IN THE SUPREME COURT OF NORTH CAROLINA

No. 144A18

Filed 1 February 2019

CARLOS PACHAS, by his attorney in fact, JULISSA PACHAS,

Petitioner

v.

NORTH CAROLINA DEPARTMENT OF HEALTH AND HUMAN SERVICES,

Respondent

Appeal pursuant to N.C.G.S. § 7A-30(2) from the decision of a divided panel of 

the Court of Appeals, ___ N.C. App. ___, 814 S.E.2d 136 (2018), affirming an order

entered on 21 April 2017 by Judge W. Robert Bell in Superior Court, Mecklenburg

County. Heard in the Supreme Court on 1 October 2018.

Charlotte Center for Legal Advocacy, by Douglas Stuart Sea and Cassidy EstesRogers, for petitioner-appellant. 

Joshua H. Stein, Attorney General, by Lee J. Miller, Assistant Attorney General, 

for respondent-appellee.

John R. Rittelmeyer for Disability Rights North Carolina, amicus curiae.

HUDSON, Justice 

This case comes to us by way of petitioner’s notice of appeal based on a 

dissenting opinion in the Court of Appeals. We now review “whether the Court of 

Appeals erred as a matter of law in ruling that the superior court lacked jurisdiction 

to decide whether its previous order was being violated by a state agency on the 
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Opinion of the Court

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grounds that petitioner failed to exhaust administrative remedies before moving to 

enforce the court’s order.” Because we conclude that the superior court had 

jurisdiction to enforce its previous order, we vacate the Court of Appeals’ decision. 

Pachas v. N.C. Dep’t of Health & Human Servs., ___ N.C. App. ___, ___, 814 S.E.2d 

136, 137 (2018). Accordingly, we remand this case to the Court of Appeals to address

the merits of respondent’s argument that the North Carolina Department of Health 

and Human Services (DHHS) did not violate the 17 March 2016 order. 

I. Factual and Procedural Background

Petitioner Carlos Pachas, a resident of Mecklenburg County, and a Medicaid 

recipient, was left completely disabled and requiring twenty-four hour care as result 

of a stroke and a brain tumor in 2014. At the time, petitioner lived with his wife, 

their two minor children, and his wife’s elderly parents. All members of the

household were dependent on petitioner for their financial support. In January 2015, 

he began receiving Social Security Disability benefits, and thereafter applied for reenrollment in Medicaid.

On 5 May 2015, the Mecklenburg County Department of Social Services (DSS)

sent petitioner a notice that his currently ongoing Medicaid benefits would be 

terminated starting on 1 June 2015, and that he would need to meet a deductible of 

$6642 during the period of 1 May through 31 October 2015 to regain eligibility for 

Medicaid benefits. The DSS decision was based on the agency’s determination that 

petitioner, because of his monthly Social Security Disability benefits of $1369 that 
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began in January 2015, exceeded the income limit for an individual to qualify for 

Medicaid as “Categorically Needy”—the income limit being one hundred percent of 

the federal poverty level1—and that petitioner now qualified for Medicaid as

“Medically Needy” under DSS regulations. Under these regulations, “Categorically 

Needy” Medicaid recipients are not charged a deductible, but “Medically Needy” 

recipients are. Medicaid Eligibility Unit, Div. of Med. Assistance, N.C. Dep’t of 

Health & Human Servs., Aged Blind and Disabled Medicaid Manual, MA-2360 ¶ I

(Nov. 1, 2011).

Petitioner requested a hearing before DSS concerning the termination of his 

Medicaid benefits, and the hearing was held on 8 May 2015. On 13 May 2015, DSS 

sent petitioner a Notice of Decision affirming the termination of his Medicaid 

benefits. The Notice of Decision instructed petitioner that he could appeal the matter 

to DHHS. On the same day, petitioner filed a written request to appeal the decision, 

and the appeal was heard on 16 June. DHHS affirmed DSS’s decision requiring 

Pachas to meet a $6642 deductible in a Notice of Decision dated 10 August 2015. 

On 13 August, Pachas as petitioner appealed the unfavorable decision to 

DHHS, and he submitted his written appeal on 27 August 2015. In his appeal, 

petitioner maintained that DHHS erred in affirming the DSS decision to discontinue 

 

1 This income limit was established by the Current Operations and Capital 

Improvements Appropriations Act of 2013, sec. 12H.10.(a)-(b)(1), 2013 N.C. Sess. Laws

2013-360 (Regular Sess.) 995, 1180-81.
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his Medicaid benefits arguing that DSS’s method of calculating his income eligibility 

for Medicaid “violate[s] the plain language of the federal Medicaid statute and 

controlling North Carolina case law.” 

