Guytri Sookhoo v. Roderick Bremby (2014)

MEMORANDUM OF DECISION

This is an administrative appeal brought by the plaintiff, Guytri Sookhoo, challenging a decision by a Department of Social Services (DSS) Hearing Officer that the plaintiff is obligated to repay improperly awarded child-care assistance benefits after the plaintiff failed to notify the agency regarding a change in her employment status.   For the reasons set forth below, the decision of the agency must be affirmed.

FACTS AND PROCEDURAL HISTORY

The record reveals the following relevant facts and procedural history.   The plaintiff enrolled her four-year-old daughter at Catholic Charities Child Development Center (Catholic Charities) in Waterbury in order to receive child care services.   Catholic Charities requires that parents who enroll their children in its child care program apply for financial assistance through Care 4 Kids, a subsidy program administered by DSS that provides affordable child care for low to moderate income families.

The plaintiff applied for benefits from Care 4 Kids by completing and signing a child care assistance packet, which was dated August 9, 2010.   The plaintiff's application for Care 4 Kids benefits indicated that she had read her rights and responsibilities or had them read to her in a language she understood.   The plaintiff represented in the application that she was employed by Macy's.   The plaintiff confirmed on her completed application that she understood and agreed that she must report changes in her employment status to Care 4 Kids within ten days of the change, including changes to her income and hours of employment.¹  The application also indicated that the plaintiff understood and agreed that she may be required to repay benefits that were paid in error on her behalf, including administrative errors.

Care 4 Kids sent several notices to the plaintiff regarding her child care benefits.   The plaintiff threw away all mail from Care 4 Kids without reading it because she considered it to be “junk mail.”   In February 2011, the plaintiff lost her job at Macy's.   The plaintiff reported her job loss to Catholic Charities.   The plaintiff, however, did not report the change in her employment to Care 4 Kids within ten days.

Care 4 Kids paid $2,001.35 to Catholic Charities for the child care services it provided to the plaintiff from March 1, 2011, to July 29, 2011.   On July 19, 2011, Care 4 Kids mailed a notice to the plaintiff cancelling her child care assistance benefits, effective July 29, 2011.   Care 4 Kids cancelled the assistance because the plaintiff, who had been eligible for benefits because she was employed, had lost her job.   After she lost her job, the plaintiff was no longer participating in an approved employment, training, or self-employment activity required by Care 4 Kids in order to receive benefits.²

On March 21, 2012, Care 4 Kids sent the plaintiff a notice that it had overpaid Catholic Charities $2,001.35 for the period of March 1, 2011, through July 29, 2011, and that it was seeking repayment of those benefits from the plaintiff.   At the plaintiff's request, the DSS held an administrative hearing on September 25, 2012.   Following the hearing, the Hearing Officer upheld the agency's decision ordering repayment because the plaintiff was not engaged in an approved activity such as employment while receiving child care assistance benefits from Care 4 Kids from February 2011, through July 2011.   The Hearing Officer also found that the plaintiff failed to timely report her separation from employment, and thus improperly continued to receive financial assistance for which she was not eligible.   Finally, the Hearing Officer found that the plaintiff's equitable estoppel claim was inapplicable against Care 4 Kids. The plaintiff, who is aggrieved by the agency's decision timely filed this administrative appeal pursuant to General Statutes § 4–183.   Further facts are set forth below as necessary.

ANALYSIS

The plaintiff claims that the Hearing Officer's determinations must be set aside because:  (1) the plaintiff's “detrimental reliance” on Catholic Charities caused the overpayment;  (2) Catholic Charities was the “apparent agent” of DSS and Care 4 Kids;  and (3) DSS and Care 4 Kids would be “unjustly enriched” if they recovered child care benefits from the plaintiff, instead of Catholic Charities.

This court reviews the plaintiff's appeal under the Uniform Administrative Procedure Act (UAPA), General Statutes § 4–166 et seq.  “Judicial review of an administrative agency decision requires a court to determine whether there is substantial evidence in the administrative record to support the agency's findings of basic fact and whether the conclusions drawn from those facts are reasonable ․ Neither [our Supreme Court] nor the trial court may retry the case or substitute its own judgment for that of the administrative agency on the weight of the evidence or questions of fact ․ Our ultimate duty is to determine, in view of all of the evidence, whether the agency, in issuing its order, acted unreasonably, arbitrarily, illegally or in abuse of its discretion.”  (Citations omitted;  internal quotation marks omitted.)   Cadlerock Properties Joint Venture, L.P. v. Commissioner of Environmental Protection, 253 Conn. 661, 676, 757 A.2d 1 (2000).

