Day v. Seblatnigg

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DAY v. SEBLATNIGG—CONCURRENCE
MCDONALD, J., with whom PALMER, MULLINS,
KAHN and ECKER, Js., join, concurring. I agree with
and join the majority opinion but write separately to
address two concerns. First, the unusual posture of this
case as it ultimately was presented to this court required
resolution of a narrow question that leaves several sig-
nificant questions unanswered regarding the intersec-
tion of trusts and conservatorships. This is unfortunate,
and I take this opportunity to explain why these ques-
tions, had they been properly presented in this case,
might have compelled a different outcome than the one
the majority reaches today. Second, this case reveals
the need for legislative review of voluntary conservator-
ships, which were not a focus of the 2007 legislative
reforms. See Public Acts 2007, No. 07-116. I therefore
take this opportunity to draw attention to this matter
so that the legislature is on notice about these potential
policy matters.
I
I begin by making clear what this court does and
does not decide in the present case. The only question
before this court is whether a voluntary conservatorship
creates a relationship of joint authority, such that a
voluntarily conserved1 person may continue to manage
her affairs as she is able. It is on this basis that the
defendant First State Fiduciaries, LLC, challenges the
Appellate Court’s conclusion that Susan D. Elia lacked
the legal authority to create the Delaware irrevocable
trust. It is important to underscore that the Appellate
Court’s holding, and, in turn, this certified appeal, rests
on an unchallenged assumption, namely, that the former
conservator of Elia’s estate, Renee F. Seblatnigg, had
the authority to create the Delaware irrevocable trust,
subject to meeting the conditions prescribed in General
Statutes (Rev. to 2011) § 45a-655 (e). After all, if the
conservator lacked such authority, there would be no
issue of joint authority. If we were so permitted, there
would be several reasons to question this assumption,
which appears to be the sole impediment to Elia’s legal
authority to create the irrevocable trust.
The majority opinion recognizes that involuntarily
conserved persons have the statutory right to retain
exclusive authority over those matters that they are
capable of managing, with or without support from
a source other than a conservatorship. See General
Statutes (Rev. to 2011) § 45a-650 (k) and (l) (now § 45a-
650 (l) and (m), respectively). The statutory scheme
suggests; see General Statutes (Rev. to 2011) § 45a-646;
and logic dictates that voluntarily conserved persons
similarly can obtain a limited conservatorship. They
may do so by simply designating in their application
for voluntary representation which specific matters
should be delegated to the conservator, thus retaining
exclusive authority over all undesignated matters.2 The
standard Probate Court form for such applications pro-
vides a field to make such limited designations. See
Petition/Voluntary Representation by Conservator, Form
PC-301, p. 2 (last modified January, 2021), available at
www.ctprobate.gov/Forms/PC-301.pdf (last visited Jan-
uary 20, 2022) (‘‘I would like a conservator appointed
to assist me with the following financial matters’’). Elia
did not make such a limited designation in her applica-
tion.
There would be no need for Elia to make such a
limited designation, however, if her broad grant of
authority to manage her estate did not include the
authority to create the irrevocable trust and to fund it
with a transfer of funds from her revocable trust. Two
theories might support such a proposition.
First, certain matters cannot be delegated to the con-
servator. See, e.g., 39 Am. Jur. 2d 113, Guardian and
Ward § 117 (2008) (‘‘[a]s a general rule, a guardian may
not waive legal rights on behalf of [the guardian’s] ward,
surrender or impair rights vested in the ward or impose
any legal burden thereon, or exercise purely personal
elective rights of [the guardian’s] ward’’ (footnotes omit-
ted)); see also, e.g., Newman v. Newman, 42 Ill. App.
2d 203, 213, 191 N.E.2d 614 (1963) (‘‘certain powers,
rights, or elections may be so personal that they cannot
be exercised on behalf of an incompetent [by a conser-
vator]’’); Estate of Townson ex rel. East Tennessee
Human Resources Agency v. Estate of East ex rel.