First, petitioner argued that DSS’s policy violates the plain language of the 

controlling federal Medicaid statute, 42 U.S.C. § 1396a(m). Petitioner stated that the 

General Assembly elected to provide Medicaid to aged, blind, and disabled persons 

with incomes under one hundred percent of the federal poverty level. Petitioner noted 

that beneficiaries who meet these criteria are considered to be “Categorically Needy,” 

and their eligibility for Medicaid is governed by 42 U.S.C. § 1396a(m). Petitioner 

then pointed to § 1396a(m)(2)(A), which states that a beneficiary’s income level is 

determined by considering “a family of the size involved.” Petitioner contended that 

this language required DSS to determine whether his monthly income from Social

Security Disability payments was more than one hundred percent of the federal 

poverty line if used not just to support himself, but to support all six members of his 

family as dependents. 

Second, petitioner argued that the North Carolina Court of Appeals’ decision 

in Martin v. North Carolina Department of Health and Human Services, 194 N.C. 

App. 716, 670 S.E.2d 629, disc. rev. denied, 363 N.C. 374, 678 S.E.2d 665 (2009), 

required DSS to determine whether petitioner’s income exceeded one hundred 

percent of the federal poverty guideline if used to support all six members of his 

family. According to petitioner, Martin involved a parallel Medicaid eligibility 
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category, Medicaid for Qualified Medicare Beneficiaries (MQB-B), which contained 

the same “family of the size involved” language. Petitioner further noted that the 

court in Martin held that “a family of the size involved” meant “a group consisting of 

parents and their children; a group of persons who live together and have a shared

commitment to a domestic relationship.” 194 N.C. App. at 722, 670 S.E.2d at 634. As 

a result, Pachas argued that Martin directed DHHS to consider his entire family 

when calculating whether his income rose above one hundred percent of the federal 

poverty level. 

Finally, petitioner pointed to a decision of the Superior Court in Mecklenburg 

County that he viewed as applying the reasoning in Martin to “all individuals who 

receive Medicaid benefits on the basis of disability.” See Cody v. N.C. Dep’t of Health 

& Human Servs., No. 13 CVS 19625 (N.C. Super. Ct. Mecklenburg County Mar. 11, 

2014). Additionally, petitioner argued that “failure to consider his wife, children and 

dependent parents as part of his family leads to absurd results and violates the

purpose of the Medicaid Act.” 

In its Final Decision, dated 1 October 2015, DHHS affirmed that petitioner

must meet a deductible in order to regain eligibility for Medicaid given that his 

income exceeded one hundred percent of the federal poverty guideline for a single 

individual. On 16 October 2015, petitioner sought judicial review of the DHHS Final 

Decision in the Superior Court in Mecklenburg County. Petitioner requested that the 

court grant the following relief: (1) reverse the final agency decision and declare 
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DHHS’s interpretation of the law illegal; (2) order DHHS to reinstate petitioner’s 

Medicaid benefits without requiring a deductible effective 1 June 2015; and (3) award 

petitioner costs and a reasonable attorney’s fee. In support of this request for relief, 

petitioner claimed, in pertinent part, that DHHS erred by “concluding that the 

Medicaid income limit applicable to Petitioner was the limit for a single individual in 

violation of 42 U.S.C. § 1396a(m), under which the applicable income limit is 100% of 

the federal poverty line for a ‘family of the size involved.’ ” 

On 17 March 2016,2 the Superior Court in Mecklenburg County signed an 

order reversing the final decision of DHHS. The superior court reached this 

determination because it concluded that: 

2. The North Carolina General Assembly has elected the

option under the federal Medicaid statute, 42 U.S.C. § 

1396a(m), to provide Medicaid to aged, blind and 

disabled persons with incomes under 100% of the 

federal poverty level. This category of Medicaid is 

known as categorically needy coverage for the aged, 

blind and disabled (MABD-CN).

3. The income limit for MABD-CN varies by the number 

of persons considered by the agency to be in the 

household unit because the federal poverty line varies 

by household size.

4. The DHHS Medicaid rule at issue in this case is 

contained in Section 2260 of the DHHS Adult Medicaid 

Manual. Under this provision, only the aged, blind or 

 

2 The dissenting judge at the Court of Appeals noted that although the order was 

entered on 18 March 2016, he was going to refer to the order as the 17 March 2016 order 

because that was how the parties had been referring to it. Pachas, ___ N.C. at ___, 814 

S.E.2d at 142 n.6 (Hunter Jr., J., dissenting). 
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disabled individual is considered to be part of the 

household unit used for determining the applicable 

income limit for MABD-CN. The only exceptions in 

this rule are where the spouse of the individual is also 

aged, blind or disabled, or where the spouse has income 

that is deemed available to the aged, blind or disabled 

individual, in which case the household size is two.

. . . .

6. Pursuant to the challenged DHHS rule, Mecklenburg 

County DSS determined that Mr. Pachas’ Social 

Security income of $1396 per month was greater than 

$981 per month, which is the current federal poverty 

limit for a household size of one person.

. . . .

