City of Englewood, NJ Article XV Defense and Indemnification

[Added 7-29-2014 by Ord. No. 14-27]

§ 3-64 Definitions.

As used in this article, the following terms shall have the meaning indicated:

PUBLIC EMPLOYEE

Any current or former elected or appointed official, officer or member of the boards, agencies and commissions of the City, or employee, whether compensated or not, whether full-time or part-time, who is or was authorized by the City to perform any acts or services; provided, however, that this term does not include an independent contractor.

§ 3-65 Defense of actions.

The City shall provide for the defense of any civil actions brought against a public employee arising out of any act or omission directly related to the lawful exercise of that person's authority in the furtherance of his or her official duties, and this obligation shall extend to any cross-action, counterclaim or cross-complaint against such employee.

§ 3-66 Exceptions.

The provisions of this article shall not be applicable when the City Council determines that:

A. The act or omission was not directly related to the lawful exercise of that person's authority in the furtherance of his or her official duties.

B. The act or failure to act was because of actual fraud, willful misconduct or actual malice.

C. The defense of the action or proceeding is provided for by an insurance policy or policies, whether obtained by the City or by any other person.

D. The public employee failed to deliver to the City, within 10 calendar days after the time he or she was served with the summons, complaint, process, notice, demand or pleading, the original or a copy of the same.

E. The public employee has failed to cooperate fully with the defense.

F. The action is a disciplinary proceeding instituted against the employee by the City or is a criminal proceeding instituted as a result of a complaint on behalf of the City; provided, however, that reimbursement for the expenses of the defense of such actions may be required under certain circumstances as required by law.

§ 3-67 Methods of providing defense.

The City may provide any defense required of it under this article through the City Attorney or through the retention of another attorney. The cost of retention of an outside attorney shall be provided when the defense of the action or proceeding creates a conflict of interest between the City and the public employee.

A. When the City provides any defense required of it under this article through the City Attorney, the City may assume exclusive control over the representation of the public employee, and such employee shall cooperate fully with the defense.

B. The City Council may approve the retention of an outside attorney in accordance with the following conditions:

(1) The employee does not have the right to an attorney of his or her choice at City expense. However, the City Council may approve of any attorney requested by the employee.

(2) The attorney retained by the City shall provide a written retainer agreement and shall submit a certification of services rendered prior to payment.

(3) Nothing in this article shall prevent an employee from retaining an attorney of the employee's choice at his or her own expense, without reimbursement from the City.

C. City Attorney responsibilities; possible conflicts.

(1) When the outside attorney is retained, the City Attorney shall be directly involved with the public employee's attorney concerning any recommendation for settlement of a civil lawsuit. The City Attorney shall then present any recommendation of settlement, which must be in the best interest the City, to the City Council for its approval.

(2) Where a possible conflict exists between the City and the public employee acting within the scope of his official City duties, and where both are named as parties in the same civil lawsuit, the City Attorney may decline any involvement in the matter.

(3) In circumstances involving litigation or other legal proceedings between two public employees qualifying for the privileges granted herein, the City Attorney will not be required to represent or otherwise participate on behalf of either party.

§ 3-68 Indemnification.

A. In any case where the City is required to provide a defense or where the employee is entitled to defense reimbursement under this article, the City shall pay or shall reimburse the public employee for:

(1) Any bona fide settlement agreements entered into by the employee, provided that the procedures set out in this article have been complied with.

(2) Any judgment entered against the employee.

B. In addition, in any case where the City would be required to provide a defense under this article, except for the fact that such defense is provided for by insurance, the City shall provide indemnification as aforesaid, but only to the extent not covered by insurance. Nothing in this article shall authorize the City to pay for punitive or exemplary damages or damages resulting from the commission of a crime, except that the City may indemnify an employee for exemplary or punitive damages resulting from the employee's civil violation of state or federal law if, in the opinion of the City Council, the acts committed by the employee upon which the damages are based did not constitute actual fraud, actual malice, willful misconduct or intentional wrong.

§ 3-69 Reimbursement back to City required.

If, pursuant to the terms of this article or any other applicable law, the City has paid any legal fees, defense costs, or damages on account of a City official and it is later determined that the payment of same was improper or was disallowed under the terms of this article or any law, then the City official shall within 30 days of the receipt of the City's demand reimburse to the City the full amount of the improper or disallowed payments made by the City.