679. In Corcoran, this court acknowledged that the tes-
tamentary language reflective of the testator’s intent in
Corcoran was markedly different than that used in
Zeoli. Id., 701. Specifically, this court explained that
‘‘[i]n Zeoli, the trust instrument was replete with refer-
ences to the ‘absolute and uncontrolled discretion’
afforded the [trustee] in [his] decision-making process.
. . . In addition to the overt references to the unfet-
tered discretion of the [trustee], the court in Zeoli
deemed the provision authorizing the trustee to discrim-
inate among the beneficiaries when making distribu-
tions highly probative of the vast level of discretion the
testator intended to confer on the trustee.’’ (Citation
omitted.) Id. This court then compared the testamentary
language in Corcoran, explaining that ‘‘the testator
granted the trustees ‘sole discretion’ to make distribu-
tions and provided them with factors to consider when
making ‘discretionary distributions . . . .’ This lan-
guage is not as strong as that used in Zeoli and suggests
that the testator in the present case intended to confer
a lesser amount of discretion.’’ (Footnote omitted.)
Id., 701–702.
This court further reasoned as follows: ‘‘The principal
distinction between Zeoli and [Corcoran], however, is
the manner in which the respective testators expressed
their intentions regarding the use of the trust funds. In
Zeoli, after establishing the trust, the testator provided
in his will that it [was his] fond hope that [his] trustee
pay or apply the net income or principal of the trust
for the maintenance, support, education, health and
general welfare of [the beneficiaries] . . . . [In Zeoli,
the] court interpreted this to mean that [t]he combina-
tion of express and precatory terms in the will attempts
to grant the trustee flexibility to provide the support
that would benefit either of the [daughters] the most,
that is, imposing on the trustee the legal duty to furnish
only supplementary support.’’ (Citation omitted;
emphasis omitted; internal quotation marks omitted.)
Id., 702. This court, however, found the testamentary
language in Corcoran to be distinguishable from that
in Zeoli. Id. In Corcoran, the testator created the trust
with the following language: ‘‘If [the plaintiff] is then
living, the trust established for her shall be retained by
my trustees to hold, manage, invest and reinvest said
share as a [t]rust [f]und, paying to or expending for the
benefit of [the plaintiff] so much of the net income and
principal of said [t]rust as the [t]rustees, in their sole
discretion, shall deem proper for her health, support in
reasonable comfort, best interests and welfare . . . .’’
(Emphasis omitted; internal quotation marks omitted.)
Id., 703. This court relied on the fact that the trustees
did not have absolute discretion, instead their sole dis-
cretion was ‘‘limited by the ascertainable standard of
the plaintiff’s ‘health, support in reasonable comfort,
best interests and welfare . . . .’ ’’ Id. On the basis of
these distinctions, this court concluded that the testa-
mentary trust in Corcoran did not display the testamen-
tary intent to provide only for the plaintiff’s
supplemental needs and, therefore, was a general needs
trust available to the plaintiff. Id.
These cases provide a framework for considering the
language of the trust in the present case. Specifically, in
Zeoli and Corcoran, this court identified and examined
several factors that are useful in determining whether a
particular testamentary trust is intended to be a general
needs trust or a supplemental needs trust—namely, the
amount and nature of the trustee’s discretion with
regards to trust income and principal, any limitations
or guiding principles within which the trustee must
operate, and the factual circumstances regarding the
establishment of the trust, including the amount of
the trust.
With these factors in mind, we examine the language
of the testamentary trust in the present case. The rele-
vant portions of the testamentary trust in the present
case provides as follows: ‘‘I give, devise and bequeath
all of the rest, residue and remainder of my estate, real,
personal and mixed, of whatever nature and whereso-
ever situated, including all property that I may acquire
or become entitled to after the execution of this will
to [the trustee] in trust, nevertheless . . . for the bene-
fit of . . . [the plaintiff] . . . and [McKee] . . . . Said
[t]rustee shall hold, manage and control all of the afore-
said property as a trust estate with all of the rights and
powers subject to limitations herein enumerated for
the following uses and purposes:
‘‘A. Until [the plaintiff] shall die, the [t]rustee shall
pay to or spend on behalf of [the plaintiff] as much
of the net income derived from this trust fund as the
[t]rustee may deem advisable to provide properly for
[her] maintenance and support and may incorporate
any income not so distributed into the principal of the
fund at the option of the [t]rustee.
‘‘B. I hereby authorize and empower the [t]rustee in
his sole and absolute discretion at any time and from
time to time to disburse from the principal for any of
the trust estates created under this [will], even to the
point of completely exhausting the same, such amount
as he may deem advisable to provide adequately and
properly for the support and maintenance of the current
income beneficiaries thereof, any expenses incurred
by reason of illness and disability. In determining the
amount of principal to be so disbursed, the [t]rustee
shall take into consideration any other income or prop-
erty which such income beneficiary may have from
any other source, and the [t]rustee’s discretion shall be
conclusive as to the advisability of any such disburse-
ment and the same shall not be questioned by anyone.