8. The plain language of the controlling federal statutory 

provision, 42 U.S.C. § 1396a(m), states that the 

applicable Medicaid income limit for the MA[BD]-CN 

category must be based on a “family of the size 

involved.” Because the official poverty line published 

annually by the federal government varies by family 

size, the determination of family size determines the 

applicable income limit under the language of this 

statute.

9. The Federal Medicare and Medicaid agency has 

interpreted the language “a family of the size involved” 

to include “the applicant, the spouse who is living in 

the same household, if any, and the number of 

individuals who are related to the applicant or 

applicants, who are living in the same household and 

who are dependent on the applicant or the applicant’s 

spouse for at least one-half of their financial support.” 

42 C.F.R. § 423.772 (2005). 

10. There is no dispute in the record or the briefing that 

Petitioner is providing over half of the financial 

support for his wife, their two minor children and his 

wife’s elderly parents, all of whom live with Petitioner.
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11. In Martin v. North Carolina Department of Health and 

Human Services, the North Carolina Court of Appeals 

interpreted the identical phrase, “family of the size 

involved,” applied to similar facts, in reviewing a 

parallel provision of the federal Medicaid statute for 

the MQB category of benefits. The Court of Appeals 

held that the DHHS interpretation of “family of the 

size involved” for the MQB program violated the 

federal Medicaid statute and was therefore invalid.

12. Following the Martin decision, DHHS updated its 

Medicaid state plan and manual provisions to clarify 

that MQB eligibility must be based upon “family size” 

which includes “the [applicant/beneficiary], the spouse 

if there is one, and any dependent children under age 

18 living in the home.” However, DHHS did not change 

its rule as to the MABD-CN category.

13. The provisions of the Federal Medicaid statute at issue 

in Martin and in this case contain precisely the same 

language regarding both the determination of family 

size and the countable income for Medicaid 

beneficiaries. 

14. DHHS conceded at oral argument that prior to the 

Martin ruling, the same methodology for determining 

eligibility was used for both the MA[BD]-CN and MQB 

programs.

(second alteration in original). While reversing the DHHS final decision on these 

grounds, the superior court ordered, in pertinent part, that DHHS “promptly 

reinstate Medicaid benefits to Petitioner effective June 1, 2015 and [ ] continue 

providing Medicaid to Petitioner until determined ineligible under the rules as 

modified according to this decision.” 
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Following the superior court’s reversal of the DHHS final decision, on 13 April 

2016, DHHS instructed Mecklenburg County DSS to reinstate petitioner’s Medicaid 

benefits. Thereafter, following a hospital stay, Pachas entered a nursing facility on 

6 May 2016, and his Medicaid benefits continued the entire time he was in the 

nursing home; on 14 February 2017, he was discharged from the nursing facility and 

returned home to live with his family. Pachas suffered from anxiety as well as his 

physical conditions while being away from his family. Pachas was to receive at-home 

care under Medicaid’s Community Alternative Program for Disabled Adults (CAPDA). 

On the same day Pachas left the nursing facility and his care under CAP-DA 

was set to begin, Mecklenburg County DSS mailed him a notice that his benefits 

would be changed and, effective 1 March 2017, he would be required to meet a 

monthly deductible of $1113 for his CAP-DA care. In the notice DSS stated that the 

change in benefits was required by state regulations found in “MA 2280.” The notice 

also advised Pachas that he had sixty days to request an agency hearing if he 

disagreed with the decision. 

Instead of requesting an agency hearing, Pachas filed a motion in the cause to 

enforce the court’s order and a petition for writ of mandamus in the Superior Court 

in Mecklenburg County on 15 February 2017. In the motion and petition, Pachas 

requested the following relief pertinent to this appeal: (1) entry of an order enforcing 

the court’s 17 March 2016 order and directing North Carolina DHHS “to immediately 
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reinstate his Medicaid benefits, including his CAP-DA services,” and ordering that 

the benefits be continued without his having to first meet a deductible; (2) issuance 

of a writ of mandamus ordering DHHS to reinstate his benefits effective 14 February 

2017; and (3) entry of an order requiring Mecklenburg County DSS to reinstate his 

benefits if DHHS failed to do so within ten days of the court’s forthcoming order. 

On 6 March 2017, DHHS moved to dismiss petitioner’s motion and petition. 

DHHS argued, in pertinent part, that the motion and petition should be dismissed 

for these reasons: (1) the superior court did not have jurisdiction over the matter,

because petitioner had not exhausted his administrative remedies; (2) with regard to 

the petition for writ of mandamus specifically, that petitioner had another adequate 

remedy at law through the agency appeal process; and (3) petitioner’s eligibility for 

the CAP-DA program did not fall within the 17 March 2016 order, because the CAPDA program, which has its own eligibility and income limit rules under 42 U.S.C. § 

1396n, is a “Waiver” program that is separate from the “State Plan” that was the 

subject of the previous order. 

