[HISTORY: Adopted by the City Council of the City of Atlantic
City 9-17-2014 by Ord. No. 51-2014.[1] Amendments noted where applicable.]
[1]
Editor's Note: This ordinance also repealed former Ch. 16,
Defense and Indemnification, adopted 3-2-1988 by Ord. No. 8-1988,
as amended.
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 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 Atlantic 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 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 § 16-1 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 insure 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.
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 § 16-1A of this chapter.
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.
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 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.
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.