Trial court lacked jurisdiction to rule on SSA benefits case, COA affirms in upholding dismissal of complaint

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The federal Social Security Act preempts a woman’s state tort claims and a trial court ruled correctly that it lacked subject matter jurisdiction in the case, the Court of Appeals of Indiana affirmed Monday in dismissing a complaint involving an estate’s Social Security Administration benefits.

Before he died, Julian Roache was under a legal disability and received SSA benefits.

Anita Woodson was appointed the representative payee of Roache’s SSA benefits and received some of those benefits in her role as payee.

Roache died in January 2017 and Ronda Randall assumed her role as personal representative of Julian’s estate.

In January 2019, Randall filed a complaint against Woodson, raising claims of breach of fiduciary duty, fraud, conversion, and unjust enrichment.

She alleged that Woodson had engaged in a pattern of improperly transferring assets belonging to Roache and the Julian M. Roache Revocable Trust from December 2013 to January 2017.

Woodson filed a motion to dismiss based on two claims.

The first claim stated that the allegation of the complaint based on the trust’s assets were subject to dismissal under Indiana Trial Rule 12(B)(6).

The second claim stated the allegations of the complaint seeking to recover Roache’s SSA benefits were subject to dismissal under Indiana Trial Rule 12(B)(1), alleging the claims were preempted by federal law and thus depriving the trial court of subject matter jurisdiction.

The Marion Superior Court held a non-evidentiary hearing on Woodson’s motion to dismiss in October 2022.

Ten days later, the trial court dismissed the complaint, without entering any findings of fact or conclusions of law.

Randall appealed the trial court’s granting of Woodson’s Trial Rule 12(B)(1) motion to dismiss her claims pertaining to Julian’s SSA benefits for want of subject matter jurisdiction.

The appellate court stated the facts aren’t in dispute and therefore its review is de novo.

The second issue before the court is whether Randall’s state law claims are barred by federal law.

“Randall does not draw our attention to any portion of the (Social Security Act) which specifically and expressly outlines the scope of its preclusive effect, or which expressly provides state courts with concurrent jurisdiction over claims such as hers, and we located none,” Judge Patricia Riley wrote. “However, as set forth above, there exists within the Act and federal regulations a comprehensive scheme directed at preventing, identifying, and rectifying the misuse of benefit funds by representative payees. That scheme defines what constitutes misuse of benefits and provides mechanisms within the SSA for determining when misuse has occurred, for the recovery of benefits from the representative payee, and for payment of misused benefits to the beneficiary or an alternate representative payee.”

Riley added that the appellate court’s conclusion finds support from several federal district courts that have held no federal private right of action exists against representative payees to recoup missed SSA benefits.

“In addressing this argument, we first observe that the Act does not further define the term ‘competent jurisdiction’, and Randall does not present us with any relevant authority from either a federal or state court in this or any other jurisdiction concluding that the use of the phrase ‘court of competent jurisdiction’ in the Act confers concurrent subject matter jurisdiction over a state court to entertain claims such as those presented in her Complaint,” Riley wrote. “However, the Act explicitly provides for both administrative and judicial review of the SSA’s initial determinations, including determinations concerning overpayment of benefits and determinations concerning the SSA’s negligence in investigating or monitoring representative payees.”

The appellate court has ruled that only Randall’s claims related to assets which were neither trust assets nor Roache’s SSA benefits may go forward.

The case is Ronda Randall, as Personal Representative of the Estate of Julian M. Roache, and as Personal Representative of the Estate of Joanne F. Roache, beneficiary of the Julian M. Roache Revocable Living Trust v. Anita J. Woodson, individually and in her capacity as Trustee of the Julian M. Roache Revocable Living Trust, 22A-PL-2830.