In support of his motion in the cause seeking enforcement of the 17 March 2016 

order and petition for writ of mandamus, petitioner argued that: (1) DHHS’s 

termination of all of petitioner’s Medicaid benefits on 14 February 2017 violated the 

17 March 2016 order which required DHHS to immediately reinstate petitioner’s

Medicaid benefits and continue to provide them until petitioner is “determined 

ineligible under the rules as modified according to [the order]”; (2) under the terms of
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DHHS’s waiver application for CAP-DA, and as stated in its own instruction 

manuals, individuals who qualify for Medicaid under the “Categorically Needy” 

eligibility group, the very category under which the 17 March 2016 order determined 

that petitioner’s benefits were to be reinstated and to continue, are eligible for CAPDA without a deductible; (3) the CAP-DA waiver provision in 42 U.S.C. § 1396n(c) 

does not contain any “language waiving the requirement in § 1396a(m) to use ‘family 

size’ budgeting”; (4) DHHS’s own budgeting rules which state that “the income of a 

spouse cannot be counted in determining the CAP-DA applicant’s Medicaid 

eligibility” do not apply to “Categorically Needy” Medicaid recipients and are 

inconsistent with the 17 March 2016 order; and (5) petitioner fully exhausted his 

administrative remedies previously and he should not be required to do so again now

because the superior court has sole jurisdiction to enforce its own order and

exhaustion would be an inadequate or futile remedy. 

DHHS responded to petitioner’s arguments by asserting that the motion and 

petition should be dismissed on the following grounds: (1) the superior court’s 17 

March 2016 order “does not apply because it only contemplated Petitioner’s eligibility 

for State Plan services and does not address Petitioner’s Medicaid eligibility through 

the CAP/DA waiver,” which is governed by separate federal rules and regulations; (2) 

petitioner remains eligible for State Plan Medicaid benefits and therefore DHHS did

not violate the 17 March 2016 order; (3) petitioner failed to exhaust his available 

administrative remedies; and (4) petitioner has failed to demonstrate how exhaustion 
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of his administrative remedies would be futile when the administrative remedy

provides “relief more or less commensurate with the claim.” Huang v. N.C. State. 

Univ., 107 N.C. App. 710, 715, 421 S.E.2d 812, 815 (1992).

The superior court dismissed petitioner’s motion in the cause to enforce the

court’s order and his petition for writ of mandamus on 21 April 2017. In so doing, the 

court found that DHHS “has not violated the Order signed on March 17, 2016.” The 

court reached this decision for the following reasons:

6. According to 42 U.S.C. § 1396n(c)(3), DHHS is 

allowed to waive the State Plan requirements for income 

and resource rules under 42 U.S.C. § 1396a(m) that the 

Court considered in the March 17, 2016 Order.

7. DHHS does not consider the “size of the family 

involved” when determining an individual’s deductible 

under the CAP/DA waiver.

8. Therefore, the Order signed on March 17, 2016 does 

not apply to Petitioner’s Medicaid eligibility under the 

CAP/DA waiver.

9. Petitioner must resort to the administrative process 

governed by N.C.G.S. § 108A-79 to appeal the February 14, 

2017 decision issued by the Mecklenburg County DSS.

Following this last order, Julissa Pachas filed a motion on 9 May 2017 to substitute 

herself as petitioner in the case because Carlos died on 17 April. After being 

substituted as petitioner, Julissa Pachas appealed the superior court’s 21 April 2017 

order to the North Carolina Court of Appeals, where she presented the issue of 

whether “42 U.S.C. § 1396a(m) require[s] respondent/appellee DHHS to determine 
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eligibility for Medicaid for the aged, blind and disabled in North Carolina based on a 

‘family of the size involved,’ regardless of what Medicaid services the aged, blind or 

disabled person requests or receives.” 

The Court of Appeals majority affirmed the 21 April 2017 order of the Superior 

Court in Mecklenburg County dismissing petitioner’s motion and petition based on 

its conclusion that the trial court lacked jurisdiction. Pachas, ___ N.C. App. at ___, 

814 S.E.2d at 140. The Court of Appeals reached this decision for two reasons. First, 

in relying on a previous decision from our Court, the Court of Appeals concluded that 

“[t]he scope of this waiver provision [under 42 U.S.C. § 1396n(c)], and whether the 

State in fact applied for and received a waiver of the income limits provision, involve 

facts and legal questions that were not ‘actually presented and necessarily involved’ 

in the trial court’s [17 March 2016] order addressing traditional Medicaid coverage.” 

