Pursuant to the provisions of N.J.S.A. 59:10-1 et seq. and subject to
the provisions of this chapter, the Borough of Franklin is authorized to provide
for the defense of actions brought against its municipal officials and shall
indemnify such officials to the extent permissible by law and hereinafter
set forth and shall save harmless and protect such persons from financial
loss resulting from litigation. Such indemnification shall arise out of any
action or legal proceeding of a noncriminal nature directly related or incidental
to the performance of the duties of the position or office held by such municipal
official. The Borough of Franklin 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 Council of the Borough of Franklin,
the acts committed by the employee upon which damages are based did not constitute
actual fraud, actual malice, willful misconduct or an intentional wrong.
The municipal official shall not be entitled to indemnification or reimbursement
pursuant to this chapter unless within 10 calendar days of the time such official
is served with any summons, complaint, process, notice, demand or pleading,
the official delivers the original or a copy thereof to the Borough Attorney.
The municipal official shall be obliged to cooperate with the borough in the
conduct of the official's defense. Whenever competent and disinterested legal
counsel is available to the borough through any insurance coverage, the municipal
official shall be obliged to be represented by such counsel. If the borough
wished to use the Borough Attorney or the attorney for any board or committee
of the borough to defend that action, the municipal official shall be obliged
to be represented by that attorney unless there is a conflict of interest.
The refusal of the municipal official to cooperate with the borough shall
terminate the borough's obligation to reimburse the municipal official.
The amount the borough is obliged to reimburse the municipal official
shall be reduced by any insurance coverage payable to the municipal official
by the net amount (that is, any recovery less attorneys' fees, disbursements
and court costs) of any money received by the municipal official in any counteraction
against the person or persons bringing the action against him.
If the legal proceeding is terminated by an agreement among or between
the parties, then the borough shall not be obligated to reimburse the municipal
official unless the borough approves the settlement agreement.
If the municipal official files a counteraction in the legal proceedings,
the borough shall not be obligated to reimburse for any attorney fees or court
costs attributable to such counteraction.
The obligation of the borough to reimburse a municipal official for
expenses shall arise upon final determination of the legal proceedings. In
its discretion, the borough may reimburse a municipal official for a portion
of expenses incurred prior to a final decision.
To the extent that N.J.S.A. 40A:14-155 provides broad indemnification
to members of the Borough of Franklin Police Department, that statute shall
supersede this chapter.
This chapter shall take effect upon final passage and publication according
to law. Any legal proceeding which may be covered by this chapter which has
not been reduced to a final judgment as of the date of passage shall be covered
by the terms of this chapter.