“The substantial evidence rule governs judicial review of administrative fact-finding under [the Uniform Administrative Procedure Act (UAPA) ]. General Statutes § 4–183(j)(5) and (6).   Substantial evidence exists if the administrative record affords a substantial basis of fact from which the fact in issue can be reasonably inferred ․ This substantial evidence standard is highly deferential and permits less judicial scrutiny than a clearly erroneous or weight of the evidence standard of review ․ The reviewing court must take into account [that there is] contradictory evidence in the record ․ but the possibility of drawing two inconsistent conclusions from the evidence does not prevent an administrative agency's finding from being supported by substantial evidence ․ The burden is on the [plaintiffs] to demonstrate that the [agency's] factual conclusions were not supported by the weight of substantial evidence on the whole record.”  (Internal quotation marks omitted.)  Sams v. Dept. of Environmental Protection, 308 Conn. 359, 374, 63 A.3d 953 (2013).

A. Equitable Estoppel

The plaintiff first contends that her “detrimental reliance on [Catholic Charities] to provide her the correct information caused plaintiff to incur an overpayment to an entity she did not know existed.”   The Hearing Officer found that the plaintiff's estoppel argument did not apply because the plaintiff voluntarily chose a child care provider that required her to apply for child care assistance, signed the forms applying for that assistance, and agreed to comply with Care 4 Kids' requirements such as timely reporting changes in her employment status.³  The Hearing Officer further found that the plaintiff was not misinformed about the Care 4 Kids program.

“There are two essential elements to an estoppel—the party must do or say something that is intended or calculated to induce another to believe in the existence of certain facts and to act upon that belief;  and the other party, influenced thereby, must actually change his position or do some act to his injury which he otherwise would not have done.”  (Internal quotation marks omitted.)  Russo v. Waterbury, 304 Conn. 710, 735, 41 A.3d 1033 (2012).  “In addition, estoppel against a public agency is limited and may be invoked:  (1) only with great caution;  (2) only when the action in question has been induced by an agent having authority in such matters;  and (3) only when special circumstances make it highly inequitable or oppressive not to estop the agency ․ [T]his exception applies where the party claiming estoppel would be subjected to substantial loss if the public agency were permitted to negate the acts of its agents.”  (Internal quotation marks omitted.)  Fadner v. Commissioner of Revenue Services, 281 Conn. 719, 726, 917 A.2d 540 (2007).  “A party seeking to justify the application of the estoppel doctrine by establishing that a public agency has induced his actions carries a significant burden of proof.”  Id., 727.

In the present case, the defendant's equitable estoppel claim is based wholly upon the conduct of Catholic Charities, and not DSS. Indeed, there is no dispute that it was Catholic Charities, and not DSS, that required the plaintiff to apply for benefits through Care 4 Kids.⁴ The plaintiff indicated on her application for Care 4 Kids benefits that she understood the requirements of the program, including that she was required to report any change in her hours of employment to Care 4 Kids within ten days and that she may be required to repay any benefits received in error, including administrative errors.⁵  R. 27;  R. 31.

There is nothing in the record indicating that DSS or Care 4 Kids did or said anything intended or calculated to improperly induce the plaintiff to enroll in the program.   Indeed, the plaintiff claims that it was Catholic Charities, not DSS or Care 4 Kids, who required the plaintiff and others enrolling in its child care program to apply for Care 4 Kids benefits.

The plaintiff also alleges that Catholic Charities' continued billing of Care 4 Kids caused the overcharges to occur.   The plaintiff does not claim that DSS or Care 4 Kids knew that she lost her job until July 2011.   Catholic Charities' purported conduct has no relevance to that of DSS or Care 4 Kids.⁶ The plaintiff's assertion that DSS allowed Catholic Charities to distribute benefit application forms to those seeking to enroll in its child care program is insufficient to meet her high burden of proof to apply equitable estoppel against a state agency.⁷  The court, therefore, finds that substantial evidence in the administrative record supports the Hearing Officer's conclusion that equitable estoppel does not apply against DSS in the present case.