Id. at ___, 814 S.E.2d at 139 (quoting Tenn.-Carolina Transp., Inc. v. Strick Corp., 

286 N.C. 235, 239, 210 S.E.2d 181, 183 (1974)). Specifically, the Court of Appeals 

majority reasoned that: 

Here, the trial court properly concluded that the 

agency’s determination of Pachas’s CAP/DA program 

eligibility involved different facts and legal issues than the 

traditional Medicaid benefits at issue in its first order. As 

the trial court observed, its first order instructed the State 

to “reinstate Petitioner’s Medicaid eligibility through the

North Carolina Medicaid State Plan pursuant to the 

controlling federal statutory provision, 42 U.S.C. § 

1396a(m).” 
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Id. at ___, 814 S.E.2d at 139. The Court of Appeals majority determined that the 

introduction of these different facts and issues deprived the trial court of the 

supervisory authority and jurisdiction that it generally maintains under Rule 70 of 

the North Carolina Rules of Civil Procedure to ensure that an agency complies with 

the court’s order. Id. at ___, 814 S.E.2d at 139-40. As a result, the majority concluded

that “[t]he trial court lacks jurisdiction to review the legal and factual issues raised 

in this appeal until they reach the court through exhaustion of the administrative 

review process and a petition for judicial review.” Id. at ___, 814 S.E.2d at 140. 

Second, the Court of Appeals majority concluded that the trial court did not 

have jurisdiction over petitioner’s motion and petition because petitioner could not 

demonstrate that the administrative review process was “futile” or “inadequate.” Id.

at ___, 814 S.E.2d at 140. Specifically, the majority reasoned that “[a]lthough the 

agency seems convinced of its legal position, that does not make the administrative 

review process ‘futile’ or ‘inadequate’ as those terms are defined by law.” Id. at ___, 

814 S.E.2d at 140 (citing Huang, 107 N.C. App. at 715, 421 S.E.2d at 815-16). 

Presumably as a result of its holding that the trial court did not have 

jurisdiction over petitioner’s motion and petition, the Court of Appeals majority did 

not announce a holding with regard to the ultimate issue that petitioner presented 

on appeal: “Does 42 U.S.C. § 1396a(m) require respondent/appellee DHHS to 

determine eligibility for Medicaid for the aged, blind and disabled in North Carolina 

based on a ‘family of the size involved,’ regardless of what Medicaid services the aged, 
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blind or disabled person requests or receives?” Id. at ___, 814 S.E.2d at 140 (affirming 

the trial court’s dismissal of petitioner’s motion and petition only because the trial 

court lacked jurisdiction). 

The dissenting judge at the Court of Appeals disagreed with the majority’s 

decision that the trial court did not have jurisdiction over petitioner’s motion and 

petition and that petitioner would have to exhaust his administrative remedies before 

seeking judicial review. Id. at ___, 814 S.E.2d at 140 (Hunter Jr., J., dissenting). The 

dissenting judge concluded that the trial court did have jurisdiction over petitioner’s

motion and petition for two reasons. First, the dissenting judge noted that “Pachas 

is correct that it is well settled the ‘exhaustion requirement may be excused if the 

administrative remedy would be futile or inadequate.’ ” Id. at ___, 814 S.E.2d at 145 

(quoting Justice for Animals, Inc. v. Robeson County., 164 N.C. App. 366, 372, 595 

S.E.2d 773, 777 (2004)). The dissenting judge reasoned that petitioner’s

administrative remedy here would be futile and inadequate because:

Given the tragic history of Pachas, I cannot vote to 

place him, or others similarly situated, back in the hands 

of the Medicaid bureaucracy, which has already denied 

benefits on the identical question of family size and its 

relation to required deductibles for Medicaid coverage. In 

my view, it is particularly telling that in the first case, the 

law of his case was based upon the conclusion that the 

State had made an error of law in denying him benefits. To 

tell a dying indigent that he or his family must endure 

another round of “administrative remedies”, when the 

Medicaid authorities moved him from one program to 

another for their own cost benefits, and when the issue is a 

matter of law, which had been previously adjudicated, is 
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simply unjust and wrong. Under the specific facts of this 

case, I would hold requiring the dying indigent to exhaust 

his administrative remedies would be futile.

Id. at ___, 814 S.E.2d at 145. 

Second, the dissenting judge reasoned that the trial court had jurisdiction over 

petitioner’s motion and petition because although N.C.G.S. § 108A-79 provides an 

administrative “remedy for individuals who wish to challenge the termination of their 

Medicaid coverage,” petitioner here “is not simply challenging the Medicaid coverage 

termination, but, rather, the violation of the trial court’s 17 March 2016 order 

requiring DHHS to apply his family size to income considerations. Specifically, this 

is an appeal for enforcement.” Id. at ___, 814 S.E.2d at 145. The dissenting judge 

added that “[a] trial court’s authority encompasses the power to enforce its own 

judgments.” Id. at ___, 814 S.E.2d at 145 (first citing Sturgill v. Sturgill, 49 N.C. 

App. 580, 587, 272 S.E.2d 423, 428-29 (1980); and then citing Parker v. Parker, 13 

N.C. App. 616, 618, 186 S.E.2d 607, 608 (1972)). 

Petitioner filed his notice of appeal based on the dissent in the Court of Appeals 

presenting the following issue: “Did the Court of Appeals majority err as a matter of 

law in ruling that the superior court lacked jurisdiction to decide whether its previous 

order was violated because petitioner failed to exhaust administrative remedies 

before moving to enforce the court’s order?” 

