City of East Orange, NJ
Essex County
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Table of Contents
Table of Contents
[HISTORY: Adopted by the City Council of the City of East Orange 3-14-1988 by Ord. No. 9-1988; amended in its entirety 8-16-2010 by Ord. No. 11-2010. Subsequent amendments noted where applicable.]
GENERAL REFERENCES
Administrative organization — See Ch. 5.
Insurance Fund Commission — See Ch. 14A, Art. XIV.
Court — See Ch. 21.
Personnel policies — See Ch. 60.

§ 23-1 Policy.

Whenever a civil or criminal action is instituted against any current or former appointed or elected City official, employee or servant, whether or not compensated or hired on a part-time basis, who is authorized to perform any act or service on behalf of the City or any individual subject to N.J.S.A. 40A:9-134.1, 40A:14-155 and 40A:14-128 (hereinafter "employee"), for any act or omission arising out of and in the course of and within the scope of the performance of the duties of such office, the City shall defray the cost of defending such action as set forth below:
A. 
In a civil matter if instituted against an employee based upon an act or omission of that employee, the City's obligation hereunder shall be limited to those cases in which:
(1) 
The employee was acting in a matter in which the City had an interest;
(2) 
The employee was acting in the discharge of a duty imposed or authorized by law in furtherance of the employee's official duties;
(3) 
The employee was acting in good faith;
(4) 
The employee is a named defendant in a matter pending before a court of competent jurisdiction or other legal proceeding; and
(5) 
The civil proceeding is dismissed or results in a final disposition without a specific finding of illegal wrongdoing or malfeasance in office by the employee.
B. 
In a criminal matter if instituted against an employee based upon an act or omission of that employee, the City's obligation shall be limited to those cases in which:
(1) 
The employee was acting in a matter in which the City had an interest;
(2) 
The employee was acting in the discharge of a duty imposed or authorized by law in furtherance of the employee's official duties;
(3) 
The employee was acting in good faith;
(4) 
The employee is a named defendant in a matter pending before a court of competent jurisdiction or other legal proceeding; and
(5) 
The criminal proceeding is dismissed or results in a final disposition in favor of the employee.
C. 
Employees shall not be reimbursed for legal fees pursuant to this chapter in civil or criminal actions where the City is a plaintiff, pursues disciplinary action or otherwise initiates the action against the employee, unless required by statute or court order.
D. 
The City's defrayal of the employee's costs of defending legal actions shall not include any post-judgment appellate actions involving the employee unless, in the opinion of the Corporation Counsel, it is in the best interests of the City to pursue an appeal.
E. 
The City of East Orange 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 and the Mayor, upon consultation with Corporation Counsel, the acts committed by the employee upon which damages are based did not constitute actual fraud, actual malice, willful misconduct or an intentional wrong.
F. 
The defense and indemnification provisions of § 23-1 shall not be applicable when the Mayor and City Council, upon consultation with Corporation Counsel, determine that:
(1) 
The act or omission was not within the scope of employment; or
(2) 
The employee failed to deliver to the Corporation Counsel, within 10 calendar days after the time he is served with any summons, complaint, process, notice, demand or pleading, the original or a copy of the same unless excepted by the Corporation Counsel; or
(3) 
The employee has failed to cooperate fully with the defense of the proceeding; or
(4) 
A court of competent jurisdiction has determined that the act or omission was not within the scope of employment.
G. 
Nothing contained in this chapter shall inure to the benefit of any insurance company which has issued a policy of liability insurance or to any person or entity who is obligated to indemnify the City or an employee.

§ 23-2 Procedure.

A. 
An employee who seeks reimbursement from the City for the costs of defending any civil or criminal proceedings shall deliver the complaint or the indictment to the Corporation Counsel within 10 days of the time he is served with a complaint or indictment.
(1) 
In civil matters, the employee will be entitled to reimbursement for his legal defense pursuant to § 23-1A of this chapter.
(2) 
In criminal matters, the employee will be entitled to reimbursement for his legal defense pursuant to § 23-1B of this chapter upon the successful termination of the criminal proceedings.
(3) 
The employee who seeks reimbursement should retain his personal attorney with the knowledge that he may or may not be subsequently reimbursed by the City and that, if the employee is reimbursed, it will be in an amount within the limits set out in § 23-3, even if the attorney's fees to be paid by the employee or costs incidental to the representation are greater than that amount. The City, under no circumstances, will be liable to any private attorney at any time; rather the City will directly reimburse the employee in the amount set forth in § 23-3.
B. 
In all civil or criminal proceedings, an employee will be barred from any reimbursement by the City if he does not obtain a written retainer agreement in which the attorney certifies to keep accurate and complete records of the hours which the attorney spends on the legal proceedings (to include the date and nature of services performed with regard to all times, kept in tenths of an hour) from the outset of the case and to submit an affidavit of service at the conclusion of the proceedings setting out that detailed time information.
C. 
The costs incidental to the defense of an employee shall be reasonable in nature, and Corporation Counsel shall be noticed prior to incurring the service. Whenever possible, these costs shall be set out with specificity in the written retainer agreement.
D. 
The employee, within 10 days after retaining an attorney, shall forward a signed copy of said retainer agreement to the Corporation Counsel. An employee who wishes to seek reimbursement of his legal expenses in a civil or criminal proceeding shall notify the Corporation Counsel within 20 days of the termination of that proceeding. Said employee shall then submit the attorney's affidavit of service signed by his attorney.

§ 23-3 Attorney reimbursement rate.

If the employee is entitled to reimbursement as set forth in §§ 23-1 and 23-2 of this chapter, attorney's fees shall be reimbursed at a rate set periodically by resolution of City Council. Costs incidental to the representation may be approved on an individual basis.

§ 23-4 Responsibility of Corporation Counsel.

A. 
The Corporation Counsel in civil proceedings shall be directly involved with the employee's retained attorney concerning any recommendation for settlement of a civil lawsuit. The Corporation Counsel shall then present any recommendation of settlement involving municipal funds which exceeds nuisance value (defined as the bid threshold pursuant to N.J.S.A. 40A:11-3C), which must be in the best interest of the City, to the City Council for its approval.
B. 
Where a possible conflict exists between the City and the employee acting within the scope of his official City duties, and where both are named as parties in the same civil lawsuit, the Corporation Counsel shall decline to represent that person.
C. 
In circumstances involving litigation or other legal proceedings between two or more employees qualifying for the privileges granted herein, the Corporation Counsel will not be required to represent or otherwise participate on behalf of either party.
D. 
Notwithstanding any provisions of this chapter to the contrary, the Corporation Counsel in his judgment may provide for a defense pursuant to this chapter by assigning an attorney from the Office of the Corporation Counsel, employing outside counsel, utilizing counsel through the City's third-party administrator or by asserting the City's right under any appropriate insurance policy which requires the insurer to provide a defense.
E. 
Whenever the Corporation Counsel provides for the defense of an employee or former employee pursuant to this chapter, the Corporation Counsel may assume exclusive control over the representation of such employee or former employee, who shall cooperate fully with the Corporation Counsel's efforts to defend.

§ 23-5 Expenditure of funds.

Any expenditure of funds in connection with the reimbursement of counsel fees to an employee for defense of a legal proceeding or costs incidental to the representation shall be subject to approval by resolution of the City Council.