For all sums so distributed, the [t]rustee shall have
full acquittance.’’
First, the language set forth previously in this opinion
indicates that the trustee in the present case need only
use as much income from the trust ‘‘as the [t]rustee
may deem advisable’’ to the plaintiff. The testamentary
language further provides that any unused income may
be returned to the trust principal. Although the language
in the present case indicates that the trustee may use
the net income for the maintenance and support of the
plaintiff, the fact that the trustee is only required to use
as much income as he ‘‘may deem advisable’’ to provide
for such maintenance, indicates that the testator
intended for the trustee to have complete discretion in
determining what, if any, of the income was to be used
for the plaintiff’s maintenance. Furthermore, the fact
that the trust provides that any unused income may be
returned to the principal of the trust indicates that the
testator did not intend to provide for the general needs
of the plaintiff. The trust was only valued at approxi-
mately $169,745, therefore, it is unlikely that the income
of the trust would have been significant enough to pro-
vide for the plaintiff’s maintenance at the time the testa-
tor executed his will in 1989 or when the trust was
established in 1991.
Furthermore, the testamentary language in the pres-
ent case provides that the trustee has ‘‘sole and absolute
discretion’’ to make disbursements from the principal
of the trust. The trust further provides that the trustee’s
discretion ‘‘shall be conclusive as to the advisability
of any such disbursement and the same shall not be
questioned by anyone.’’ Furthermore, the trust provides
a release from liability for the trustee regarding any
distributions of principal. On the basis of the foregoing,
it is clear that no person can compel the trustee to
disburse any principal to the plaintiff. We conclude that
the language regarding the discretion of the trustee in
the present case is analogous to the language providing
absolute and sole discretion to the trustee in Zeoli.
Next, we examine whether the trust in the present
case contains any limitations or guiding principles
within which the trustee must operate. In the present
case, the trust mentions ‘‘support’’ and ‘‘maintenance’’
in both the section providing for expenditure of the
income and the section addressing disbursement of
principal. Nevertheless, in each of these sections the
‘‘support’’ and ‘‘maintenance’’ language is followed or
preceded by language allowing the trustee broad discre-
tion to do so only if he deems it advisable. Unlike the
language of the trust in Corcoran, nothing in the present
trust mentions a standard by which the trustee shall
make the expenditures or distribution. In Corcoran,
this court relied on language that the trustees shall
‘‘hold, manage, invest and reinvest said share as a [t]rust
[f]und, paying to or expending for the benefit of [the
plaintiff] so much of the net income and principal of
said [t]rust as the [t]rustees, in their sole discretion,
shall deem proper for her health, support in reasonable
comfort, best interests and welfare . . . .’’ (Emphasis
omitted; internal quotation marks omitted.) Corcoran
v. Dept. of Social Services, supra, 271 Conn. 703. This
court reasoned that the language of the trust in Corco-
ran acted as a limitation on the discretion of the trustees
because it provided a standard within which the trust-
ees must operate in making expenditures. Id.
On the other hand, the language of the trust in Zeoli,
provided that ‘‘[w]ithout in any way limiting the abso-
lute discretion of my [t]rustee, it is my fond hope that
my trustee pay or apply the net income or principal of
the trust for the maintenance, support, education,
health and general welfare of those of my daughters
who my [t]rustee believes would benefit most from a
share of the income of this trust after considering the
income of the beneficiaries from other sources.’’ (Inter-
nal quotation marks omitted.) Zeoli v. Commissioner
of Social Services, supra, 179 Conn. 87 n.2. This court
concluded in Zeoli that ‘‘[t]he combination of express
and precatory terms in the will attempts to grant the
trustee flexibility to provide the support that would
benefit either of the beneficiaries the most, that is,
imposing on the trustee the legal duty to furnish only
supplementary support.’’ Id., 91. We conclude that the
language in the present case is more similar to that
language in Zeoli and provides that the trustee is
required to provide only supplemental support.
We next consider the factual circumstances regarding
the establishment of the trust, including the amount of
the trust. In Zeoli, this court considered the fact that
the testator’s estate was a modest $9500 in 1975. Id.,
85. This court reasoned that, because the beneficiary
had a mental impairment that required institutionaliza-
tion, the modest trust assets would be exhausted
quickly if it was treated as a general needs trust. Id., 90.
This court reasoned that these factual circumstances
weighed in favor of understanding that the testator did
not intend for the trust to be a general support trust.
Id. In Corcoran, however, this court concluded that the
testator intended to create a general support trust with
a significantly larger estate—approximately $854,307.
Corcoran v. Dept. of Social Services, supra, 271
Conn. 682.