II. Analysis
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We conclude that the Court of Appeals did err in ruling that the superior court 

lacked jurisdiction to decide whether DHHS violated the 17 March 2016 order. 

Because we so conclude, we vacate the decision of the Court of Appeals affirming the 

trial court’s dismissal of petitioner’s motion and petition on that basis. We also 

remand this case to the Court of Appeals to address the merits of whether the 

superior court erred in determining that DHHS did not violate the 17 March 2016 

order because DHHS allegedly obtained a waiver of the requirements of 42 U.S.C. § 

1396a(m) in compliance with 42 U.S.C. § 1396n(c). Because we conclude that the trial 

court had jurisdiction over petitioner’s motion and petition, we need not determine

whether exhaustion of administrative remedies was inadequate or futile in this case.

The Court of Appeals erred in concluding that the trial court did not have 

jurisdiction over petitioner’s motion and petition because: (1) trial courts have 

jurisdiction to find new facts and determine whether a party has been “disobedient” 

under a court order requiring the party to perform a “specific act,” N.C. R. Civ. P. 70, 

and (2) the Court of Appeals relied on an inapposite case from our Court to conclude

that, because the issue of petitioner’s CAP-DA eligibility involved “facts and legal 

questions that were not ‘actually presented and necessarily involved’ ” in the 17 

March 2016 order, Pachas, ___ N.C. App. at ___, 814 S.E.2d at 139 (majority opinion)

(quoting Tenn.-Carolina Transp., 286 N.C. at 239, 210 S.E.2d at 183), the trial court 

did not have jurisdiction over the matter. 
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This Court reviews a decision of the Court of Appeals to determine whether it 

contains any errors of law. N.C. R. App. P. 16(a); State v. Mumford, 364 N.C. 394, 

398, 699 S.E.2d 911, 914 (2010); see also State v. Brooks, 337 N.C. 132, 149, 446 S.E.2d 

579, 590 (1994) (explaining that this is the standard of review of a determination by 

the Court of Appeals whether the case is before us “by appeal of right or discretionary 

review” (first citing State v. Colson, 274 N.C. 295, 163 S.E.2d 376 (1968), cert. denied,

393 U.S. 1087, 89 S. Ct. 876, 21 L. Ed. 2d 780 (1969); then citing State v. Williams, 

274 N.C. 328, 163 S.E.2d 353 (1968); and then citing N.C. R. App. P. 16(a)(1994))). 

A. The trial court had jurisdiction under the North Carolina Rules of 

Civil Procedure (Rule 70) to find new facts and determine whether 

DHHS disobeyed the 17 March 2016 order. 

It is well settled that, consistent with their inherent authority to enforce their 

own orders, North Carolina trial courts have jurisdiction to find new facts and 

determine whether a party has been “disobedient” under a previous order that 

required the party to perform a “specific act.” N.C. R. Civ. P. 70. Since 1967 the 

Rules of Civil Procedure have provided in part:

If a judgment directs a party to execute a conveyance 

of land or to deliver deeds or other documents or to perform 

any other specific act and the party fails to comply within 

the time specified, the judge may direct the act to be done 

at the cost of the disobedient party by some other person 

appointed by the judge and the act when so done has like 

effect as if done by the party. On application of the party 

entitled to performance, the clerk shall issue a writ of 

attachment or sequestration against the property of the 
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disobedient party to compel obedience to the judgment. 

The judge may also in proper cases adjudge the party in 

contempt.

N.C. R. Civ. P. 70.

Here it appears that DHHS’s decision to cancel petitioner’s Medicaid benefits 

under the CAP-DA program and require him to pay a deductible to regain eligibility 

invoked the trial court’s power to enforce its 17 March 2016 order.3 In that order the 

superior court instructed DHHS “to promptly reinstate Medicaid benefits to 

Petitioner . . . and to continue providing Medicaid to Petitioner until determined 

ineligible under the rules as modified according to this decision.” The rules as 

modified by the order required that petitioner be considered eligible for Medicaid 

under the Categorically Needy category so long as his income did not exceed one 

hundred percent of the federal poverty level based on a family of six while he was 

providing more one-half of their financial support. 

It appears, according to DHHS’s own Adult Medicaid Manual and without 

considering any effect of the waiver that DHHS allegedly obtained, that petitioner—

having been determined to fit within the Categorically Needy eligibility group and to 

be entitled to continued Medicaid benefits under the 17 March 2016 order—should 

have seamlessly qualified on 14 February 2017 for Medicaid’s CAP-DA program

without a deductible. Specifically, even DHHS’s waiver application pursuant to 42 

 

3 We do not express an opinion on the merits of the waiver issue we are remanding 

to the Court of Appeals. 
PACHAS V. N.C. DEP’T OF HEALTH & HUMAN SERVS.

