Cordero v. Univ. of Conn. Hlth. Ctr.

Full title: NILSA CORDERO v. UNIVERSITY OF CONNECTICUT HEALTH CENTER ET AL

Court: Connecticut Superior Court Judicial District of Hartford at Hartford

Date published: Apr 6, 2011

2011 Ct. Sup. 8743 (Conn. Super. Ct. 2011)

51 CLR 694

Opinion

No. CV 09-5030511-S

April 6, 2011

MEMORANDUM OF DECISION ON DEFENDANT'S SETOFF FOR DAS LIEN

R. SATTER, JTR.

At the trial, this court bifurcated the state's claim for a setoff of its Department of Administrative Services (DAS) lien for State Administered General Assistance (SAGA) payments made to the plaintiff, and agreed to determine that issue after trial. On February 24, 2011, this court rendered its decision in favor of plaintiff and awarded her damages of $235,070.83. Now comes the state and asserts its right to a setoff against that amount, less certain agreed upon deductions, for its SAGA payments of $70,682.33. The parties have agreed that the following deductions may be made to the damages awarded to arrive at the amount subject to the state's setoff.

($ 2,408.41

Judgment amount $235,070.83 Less: attorneys fees ($ 78,356.94) costs trial expenses ($ 5,739.93) workers' comp lien ($ 69,668.82) State of Connecticut medical related expense ) Subtotal ($156,174.10) BALANCE $ 78,896.73

The parties further agree that the state's DAS lien is $70,682.33.

The state claims it is entitled to the full $70,682.33, leaving the plaintiff $8,214.40. The plaintiff claims that, pursuant to Conn. Gen. Stat. § 17b-94(a), the state is entitled to one-half of $78,896.70 or $39,448.37.

The state bases its claim on the general right of setoff a defendant has against any amount a plaintiff may recover.

A setoff arises where the defendant has a debt against the plaintiff and desires to avail himself of that debt in the existing suit, either to reduce the plaintiff's recovery or defeat it altogether. Hope's Architectural Products, Inc. v. Fox Steel, Co., 44 Conn.App. 759, 762 (1997), cert. denied 241 Conn. 915; Avery v. Brown, 31 Conn. 398, 401 (1863). It is a debt which "arises [not] out of the same transaction described in the complaint . . . [but which] is independent thereof." Savings Bank of New London v. Santaniello, 130 Conn. 206, 210 (1943).

The authority by which a defendant in a civil action may assert a set off as part of its defense is stated in Connecticut Practice Book § 10-54, to wit:

In any case in which the defendant has either in law or in equity or in both a counterclaim, or right of setoff against the plaintiff's demand, the defendant may have the benefit of any such setoff or counterclaim by pleading the same as such in the answer, and demanding judgment accordingly; and the same shall be pleaded and replied to according to the rules governing complaints and answers. (Emphasis added.)

Plaintiff, on the other hand, relies upon Sections 17b-93(a) and 17b-94(a), which specifically relate to a state's right of setoff against a plaintiff who recovers in a cause of action when he has been the beneficiary of state administered general assistance payments. Section 17b-93(a) provides that if a beneficiary of aid under a state administered general assistance program has acquired property of any kind or interest, the state shall have a lien for those payments, "subject to the provisions of Section 17b-94."¹

1 Sec. 17b-93. (Formerly Sec. 17-83e.) Claim of state for repayment of aid. Exceptions. Regulations.

(a) If a beneficiary of aid under the state supplement program, medical assistance program, aid to families with dependent children program, temporary family assistance program or state-administered general assistance program has or acquires property of any kind or interest in any property, estate or claim of any kind, except moneys received for the replacement of real or personal property, the state of Connecticut shall have a claim subject to subsections (b) and (c) of this section, which shall have priority over all other unsecured claims and unrecorded encumbrances, against such beneficiary for the full amount paid, subject to the provisions of section 17b-94, to him or in his behalf under said programs.

Section 17b-94(a)² provides that when a beneficiary of state administered general assistance program brings a cause of action "the claim of the state shall be a lien against the proceeds therefrom in the amount of the assistance paid or fifty percent of the proceeds received by such beneficiary . . . after payment of expenses connected with the cause of action, whichever is less." That section further provides that the state's lien shall have priority over all other claims except attorneys fees, expenses of suit, and medical expenses connected with the cause of action.

2 Sec. 17b-94. (Formerly Sec. 17-83f.) State's claim against proceeds of cause of action. Assignment of interest in estate to the state.

(a) In the case of causes of action of beneficiaries of aid under the state supplement program, medical assistance program, aid to families with dependent children program, temporary family assistance program or state-administered general assistance program, subject to subsections (b) and (c) of section 17b-93, or of a parent of a beneficiary of the aid to families with dependent children program, the temporary family assistance program or the state-administered general assistance program, the claim of the state shall be a lien against the proceeds therefrom in the amount of the assistance paid or fifty percent of the proceeds received by such beneficiary or such parent after payment of all expenses connected with the cause of action, whichever is less, for repayment under said section 17b-93, and shall have priority over all other claims except attorneys fees for said causes, expenses of suit, costs of hospitalization connected with the cause of action by whomever paid over and above hospital insurance or other such benefits, and, for such period of hospitalization as was not paid for by the state, physicians' fees for services during any such period as are connected with the cause of action over and above medical insurance or other such benefits; and such claim shall consist of the total assistance repayment for which claim may be made under said programs. (Added emphasis.)