B. Apparent Agency

The court now turns to the plaintiff's argument that Catholic Charities acted as an “apparent agent” of DSS. The plaintiff claims that DSS's acts and omissions caused her to believe that Catholic Charities was DSS's apparent agent.   The plaintiff thus contends that reporting of her job loss to Catholic Charities was proper notice to DSS and, therefore, equitable estoppel applies against the agency.   DSS argues that the plaintiff failed to bring the apparent agency argument at the administrative hearing and is consequently barred from raising it in this appeal.   DSS further contends that, even if the plaintiff had raised the apparent agency issue during the administrative hearing, the record does not support the plaintiff's argument.

“Apparent authority is that semblance of authority which a principal, through his own acts or inadvertences, causes or allows third persons to believe his agent possesses ․ Consequently, apparent authority is to be determined, not by the agent's own acts, but by the acts of the agent's principal ․ The issue of apparent authority is one of fact to be determined based on two criteria ․ First, it must appear from the principal's conduct that the principal held the agent out as possessing sufficient authority to embrace the act in question, or knowingly permitted [the agent] to act as having such authority ․ Second, the party dealing with the agent must have, acting in good faith, reasonably believed, under all the circumstances, that the agent had the necessary authority to bind the principal to the agent's action.”  (Internal quotation marks omitted.)  Coppola Construction Co. v. Hoffman Enterprises, Ltd., 309 Conn. 342, 353, 71 A.3d 480 (2013).

The record reveals that the plaintiff did not raise the issue that Catholic Charities was the “apparent agent” of DSS at the public hearing or in any materials submitted after the hearing to the Hearing Officer.   The DSS Hearing Officer, therefore, never had the opportunity to consider the plaintiff's apparent agency argument.   Consequently, this court “will not set aside an agency's determination upon a ground not theretofore fairly presented to its consideration because such action on [the court's] part would deprive the agency of an opportunity to consider the matter, make its ruling, and set forth the reasons for its action.”  Finkenstein v. Administrator, Unemployment Compensation Act, 192 Conn. 104, 114, 470 A.2d 1196 (1984).   See also Upjohn Co. v. Planning & Zoning Commissioner, 224 Conn. 82, 89, 616 A.2d 786 (1992) (refusing to consider a claim on appeal that was not presented to agency for consideration).

Additionally, even if this court did consider the plaintiff's argument that Catholic Charities acted as the apparent agent of DSS in this appeal, the plaintiff still could not prevail on this claim.   This court will not “retry the case or substitute its own judgment for that of the administrative agency on the weight of the evidence or questions of fact.”  (Emphasis added;  internal quotation marks omitted.)  Cadlerock Properties Joint Venture, L.P. v. Commissioner of Environmental Protection, supra, 253 Conn. 676.   It is well-settled that “[t]he issue of apparent authority is one of fact”;  Coppola Construct Co. v. Hoffman Enterprises, Ltd., supra, 309 Conn. 353.   The facts contained in the record are insufficient to support a claim that Catholic Charities acted as the apparent agent of DSS.

C. Unjust Enrichment

The plaintiff contends that DSS will be unjustly enriched if it is allowed to recover from her because the DSS should, instead, collect child care assistance overpayments from Catholic Charities.   DSS argues that the plaintiff failed to raise an unjust enrichment argument at the administrative hearing and, therefore, it should not be considered by the court in this appeal.   DSS further contends that the plaintiff's unjust enrichment argument is inapplicable against DSS, even if it had been raised at the hearing.