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U.S.C. § 1396n(c) lists “Categorically Needy” individuals as a Medicaid-eligible group

that will be served by the CAP-DA program. Furthermore, DHHS’s own manual 

provides that DHHS will “[d]etermine eligibility [for CAP-DA] according to 

requirements for the appropriate aid program/category.” Medicaid Eligibility Unit, 

Div. of Med. Assistance, N.C. Dep’t of Health & Human Servs., Aged, Blind and 

Disabled Medicaid Manual, MA-2280 ¶ III.A.a.(2) (Oct. 1, 2012) titled “Medicaid 

Eligibility and CAP Eligibility.” Moreover, DHHS’s manual states that “[w]hen 

Medicaid eligibility can be established regardless of eligibility for CAP,” DHHS will 

“not wait for CAP approval” and it will “[a]uthorize [CAP-DA], if appropriate, as for 

any other applicant.” Id. MA-2280 ¶ III.A.a.2(c)(1)-(2). Additionally, DHHS’s own 

manual indicates that “Categorically Needy” Medicaid recipients will not be charged 

a deductible. See id. MA-2360 ¶ I (Nov. 1, 2011) (providing that the deductible 

requirement is only to be applied to Medically Needy Medicaid recipients and “[t]he 

policy in this section may not be used to find a client eligible in MAABD Categorically 

Needy – No Money Payment (N) Classification . . . . Deductible does not apply in these 

coverage’s [sic]”). We conclude that—because the 17 March 2016 order determined 

that petitioner was to continue receiving Medicaid benefits under the “Categorically 

Needy” eligibility group until he was determined to be ineligible under the rules as 

modified by that order—DHHS’s decision to terminate petitioner’s Medicaid benefits 

under the CAP-DA program on 14 February 2017 and require him to meet a 

deductible before he could regain his benefits squarely raises the issue of whether 
PACHAS V. N.C. DEP’T OF HEALTH & HUMAN SERVS.

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DHHS acted as a “disobedient party” under the 17 March 2016 order. N.C. R. Civ. P. 

70. 

DHHS contends that it did not disobey the 17 March 2016 order, and that the 

trial court did not have jurisdiction to enforce that order, because the waiver that it 

allegedly obtained under 42 U.S.C. § 1396n(c) allowed it to create different eligibility 

rules for the CAP-DA program. Without reaching any conclusions as to the merits of 

this argument, we hold that the trial court, in accord with its jurisdiction to find new 

facts and determine whether a party has been “disobedient” under a previous order

directing the party to perform a “specific act,” was authorized to determine the precise 

issue of whether the waiver that DHHS allegedly obtained under 42 U.S.C. § 1396n(c) 

allowed the agency to comply with the 17 March 2016 order while terminating 

petitioner’s Medicaid benefits under the CAP-DA program on 14 February 2017 and 

requiring him to pay a deductible before qualifying again for Medicaid. 

Our conclusion that the trial court had authority to determine that issue is

further supported by the Administrative Procedure Act (the Act) itself. The language 

of the Act suggests that the General Assembly contemplated that trial courts would 

have such jurisdiction to enforce their own court orders against disobedient agencies 

upon motion from a party in the case. Specifically, the Act provides that “[n]othing 

in this Chapter shall prevent any party or person aggrieved from invoking any 

judicial remedy available to the party or person aggrieved under the law to test the 

validity of any administrative action not made reviewable under this Article.” 
PACHAS V. N.C. DEP’T OF HEALTH & HUMAN SERVS.

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N.C.G.S. § 150B-43 (2017) (emphases added).

Here the relevant judicial remedy available to petitioner under the law is

enforcement of the trial court’s 17 March 2016 order. Neither the Act, nor N.C.G.S. 

§ 108A-79 which governs public assistance and social services appeals, provide for 

administrative review of DHHS’s alleged violation of the 17 March 2016 order. See 

id. § 108A-79 (2017) (making no mention that the agency appeals process will 

consider whether the agency violated a court order during either the local appeal 

hearing, or the hearing before DHHS, or when rendering the final agency decision);

see also id. § 108A-79(k) (2017) (stating that the judicial review at the superior court 

“shall be conducted according to the provisions of Article 4, Chapter 150B, of the 

North Carolina General Statutes”); see also id. § 150B-51(b)(1)-(6) (2017) (not 

including violation of a court order as grounds upon which a trial court can “reverse 

or modify” a final decision of the agency); but see id. § 150B-51(d) (2017) (allowing a 

trial court to enter certain orders when it reviews “a final [agency] decision allowing 

judgment on the pleadings or summary judgment”).

Because the trial court had jurisdiction to find new facts in order to determine 

whether DHHS was a disobedient party under its 17 March 2016 order, we conclude 

that the Court of Appeals erred in holding that the trial court no longer had 

jurisdiction over the case given the new factual and legal issues regarding the effect 

of DHHS’s alleged waiver under 42 U.S.C. § 1396n(c). 
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B. The Court of Appeals relied on inapposite authority in limiting the 

trial court’s jurisdiction under the North Carolina Rules of Civil 

Procedure (Rule 70). 