Cooley, 297 S.W.3d 736, 738 (Tenn. App. 2009) (conser-
vator ‘‘has no authority to exercise an elective right or
power of the conservatee’’ (internal quotation marks
omitted)), appeal denied, Tennessee Supreme Court,
Docket No. E2008-00689-SC-R11-CV (August 31, 2009).
The execution of a testamentary instrument, desig-
nating how and to whom the conserved person’s assets
will be distributed upon his or her death, is one such
matter. See generally 1 Restatement (Third), Trusts
§ 11, comments (a) through (d), pp. 160–62 (2003)
(addressing testamentary capacity of persons under
conservatorship). Authority to make testamentary dis-
positions for the conserved person cannot be delegated
to the conservator both because such rights are purely
personal and because the conservator’s authority
extends only to the lifetime interests (support and care)
of the conserved person. See, e.g., Citizens State
Bank & Trust Co. of Hiawatha v. Nolte, 226 Kan. 443,
449, 601 P.2d 1110 (1979) (‘‘[A conservator’s duty] is to
manage the estate during the conservatee’s lifetime. It
is not his function, [or] that of the [P]robate [C]ourt
supervising the conservatorship, to control disposition
of the conservatee’s property after death.’’); In re Estate
of Briley, 16 Kan. App. 2d 546, 549, 825 P.2d 1181 (1992)
(recognizing that right to change beneficiary of account
‘‘is a purely personal elective right of the conservatee’’
and that ‘‘[t]he decision regarding distribution of the
conservatee’s property after death belongs to the con-
servatee’’); see also, e.g., In re Estate of Garrett, 81
Ark. App. 212, 218, 100 S.W.3d 72 (2003) (stating that will
making requires ‘‘ ‘personal performance’ ’’ and thus
cannot be delegated).
The majority properly declines to address whether
Elia had the testamentary capacity to create the irrevo-
cable trust because that issue was neither preserved3
nor adequately briefed. See footnote 18 of the majority
opinion and accompanying text. Review of the trial
court record reveals that the irrevocable trust is not,
strictly speaking, a testamentary trust. It was not cre-
ated by a will; see, e.g., 1 Restatement (Third), supra,
§ 17, p. 250; see also, e.g., Public Acts 2021, No. 21-39,
§ 1 (effective January 1, 2022), to be codified at General
Statutes (Supp. 2022) § 45a-499c (29); and it vested dis-
cretion in the trustees to make distributions in any
amount during Elia’s lifetime to Elia, her grandchildren,
or any charitable institute. See, e.g., Cate-Schweyen v.
Cate, 303 Mont. 232, 239–40, 15 P.3d 467 (2000) (‘‘A
testamentary trust . . . not only must comply with the
statutory requirements for a will, but also must take
effect only upon the testator’s death. . . . Therefore,
a testamentary disposition is usually incompatible with
a trust established by a trustor who retains a life inter-
est, as a beneficiary of the trust, although a new benefi-
ciary or beneficiaries acquire an interest upon the trus-
tor’s death.’’ (Citations omitted; internal quotation
marks omitted.)) Whether such a trust should be char-
acterized for present purposes as a purely testamentary
act, a partially testamentary act requiring concurrent
action by the conservator and conserved person, or not
a testamentary act at all is a difficult issue best left to
a case in which it is the subject of adversarial briefing.
The unfortunate effect of the present case is that Elia
may have had testamentary capacity when she created
the irrevocable trust and, yet, her trust assets will not
be distributed in accordance with her wishes following
her death, which occurred during the pendency of
this appeal.
The second theory that might excuse the need for
Elia to make a limited designation of authority to her
conservator to reserve her right to create the irrevoca-
ble trust would depend on whether such a right is
encompassed in the authority to manage the conserved
person’s ‘‘estate.’’ General Statutes (Rev. to 2011) § 45a-
655 (a). If a conserved person’s present interest in a
trust is not part of the conservatorship estate, a good
argument could be made that Elia retained the authority
to create and fund a trust, as long as she did not use
assets of her estate to do so.4 In the absence of evidence
that Elia lacked the mental capacity to make decisions
with regard to her trusts, she would retain the legal
capacity to revoke or modify the Connecticut revocable
trust, to create the Delaware irrevocable trust, and to
request that the trustee of her revocable trust—who
also happened to be her conservator—transfer funds
to the irrevocable trust.
