[Adopted 9-5-1989 by Ord. No. 6:50-89]
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 his behalf.
MUNICIPAL OFFICIAL
Any officer, employee, Board or Township Council member appointed or hired by the Mayor, Township Council or Township Administrator, whether full-time 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.
Subject to the provisions of this article, the municipality shall reimburse a municipal official for all expenses incurred (specifically including reasonable attorney fees and court costs) and all monetary judgments imposed upon him/her in any action or legal proceeding of a noncriminal nature arising out of or incidental to the performance of the duties of the position or office held by such municipal official. The township shall indemnify a municipal official for exemplary or punitive damages resulting from the municipal official's civil violation of state or federal law if, in the opinion of the Township Council, the acts committed by the municipal official upon which the damages are based did not constitute actual fraud, actual malice, willful misconduct or an intentional wrong.
The township shall not be obligated to provide reimbursement in the following instances:
A. 
Where the legal proceeding is instigated or brought by the municipal official.
B. 
Where the legal proceeding involves a claim of misfeasance or malfeasance in office, or a claim of fraud, theft or misappropriation of public funds, and the municipal official is found liable for the charge.
C. 
Where the legal proceeding is instigated or brought by the municipality against the municipal official.
D. 
Where the legal proceeding involves a question concerning the election laws, unless the municipal official is acting within his or her official capacity.
The amount the township is obliged to reimburse the municipal official shall be reduced by any insurance coverage payable to the municipal official by the net amount (recovery less attorney fees, disbursements and court costs) of any money received by the municipal official in a counteraction against the person or persons bringing the action against him/her.
A municipal official shall not be entitled to indemnification or reimbursement pursuant to this article unless, within 10 calendar days of the time he/she is served with any summons, complaint, process, notice, demand or pleading, he/she delivers the original or a copy thereof to the Township Attorney.
The municipal official shall be obliged to cooperate with the township in the conduct of his defense. Whenever competent and disinterested legal counsel is available to the township through any insurance coverage, the municipal official shall be obliged to be represented by such counsel. If the township wishes to use the Township Attorney or the attorney for any board or committee of the township to defend the action, the municipal official shall be obligated to be represented by that attorney unless there is a conflict of interest. The refusal of the municipal official to cooperate with the township shall terminate the township's obligation to reimburse the municipal official.
If the municipal official files a counteraction in the legal proceedings, the municipality shall not be obligated to reimburse him/her for any attorney fees or court costs attributable to such counteraction.
The township may reimburse a municipal official for a portion of expenses incurred prior to a final decision in a legal proceeding, but the township shall be entitled to wait for a final determination before being obligated to make any payments.
To the extent N.J.S.A. 40A:14-155 provides broader indemnification to members of the municipality's Police Department, that statute shall supersede this article.[1]
[1]
Editor's Note: See Ch. 41, Police Department.