The Court of Appeals majority relied on our decision in Tennessee-Carolina 

Transportation, Inc. v. Strick Corp. for the principle that a “trial court’s authority 

[under the North Carolina Rules of Civil Procedure (Rule 70)] to supervise the 

agency’s actions extends only to issues ‘actually presented and necessarily involved 

in determining the case.’ ” Pachas, ___ N.C. App. at ___, 814 S.E.2d at 139 (quoting

Tenn.-Carolina Transp., 286 N.C. at 239, 210 S.E.2d at 183). The Court of Appeals

majority then stated, “In other words, the trial court’s continuing jurisdiction applies 

to issues involving ‘the same facts and the same questions, which were determined 

in the previous appeal.’ ” Id. at ___, 814 S.E.2d at 139 (emphasis added) (quoting 

Tenn.-Carolina Transp., 286 N.C. at 239, 210 S.E.2d at 183)). 

The Court of Appeals majority then applied the above principle to the facts 

here and concluded that the trial court did not have jurisdiction over petitioner’s

motion and petition, and that petitioner would have to exhaust his administrative 

remedies, because “[t]he scope of [the 42 U.S.C. § 1396n(c)] waiver provision, and 

whether the State in fact applied for and received a waiver of the income limits 

provision, involve facts and legal questions that were not ‘actually presented and 

necessarily involved’ in the trial court's order addressing traditional Medicaid 
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coverage.” Id. at ___, 814 S.E.2d at 139 (quoting Tenn.-Carolina Transp., 286 N.C. at 

239, 210 S.E.2d at 183).

We conclude that the Court of Appeals erred in relying on Tennessee-Carolina 

Transportation for the proposition that a trial court’s jurisdiction under the North 

Carolina Rules of Civil Procedure (Rule 70) to ensure that an agency complies with 

the court’s order necessarily ends when new facts and legal issues arise that were not 

“actually presented and necessarily involved” in the previous order. Id. at ___, 814 

S.E.2d at 139 (quoting Tenn.-Carolina Transp., 286 N.C. at 239, 210 S.E.2d at 183). 

The Tennessee-Carolina Transportation case involved application of the “law of the 

case” doctrine; it did not involve a motion to enforce a court order as we have here. 

See Tenn.-Carolina Transp., 286 N.C. at 238-39, 210 S.E.2d at 183-84). The issue in 

Tennessee-Carolina Transportation was whether a decision we made in a former 

appeal in that case, in which we determined that Pennsylvania law governed the 

action, continued to apply. See id. at 238-39, 210 S.E.2d at 183-84. We concluded 

that the decision in the former appeal did continue to govern the case because “[t]he 

decision by the Supreme Court on a prior appeal constitutes the law of the case, both 

in subsequent proceedings in the trial court and on a subsequent appeal.” Id. at 239, 

210 S.E.2d at 183. The full passage from Tennessee-Carolina Transportation which 

the Court of Appeals majority quotes only in part as authority for its rule, reads as 

follows:
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As a general rule, when an appellate court passes on 

questions and remands the case for further proceedings to 

the trial court, the questions therein actually presented 

and necessarily involved in determining the case, and the 

decision on those questions become the law of the case, both 

in subsequent proceedings in the trial court and on a 

subsequent appeal, provided the same facts and the same 

questions, which were determined in the previous appeal, 

are involved in the second appeal. 

Id. at 239, 210 S.E.2d at 183 (emphases added) (quoting Collins v. Simms, 257 N.C. 

1, 11, 125 S.E.2d 298, 305 (1962) (Parker, J., concurring in the result)); see also 

Pachas, ___ N.C. App. at ___, 814 S.E.2d at 139. Because Tennessee-Carolina 

Transportation involved the doctrine of the law of the case—and did not involve a 

motion to enforce a court order, which is the issue here—the Court of Appeals

majority erred in relying on that case to limit the scope of the trial court’s jurisdiction 

under the North Carolina Rules of Civil Procedure (Rule 70).

III. Conclusion

We vacate the Court of Appeals’ decision concluding that the trial court did not 

have jurisdiction to consider whether DHHS violated the trial court’s previous order. 

Accordingly, we remand to the Court of Appeals to address DHHS’s argument that 

the agency did not violate the 17 March 2016 order because it allegedly obtained a

waiver under 42 U.S.C. § 1396n(c), permitting it to create its own rules for CAP-DA 

eligibility apart from the requirements of 42 U.S.C. § 1396a(m). Because we conclude 

that the trial court had jurisdiction over petitioner’s motion and petition, we need not 
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Opinion of the Court

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determine whether exhaustion of administrative remedies was inadequate or futile 

here.

VACATED AND REMANDED.

Justice EARLS did not participate in the consideration or decision of this case.