“Unjust enrichment applies wherever justice requires compensation to be given for property or services rendered under a contract, and no remedy is available by an action on the contract ․ A right of recovery under the doctrine of unjust enrichment is essentially equitable, its basis being that in a given situation it is contrary to equity and good conscience for one to retain a benefit which has come to him at the expense of another ․ With no other test than what, under a given set of circumstances, is just or unjust, equitable or inequitable, conscionable or unconscionable, it becomes necessary in any case where the benefit of the doctrine is claimed, to examine the circumstances and the conduct of the parties and apply this standard ․ Unjust enrichment is, consistent with the principles of equity, a broad and flexible remedy ․ Plaintiffs seeking recovery for unjust enrichment must prove (1) that the defendants were benefited, (2) that the defendants unjustly did not pay the plaintiffs for the benefits, and (3) that the failure of payment was to the plaintiffs' detriment.”  (Internal quotation marks omitted.)  Vertex, Inc. v. Waterbury, 278 Conn. 557, 573, 898 A.2d 178 (2006).

A review of the administrative record indicates that the plaintiff never presented evidence regarding unjust enrichment at the administrative hearing.   The Hearing Officer, therefore, never had the opportunity to consider the plaintiff's unjust enrichment argument.   Consequently, this court will not consider that ground during this appeal.   See Finkenstein v. Administrator, Unemployment Compensation Act, supra, 192 Conn. 114.

Moreover, even if the court were to reach the merits of this claim, it cannot reverse the Hearing Officer's decision.   An unjust enrichment claim must be brought against a party who received a benefit.   The record reveals, however, that DSS incorrectly paid child care assistance benefits on behalf of the plaintiff to Catholic Charities.   DSS regulations proscribe that “the parent shall be responsible for repaying the overpayment [of child care benefits] unless the overpayment was caused solely by the provider ․” (Emphasis added.)  Regs., Conn. State Agencies § 17b–749–20(e)(1).

In the present case, the plaintiff does not dispute that she failed to notify Care 4 Kids within ten days of losing her employment, despite undertaking the duty to do so in her Care 4 Kids application.   As a result, even if the plaintiff's unjust enrichment argument was properly brought at the administrative hearing, substantial evidence on the record reveals that the overpayments were not caused solely by Catholic Charities;  there is no reason the payments would have ceased without the plaintiff notifying Care 4 Kids about her job loss.

The plaintiff also argues that she did timely report her job loss to the DSS by informing a DSS worker at the Waterbury regional office.   She also argues that Catholic Charities should have reported her job loss to Care 4 Kids, but instead wrongfully continued to bill the program.   These assertions are without merit.

First, in her application the plaintiff represented that she, not Catholic Charities, would report any changes in her income or hours of employment.   In addition, the plaintiff agreed not to notify DSS generally, but specifically to inform the Care 4 Kids program within ten days of any change to her employment status.   R. 27.  “I must report any changes in my situation to Care 4 Kids within 10 days of the change, including but not limited to changes in address, income, household size, child care provider, hours of employment or training, additional hours of care, etc.”   R. 27.   She also signed:  “I may also be subject to criminal or civil charges ․ if I do not timely report changes affecting payments or my eligibility for this program.”   R. 31.

The notices that were sent to the plaintiff by Care 4 Kids on February 4, 2011 state:  “If you have any questions, need to report a change, or do not agree with this Certificate, call 1–888–214–KIDS (5437) or your Counselor at the phone number listed at the top of this notice.”   R. 35;  R. 37.   The top of the notice provides the address and toll free number of Care 4 Kids. Thus, substantial evidence in the administrative record establishes that the plaintiff failed to her obligation to notify Care 4 Kids in a timely manner.

The obligation to notify the CARE 4 Kids program specifically is, for obvious reasons, not unreasonable.   The DSS is a massive state agency, with numerous benefit programs that are administered under federal and state law and with varying requirements.   The Hearing officer's conclusion that notice to DSS generally was insufficient is not arbitrary or capricious.

This court additionally disagrees with the plaintiff's assertion that it would be unjust to hold her liable for the overpayment of child care benefits.   Substantial evidence in the administrative record supports the Hearing Officer's findings that, from March 1, 2011, through July 29, 2011, the plaintiff enrolled her child in child care services, received the benefits of those services and was incorrectly rewarded subsidies for those services by Care 4 Kids. DSS attempts to collect overpayments made to Catholic Charities that were used to subsidize child care for the plaintiff's child is simply not unjust.   Consequently, the plaintiff's unjust enrichment argument would be inapplicable in the present appeal even if it had been properly raised at the administrative hearing.