The state argues that the provision in § 17b-94(a) that it is entitled to a setoff for its full lien or fifty percent of the net amount of the recovery, whichever is less, may be applicable when the plaintiff-beneficiary of SAGA sues a third party as tortfeasor, but not when he sues the state as tortfeasor. In support of this assertion the state relies upon McCoy v. State of Connecticut, Superior Court, judicial district of New London, docket no. CV 121494 (November 13, 2001, Hurley, JTR) ( 30 Conn. L. Rptr. 683). In that case the plaintiff brought an action to seek damages for injuries sustained while he was a resident at Norwich State Hospital. The state asserted a setoff for the plaintiff's medical costs of care at the Norwich Hospital. The court allowed the state its full setoff holding, stating, "Under CGS § 17b-224, ³ the state is entitled to full reimbursement for the cost of care provided to a patient of a state humane institution." The court added as dicta:

3 Sec. 17b-224. A patient who is receiving or has received care in a state humane institution, . . . shall be liable to reimburse the state for any unpaid portion of per capita costs to the same extent as the liability of a public assistance beneficiary under Section 17b-93 and 17b-95, subject to the same protection of a surviving spouse or dependent child as therein provided.

Ordinarily § 17b-94 limits the amount of the state's recovery against the plaintiff to the full amount of assistance paid or fifty percent of the proceeds from a judgment after payment of attorneys fees and costs, whichever is less. However, in this case, plaintiffs did not bring an action against a third party and recover damages but rather brought this action against the state which is the alleged tortfeasor. In this case, the state has the statutory right to claim a full setoff for the full amount of assistance paid in accordance with § 17b-224 and 17b-93."

McCoy is distinguishable from the present case in that it concerns recovery by the state pursuant to § 17b-224 which provides that the state is entitled to the full amount paid for medical care provided to patients at state humane institutions. The public assistance at issue in the present case is not medical care; it is state administered general assistance. Further, the McCoy court's holding that "the state has a statutory right to claim a full setoff for the full amount of assistance paid in accordance with §§ 17b-224 and 17b-93" is not a holding on its interpretation of § 17b-94. Moreover, the distinction the McCoy court makes between the applicability of § 17b-94 on whether the plaintiff, having received general public assistance, brings an action against a third party or against the state, has no basis in the wording of § 17b-94. That statute is completely silent on against whom the plaintiff brings his cause of action.

It is axiomatic that a statute is to be interpreted "by analysis of the language actually used in the legislation . . . [W]hen the language of a statute is plain and unambiguous, we need look no further than the words themselves because we assume that the language expresses the legislative intent." Commissioner of Administrative Services v. Gerace, 40 Conn.App. 829, 832 (1996), appeal dismissed, 239 Conn. 791 (1997).

In State v. Marks, 239 Conn. 471, 476 (1996), the Supreme Court observed that "§§ 17b-93, 17b-94 and 17b-95 must be read together because they set out a general statutory scheme for reimbursement to the state for public assistance payments that the state made to or for the benefit of public assistance beneficiaries. Section 17b-93 provides the general rule for reimbursement. Under that provision, subject to certain exceptions stated therein, if a public assistance beneficiary `has or acquires property of any kind or interest in any property, estate or claim of any kind, the state shall have a claim . . . against such beneficiary for the full amount paid . . .'"

Section 17b-93 however, is "subject to the provisions of § 17b-94."

Section 17b-94 provides an exception to the general rule of full reimbursement to the state. It allows the state to exercise a lien on proceeds from successful actions brought by public assistance beneficiaries and provides that "the claim of the state shall be a lien against the proceeds therefrom in the amount of assistance paid or fifty percent of the proceeds received by such beneficiary . . . after payment of all expenses connected with the cause of action, whichever is less."

As the court noted in State v. Marks, supra, 479: "The obvious purpose of reducing the amount of the state's lien on such proceeds and, thereby, affording some of the recovery to the public assistance beneficiary, was to give an incentive to the beneficiary to prosecute his or her cause of action, thus benefitting the beneficiary and, possibly the state as well, as described previously." Section 17b-94 serves to encourage public assistance beneficiaries to prosecute a cause of action against a third party by insuring they might be entitled to some recovery despite a setoff by the state. The state in turn benefits by recovering monies that would not be available had the beneficiary chosen to abandon his cause of action when the state would be entitled to recover the total amount of any judgment awarded.

Based on the foregoing, the court concludes the state is entitled to one-half of $78,896.73, representing the net amount of the judgment after proper deductions, or the sum of $39,448.30. The plaintiff is entitled to the other half, or the sum of $39,448.37.