This theory finds some support in both the statutory
text and case law.5 The only explicit discussion of trusts
in the conservatorship scheme is in General Statutes
(Rev. to 2011) § 45a-655 (e). That subsection prescribes
conditions for ‘‘transfers of income and principal from’’
the conserved person’s estate to a trust, existing or
created by the conservator. General Statutes (Rev. to
2011) § 45a-655 (e). The word ‘‘from’’ suggests that the
transfer depletes assets of the estate by directing them
to a source outside the estate. If an existing trust or a
new trust created by the conservator into which income
was transferred was part of the estate, the transfer
would be ‘‘within’’ or ‘‘to’’ the estate, not ‘‘from’’ the
estate.6
This court’s decision in Dept. of Social Services v.
Saunders, 247 Conn. 686, 724 A.2d 1093 (1999), lends
support to this view. The issue in that case was ‘‘whether
the Probate Court was authorized to permit a conserva-
trix to establish an irrevocable inter vivos trust funded
with the net proceeds recovered in the settlement of a
negligence action filed on her ward’s behalf, which
would not be considered an available resource for the
purpose of determining ongoing [M]edicaid eligibility.’’
Id., 687. The Superior Court decision answering that
question in the negative, which this court reversed on
appeal, was in fact the impetus for the 1998 amendment
to General Statutes (Rev. to 1997) § 45a-655 (e) expressly
authorizing such an act. See id., 697, 702–704, 715. This
court’s decision in Saunders is noteworthy for its recog-
nition of the effect of the transfer on the estate and on
the conservator’s control of the transferred assets. The
plaintiff department characterized the transfer into the
trust as an act that had ‘‘divest[ed] the estate by transfer-
ring its assets to an inter vivos trustee’’; id., 709; and
‘‘eliminate[d] [the ward’s] estate in its entirety and trans-
fer[red] it to a trustee.’’ (Internal quotation marks omit-
ted.) Id. The court in Saunders accepted this premise
but nonetheless viewed the Probate Court’s permission
for the conservator to create the trust to be a proper
exercise of that court’s authority because the trust
assets were still available for the ward’s care and sup-
port through his exclusive equitable interest and that
court would have jurisdiction over both the trustee and
the conservator. See id., 709–12. In Saunders, this court
also rejected the plaintiff department’s argument that
the transfer of the ward’s assets to the trust ‘‘would
constitute an improper delegation of the Probate
Court’s responsibility, acting through the conservator,
to manage [the ward’s] estate’’ because the Probate
Court has ‘‘plenary authority to manage a ward’s estate’’
but only limited authority to ‘‘review actions of a trustee
of an inter vivos trust . . . .’’ Id., 710. This court
acknowledged that the conservator’s authority in rela-
tion to the trust would be limited to the management
of funds distributed by the trustees, who would actually
manage the trust in accordance with the terms of the
trust instrument.7 See id., 710–11; see, e.g., Ramsdell v.
Union Trust Co., 202 Conn. 57, 70, 519 A.2d 1185 (1987)
(‘‘the duties of the conservator and those of the trustees,
and the potential liabilities arising from the breaches
of these duties, are completely distinct’’); see also, e.g.,
1 Restatement (Second), Trusts § 175, comment (f), p.
381 (1959) (‘‘[t]he duty of the trustee is not only to
take and keep control, but to take and keep exclusive
control’’); R. Folsom & L. Beck, Connecticut Estates
Practice Series: Drafting Trusts in Connecticut (2d Ed.
2021) § 1:15, p. 16 (explaining that statutes and legal
principles ‘‘[suggest] that the [c]onservator should not
have authority to exercise the [g]rantor’s right to revoke
or amend the trust’’).
