Township of Hillsborough, NJ Defense and Indemnification

The Township of Hillsborough does hereby indemnify and hold harmless the Township Engineer from any liability for damages, including but not limited to property damage, bodily injury or death, including attorney defense costs and any other loss from any third party which arises either directly or indirectly as a result of any and all professional engineering services requiring the professional sealing of documents rendered to or on behalf of the Township of Hillsborough, from the date of adoption of this article forward as well as for a period of 10 years prior thereto.

§ 31-2 Continuation after employment period.

This indemnification shall continue beyond the employment period of the Township Engineer in the event that suit is filed for any error, omission or negligent act committed by the Township Engineer in the performance of professional services as an employee of the Township of Hillsborough.

§ 31-3 Effect of private insurance.

This indemnification shall be deemed primary unless the Township Engineer has in effect, with respect to any claim made, his own professional liability policy. If such a policy is in effect, this indemnification shall be deemed secondary to the extent that coverage is afforded under the terms of that policy. In other words, the amount the Township is obliged to indemnify the Township Engineer shall be reduced by any insurance coverage payable to the Township Engineer.

§ 31-4 Limit on protection.

This indemnification shall provide protection to the Township Engineer up to a ceiling of $1,000,000 in the aggregate for any given year.

§ 31-5 Responsibilities of Engineer; representation.

The Township Engineer shall not be entitled to indemnification pursuant to this article unless, within 20 calendar days of the day he is served with any summons complaint, process, notice, demand or pleading, he delivers the original or a copy thereof to the Township Clerk. The Township Engineer shall be obliged to cooperate with the Township in the conduct of his defense. Whenever competent and disinterested counsel is available to the Township through any self or other insurance coverage, the Township Engineer shall be obliged to be represented by such counsel. If the Township wishes to use the Township Attorney to defend the action, the Township Engineer shall be obliged to be represented by that Attorney unless there is a conflict of interest. The refusal of the Township Engineer to cooperate with the Township shall terminate the Township's obligation to indemnify the Township Engineer.

§ 31-6 Exceptions.

There shall be no indemnification pursuant to this article if it is established that the Township Engineer acted or failed to act because of actual fraud, actual malice, willful misconduct or intentional wrongdoing. Nothing in this article shall authorize the Township to pay for punitive or exemplary damages or damages resulting from the commission of a crime.

Article II Municipal Officials

[Adopted 9-9-2003 by Ord. No. 2003-17]

§ 31-7 Intent.

It is the intent and purpose of this article to provide for the indemnification and defense of actions against certain public officials and employees as described herein.

§ 31-8 Definitions.

For the purposes of this article, unless the context clearly indicates a different meaning, the following words and phrases shall have the meaning set forth:

INSURANCE

Coverage afforded by insurance policies of every kind, whether the premiums be paid by the Township, the municipal official or someone on their behalf.

MUNICIPAL OFFICIAL

Any officer or official, employee, Township Committee member, or other individual hired or appointed by the Township Committee or appointed by the Mayor, whether full- or part-time. The term shall also include any person elected by the voters to fill any official position in the Township or any person subsequently appointed to fill such position. The municipal official is not, for the purposes of this article, intended to include independent contractors or expert consultants via professional or otherwise.

§ 31-9 Provisions for defense.

The Township shall provide for the defense of any action brought against the municipal official on account of any act or omission arising out of or incidental to the performance of his or her duties, and this obligation shall extend to any cross action, counterclaim, cross claim, cross complaint by third party complaint against such municipal official, unless excepted by the terms of § 31-10.

§ 31-10 Exceptions.

The Township shall not be required to provide any defense when the Township Committee determines that:

The act or omission was not within the scope or incidental to the normal course of duty of the municipal official;

The act or failure to act was the result of actual fraud, actual malice, willful misconduct or intentional wrong;

The defense of the action or proceeding is provided for by an insurance policy or policies, whether obtained by the Township or by any other person or entity;

The action has been brought by the Township itself against the municipal official, or where the action is a criminal proceeding;

The municipal official has failed to provide to the Township within 15 calendar days after the time the municipal official is served with a summons, complaint, process, notice, demand or pleading, the original a copy thereof;

The municipal official has failed to cooperate fully with the defense.

§ 31-11 Method of providing defense.

The Township may provide any defense required of it under this article to the office of the Township Attorney or by employing other counsel. The Township shall in no event be responsible for the costs of attorney's fees incurred by anyone unless it shall agree in writing to the terms of the representation.

§ 31-12 Control over litigation.

Whenever the Township provides any defense required of it under this article, the Township, through counsel, may assume exclusive control over representation of the municipal official, and such municipal official shall cooperate fully with the defense.

§ 31-13 Indemnification.

In any case where the Township is required to provide a defense under this article, the Township shall pay or shall reimburse the municipal official for the following:

(1)

Any bona fide settlement agreement entered into by the Township on behalf of the municipal official.

(2)

Any judgment entered against the municipal official.

In addition, in any case where the Township would be required to provide a defense under this article, except for the fact that such defense is provided for by insurance, either through a policy of the Township or the individual, the Township shall provide indemnification as aforesaid, only to the extent that liability exists which is not covered by insurance and not excepted by the terms of § 31-10.

In addition to the above, the Township shall indemnify municipal officials as defined herein for exemplary or punitive damages, provided that the acts committed by the municipal official upon which said damages are based do not constitute actual fraud, actual malice, willful misconduct or an intentional wrong.