In the present case, the testator had a relatively small
estate. Indeed, the trust assets in the present case con-
sisted mainly of the plaintiff’s primary residence, the
testator’s home. In March, 2012, after the home was
sold, the trust assets totaled $169,745.91. Much like the
situation in Zeoli, the assets of the present trust would
be quickly exhausted if they were applied to the
expenses related to the plaintiff’s impairment for which
she has sought residential placement. Accordingly, we
conclude that the factual circumstances surrounding
the establishment of the trust in the present case further
bolster our conclusion that it is a supplemental
needs trust.
On the basis of the foregoing, we conclude that the
trial court improperly dismissed the plaintiff’s appeal
from the decision of the hearing officer determining
that the trust in the present case is a general support
trust and that, therefore, the assets are available to
the plaintiff. Instead, we conclude that the trust in the
present case is a supplemental needs trust and that,
therefore, the assets are not available to the plaintiff
for the purpose of determining eligibility for Medic-
aid benefits.
The judgment is reversed and the case is remanded
to the trial court with direction to render judgment
sustaining the plaintiff’s appeal.
In this opinion the other justices concurred.
1
We note that the Commissioner of Social Services acts on behalf of the
department. For the sake of simplicity, references in this opinion to the
department include the Commissioner of Social Services.
2
‘‘Medicaid is a federal program that provides health care funding for
needy persons through cost-sharing with states electing to participate in
the program.’’ (Internal quotation marks omitted.) Corcoran v. Dept. of
Social Services, 271 Conn. 679, 683 n.4, 859 A.2d 533 (2004).
3
In her complaint, the plaintiff also alleged that the hearing officer was
barred by the doctrine of collateral estoppel from determining that the trust
was a ‘‘general support trust’’ or that the assets were ‘‘available’’ to the
plaintiff because the Probate Court had previously decided that the trust
was a supplemental needs trust and that the plaintiff could not force the
trustee to make any distributions. The trial court determined that the doc-
trine of collateral estoppel did not bar the hearing officer from determining
that the trust was a general needs trust for the purpose of determining the
plaintiff’s eligibility for Medicaid benefits. On appeal, the plaintiff asserts
that the trial court improperly determined that the hearing officer was not
collaterally estopped from determining that the trust was a general needs
trust. Because we conclude that the trial court improperly upheld the hearing
officer’s conclusion that the trust was a general needs trust and available
to the plaintiff, we need not reach the issue of collateral estoppel.
4
We note that § 17b-261 has been amended by our legislature since the
events underlying the present appeal. See, e.g., Public Acts 2015, No. 15-69,
§ 17. These amendments are not, however, relevant to the present appeal.
For the sake of simplicity, all references to § 17b-261 in this opinion are to
the version appearing in the 2016 supplement to the General Statutes.
5
The language of the trust in Zeoli provided as follows: ‘‘All of the rest,
residue and remainder of my property and estate, real, person or mixed, of
whatsoever the same may consist and wheresoever the same may be situated,
all of which is hereinafter referred to as my residuary estate, shall be disposed
of as follows:
‘‘(a) I give, devise and bequeath one-half . . . of my residuary estate unto
my son . . . to be his absolutely and forever;
‘‘(b) I give, devise and bequeath one-half . . . of my residuary estate to
my [t]rustee hereinafter named in trust [nevertheless], to hold in a single
trust for and until the death of the survivor of my daughters, to invest and
reinvest the principal of such trust and to dispose of the net income and
principal thereof as follows:
‘‘To pay or apply so much of the net income or the principal of such trust
to or among either one or both of my daughters as shall be living from time
to time during the term of such trust, and in such proportions and amounts
as my [t]rustee shall determine in his absolute and uncontrolled discretion.
Such amounts of net income or principal may be paid or applied without
regard to equality of distribution and regardless of whether any one of my
daughters may be totally deprived of any benefit hereunder. My [t]rustee,
in exercising his absolute and uncontrolled discretion, shall not be required
to consider the amount of income from other sources of any beneficiary or
the amount of any beneficiary’s independent property or the extent to which
any beneficiary may be entitled to support by a parent or any other person.
The judgment of my [t]rustee as to the allocation of the net income or
principal of this trust among the beneficiaries shall be final and conclusive
upon all interested persons and upon making such payments or application
my [t]rustee shall be fully released and discharged from all further liability
or accountability therefor. My trustee shall not be required to distribute any
net income of such trust currently and may, in his absolute and uncontrolled
discretion, accumulate any part or all of the net income of such trust,
which such accumulated net income shall be available for distribution to
the beneficiaries as aforesaid.
‘‘Without in any way limiting the absolute discretion of my [t]rustee, it is
my fond hope that my trustee pay or apply the net income or principal of
the trust for the maintenance, support, education, health and general welfare
of those of my daughters who my [t]rustee believes would benefit most
from a share of the income of this trust after considering the income of the
beneficiaries from other sources.’’ (Internal quotation marks omitted.) Zeoli
v. Commissioner of Social Services, supra, 179 Conn. 86–87 n.2.