There may well be persuasive counterarguments. The
questions of whether trusts are part of the estate, sub-
ject to the conservator’s management, and, if not,
whether Elia retained the legal authority to create the
irrevocable trust are not, however, properly before this
court. The defendant did argue before the Appellate
Court that the assets in the revocable trust were not
part of the conservatorship estate but made no argu-
ment that this fact had any bearing on the question of
Elia’s legal authority to create the irrevocable trust. See
Day v. Seblatnigg, 186 Conn. App. 482, 506 n.10, 199
A.3d 1103 (2018). The Appellate Court reasonably con-
strued the defendant’s argument to be related exclu-
sively to the question of whether Seblatnigg had the
legal authority to transfer the revocable trust assets
and determined that it was unnecessary to address that
argument in light of its conclusion that Elia lacked legal
authority to create the irrevocable trust. See id. The
defendant did not argue in its petition for certification
to appeal to this court that the Appellate Court improp-
erly had failed to reach this issue because it was directly
connected to the question of whether Elia had authority
to create the irrevocable trust.8 We therefore must leave
to another day the questions of whether trusts are part
of the conservatorship estate and, if not, whether a
conserved person retains exclusive authority to create
and fund trusts with assets that are not part of the
conservatorship estate.
II
I also take this opportunity to highlight the possibility
that the legislature may wish to consider revisions to
the conservatorship scheme as it applies to voluntary
representation, which was not directly considered in
the 2007 reforms.
As the majority explains, it is not uncommon for
persons seeking voluntary representation to have the
same degree of incapacity as involuntarily conserved
persons, whether at the time the application is submit-
ted or sometime thereafter. See, e.g., Conn. Joint Stand-
ing Committee Hearings, Judiciary, Pt. 1, 1977 Sess., p.
190, testimony of Probate Judge Bernard F. Joy; see
also, e.g., Public Acts 1987, No. 87-87. This fact would
suggest that some members of the former class may be
equally vulnerable to some of the abuses that prompted
the 2007 reforms. Yet, because the statutory definition
of a ‘‘conserved person’’ includes only involuntarily con-
served persons; see General Statutes § 45a-644 (h); it
appears that protections available in involuntary con-
servatorships are unavailable in voluntary conservator-
ships. Those protections include the right to clear notice
of the legal consequences of the appointment of a con-
servatorship, including the fact that conserved persons
‘‘will lose some of [their] rights’’; (internal quotation
marks omitted) General Statutes § 45a-649 (b); the right
to appointed counsel, the right to have the Probate
Court ascertain whether the applicant has the capacity
to retain certain rights, and the right to periodic judicial
review of the conservatorship to ascertain whether the
court should modify or terminate the conservatorship.
See General Statutes §§ 45a-649 (d), 45a-649a, 45a-650
(m) and 45a-660 (c). The only right provided to the
person in a proceeding for voluntary representation,
other than to be present and heard, is that the court
shall ‘‘[explain] to the [applicant] that granting the peti-
tion will subject the [applicant] or the [applicant’s] prop-
erty . . . to the authority of the conservator . . . .’’
General Statutes § 45a-646.
Perhaps not all of the procedural protections afforded
to involuntarily conserved persons are necessary when
the conservatorship is being requested, rather than
imposed, and the voluntarily conserved person has the
distinct right to terminate the conservatorship at will,
with thirty days notice. See General Statutes § 45a-647.
But the present case illustrates the pitfalls of the lack
of any explicit procedural requirements. The Probate
Court made no effort to ascertain what authority, if
any, Elia wanted to retain or what limits, if any, she
wanted to place on her conservatorship. The court’s
explanation of the legal consequences of the appoint-
ment of a conservator of Elia’s estate; see footnote 13
of the majority opinion; could have misled Elia to
believe that she retained authority over her entire estate
and had given Seblatnigg authority only to act as her
agent under a relationship of joint authority. Hopefully,
this court’s opinion in this case will provide clearer
direction on that matter.
1
For consistency with the majority opinion, I also refer to a voluntarily
represented person as ‘‘voluntarily conserved,’’ mindful that such persons
do not fall within the definition of a conserved person and have not been
found by a court to be incapable of managing their affairs. See General
Statutes § 45a-644 (g) and (h); General Statutes (Rev. to 2011) § 45a-646.