CONCLUSION

For the reasons set forth above, the court concludes that the Hearing Officer's decision, ordering the plaintiff to repay DSS $2,001.35 for the child care assistance improperly paid for her benefit to Catholic Charities, must be affirmed.   Judgment shall enter accordingly.

Hon. Eliot D. Prescott

FOOTNOTES

FN1. This requirement is set forth in § 17b–749–02(b)(3)(F) of the Regulations of Connecticut State Agencies, which provides in relevant part:  “Parents shall report changes in household circumstances and child care arrangements within ten days of the date of the change, including but not limited to the following circumstances ․ employment status, including a change in employers, income, work schedule or work hours.”.  FN1. This requirement is set forth in § 17b–749–02(b)(3)(F) of the Regulations of Connecticut State Agencies, which provides in relevant part:  “Parents shall report changes in household circumstances and child care arrangements within ten days of the date of the change, including but not limited to the following circumstances ․ employment status, including a change in employers, income, work schedule or work hours.”

FN2. Section 17b–749–04(e)(2)(A) of the Regulations of Connecticut State Agencies provides in relevant part:  “To be eligible for assistance, child care shall be needed to allow parents to participate in the following approved activities ․ employment for which the individual receives wages as opposed to goods or services for compensation.”.  FN2. Section 17b–749–04(e)(2)(A) of the Regulations of Connecticut State Agencies provides in relevant part:  “To be eligible for assistance, child care shall be needed to allow parents to participate in the following approved activities ․ employment for which the individual receives wages as opposed to goods or services for compensation.”

FN3. The plaintiff challenges the Hearing Officer's determination that the plaintiff “continued to bring her child to daycare ” after she lost her employment.  (Emphasis added.)   The plaintiff claims that “she never wanted daycare for her daughter because she already had a daycare provider” and instead only sent her daughter to Catholic Charities “for a pre-school enrichment experience.”   The plaintiff additionally argues that she did not need day care and would never have enrolled her child if she knew about Care 4 Kids' requirements because she worked at night, not during the day.General Statutes § 17b–749 provides in relevant part:  “The Commissioner of Social Services shall establish and operate a child care subsidy program to increase the availability, affordability and quality of child care services for families with a parent or caretaker is working ․” (Emphasis added.)  “Child care” is defined as “the care and supervision of an eligible child for not more than twelve hours in a twenty-four hour day, excluding therapy, medical treatment and public or private school or academic programs.”  Regs., Conn. State Agencies § 17b–749–01(9).There is no dispute that the plaintiff applied for and received the benefit of care and supervision for her child from Catholic Charities.   Regardless of whether the plaintiff wanted “day care” or a “pre-school enrichment experience,” she chose to enroll her child in a child care service and agreed to undertake certain obligations to receive child care assistance benefits.   Therefore, whether child care services she received for her child are referred to as “daycare” or “pre-school enrichment” has no bearing on the outcome of this appeal..  FN3. The plaintiff challenges the Hearing Officer's determination that the plaintiff “continued to bring her child to daycare ” after she lost her employment.  (Emphasis added.)   The plaintiff claims that “she never wanted daycare for her daughter because she already had a daycare provider” and instead only sent her daughter to Catholic Charities “for a pre-school enrichment experience.”   The plaintiff additionally argues that she did not need day care and would never have enrolled her child if she knew about Care 4 Kids' requirements because she worked at night, not during the day.General Statutes § 17b–749 provides in relevant part:  “The Commissioner of Social Services shall establish and operate a child care subsidy program to increase the availability, affordability and quality of child care services for families with a parent or caretaker is working ․” (Emphasis added.)  “Child care” is defined as “the care and supervision of an eligible child for not more than twelve hours in a twenty-four hour day, excluding therapy, medical treatment and public or private school or academic programs.”  Regs., Conn. State Agencies § 17b–749–01(9).There is no dispute that the plaintiff applied for and received the benefit of care and supervision for her child from Catholic Charities.   Regardless of whether the plaintiff wanted “day care” or a “pre-school enrichment experience,” she chose to enroll her child in a child care service and agreed to undertake certain obligations to receive child care assistance benefits.   Therefore, whether child care services she received for her child are referred to as “daycare” or “pre-school enrichment” has no bearing on the outcome of this appeal.

FN4. The plaintiff's contention that she actually sought to enroll her child in the Waterbury School Readiness Program, which is funded by the State Department of Education, instead of Care 4 Kids has no relevance to this appeal.   This appeal concerns overpayments of Care 4 Kids benefits by DSS, a program to which she chose to apply, and not a different program run by a separate agency..  FN4. The plaintiff's contention that she actually sought to enroll her child in the Waterbury School Readiness Program, which is funded by the State Department of Education, instead of Care 4 Kids has no relevance to this appeal.   This appeal concerns overpayments of Care 4 Kids benefits by DSS, a program to which she chose to apply, and not a different program run by a separate agency.

FN5. The plaintiff has asserted that she did not understand the Care 4 Kids application, including that by signing it she was agreeing to (1) accept state benefits, report any changes in income to Care 4 Kids within ten days, and repay any overpayments, even if they were caused by an administrative error.“The general rule is that where a person [who is] of mature years and who can read and write, signs or accepts a formal written contract affecting [her] pecuniary interests, it is [that person's] duty to read it and notice of its contents will be imputed to [that person] if [that person] negligently fails to do so ․” (Internal quotation marks omitted.)   Phoenix Leasing, Inc. v. Kosinski, 47 Conn.App. 650, 654, 707 A.2d 314 (1998).   The plaintiff presented no evidence demonstrating that fraud or artifice caused her to sign the application.   Therefore, notwithstanding her claimed ignorance, knowledge of the contents of the signed Care 4 Kids application must be imputed to the plaintiff..  FN5. The plaintiff has asserted that she did not understand the Care 4 Kids application, including that by signing it she was agreeing to (1) accept state benefits, report any changes in income to Care 4 Kids within ten days, and repay any overpayments, even if they were caused by an administrative error.“The general rule is that where a person [who is] of mature years and who can read and write, signs or accepts a formal written contract affecting [her] pecuniary interests, it is [that person's] duty to read it and notice of its contents will be imputed to [that person] if [that person] negligently fails to do so ․” (Internal quotation marks omitted.)   Phoenix Leasing, Inc. v. Kosinski, 47 Conn.App. 650, 654, 707 A.2d 314 (1998).   The plaintiff presented no evidence demonstrating that fraud or artifice caused her to sign the application.   Therefore, notwithstanding her claimed ignorance, knowledge of the contents of the signed Care 4 Kids application must be imputed to the plaintiff.

FN6. The plaintiff asserts that she should never have been found eligible to receive Care 4 Kids benefits because her child received child care for more hours than agency regulations allowed.   The plaintiff's arguments regarding her general eligibility to the program, however, are irrelevant to this appeal.   The plaintiff's signature indicated that she agreed to repay incorrectly paid Care 4 Kids benefits, including those caused by administrative errors.   That DSS may have made mistakes in determining the plaintiff's eligibility does not relieve her obligation to repay incorrectly distributed child care benefits..  FN6. The plaintiff asserts that she should never have been found eligible to receive Care 4 Kids benefits because her child received child care for more hours than agency regulations allowed.   The plaintiff's arguments regarding her general eligibility to the program, however, are irrelevant to this appeal.   The plaintiff's signature indicated that she agreed to repay incorrectly paid Care 4 Kids benefits, including those caused by administrative errors.   That DSS may have made mistakes in determining the plaintiff's eligibility does not relieve her obligation to repay incorrectly distributed child care benefits.

FN7. DSS incorrectly argues that “estoppel cannot be asserted against a state agency.”   Although estoppel may, theoretically, be asserted against a state agency, it can be invoked only with “great caution” and under very limited circumstances.   See Fadner v. Commissioner of Revenue Services, supra, 281 Conn. 726.   Moreover, neither the plaintiff nor this court could find any appellate authority applying estoppel against a state agency..  FN7. DSS incorrectly argues that “estoppel cannot be asserted against a state agency.”   Although estoppel may, theoretically, be asserted against a state agency, it can be invoked only with “great caution” and under very limited circumstances.   See Fadner v. Commissioner of Revenue Services, supra, 281 Conn. 726.   Moreover, neither the plaintiff nor this court could find any appellate authority applying estoppel against a state agency.

Prescott, Eliot D., J.