2
The exercise of such authority may nonetheless be rendered void if it
is demonstrated that the voluntarily conserved person lacked the requisite
mental capacity to undertake the act in question. See, e.g., 1 Restatement
(Third), Trusts § 11, comment (e), pp. 162–63 (2003).
3
As the majority notes, the defendant had cast the question before the
Appellate Court as a question of Elia’s capacity to contract, and that court
viewed it as such. See footnote 18 of the majority opinion. I note that there
is authority indicating that the creation of a trust is not contractual in nature.
See, e.g., Tunick v. Tunick, 201 Conn. App. 512, 525–26, 242 A.3d 1011(2020), cert. denied, 336 Conn. 910, 244 A.3d 561 (2021); see also id. (citing
authorities).
4
The defendant pointed out in its memorandum in support of its motion
to strike the complaint filed by the plaintiff, Margaret E. Day, coconservator
of Elia’s estate, that the schedule to the trust instrument recited that $1
was the property conveyed to the irrevocable trust at the time of its establish-
ment, and that the complaint made no allegation that this sum came from
conservatorship estate assets. The trial court did not rule on this motion,
filed well after the plaintiff filed her motion for summary judgment, and the
defendant’s appellate briefs appear to assume that the irrevocable trust was
funded by a transfer from the revocable trust.
5
There is an indication in the trial court record that Elia and the Probate
Court judge who granted her application for representation did not view
the revocable trust to be part of the estate. One of the defendant’s filings
in opposition to the motion for summary judgment recited an exchange that
purportedly occurred at a Probate Court hearing at which Elia’s children
unsuccessfully sought to have Elia found incapable of managing her affairs
and involuntarily conserved. At that proceeding, a question was raised about
the omission of Elia’s revocable trust from Seblatnigg’s inventory of the
estate. Both the judge and Elia’s counsel made comments indicating that
they understood the revocable trust to be outside the conservatorship estate
and, thus, properly excluded from the inventory required under § 45a-655
(a). The defendant did not renew this argument in its Appellate Court brief,
and nothing in the record indicates how or whether the plaintiff responded
to this argument before the trial court.
6
The trial court concluded that the revocable trust assets were part of
the conservatorship estate, pointing to the conservator’s duty under § 45a-
655 (a) to include ‘‘equitable present interest[s]’’ in an inventory of the
conserved person’s estate and the uncontested fact that Elia held an equita-
ble interest in the Connecticut revocable trust. Even if we assume that the
conservator has the duty to include trust assets in the inventory, I do not
view that fact as dispositive of the question of whether the trust is part of
the estate, subject to the conservator’s management. Cf. In re Conservator-
ship of Addison v. Touchstone, 242 So. 3d 926, 935–36 (Miss. App. 2018)
(‘‘joint accounts created prior to the [ward’s] incapacity [are] not subject
to being marshalled by the conservator, although the funds may be used if
necessary to pay for the care and expenses of the ward during his lifetime’’
(internal quotation marks omitted)). If trusts are part of the estate, however,
that would raise the question of whether a transfer of funds from one trust
to another would be a transfer ‘‘from’’ the estate.
7
I am not suggesting that the conservator would lack authority to request
a distribution from the trust for the conserved person’s support in accor-
dance with the terms of the trust or to file an action on the conserved
person’s behalf to compel the trustees to meet their fiduciary obligations.
8
The defendant petitioned this court for certification of two issues: (1)
whether the Appellate Court correctly determined that Elia did not retain
any control over her estate; and (2) whether ‘‘the trial court err[ed] when
it concluded that [General Statutes (Rev. to 2011)] § 45a-655 (e), a statute
directed solely to the conduct of conservators, applied to the conduct of a
voluntarily conserved person.’’ (Emphasis added.) We granted certification,
limited to the first issue. See Day v. Seblatnigg, 331 Conn. 913, 204 A.3d
702 (2019); see also footnote 5 of the majority opinion (reframing certi-
fied question).