For the purposes of this chapter, unless the
context clearly indicates a different meaning, the following words
and phrases shall have the meanings set forth:
INSURANCE
Coverage afforded by insurance policies of every kind, whether
the premiums are paid by the Township, the municipal official or someone
on his behalf.
MUNICIPAL OFFICIAL
Any officer, employee, board or committee member appointed
or hired by the Mayor or Township Committee, whether full- or part-time.
The term shall also include any person elected by the voters of the
Township to fill any official position in the Township or any person
subsequently appointed to fill such position.
Subject to the provisions of this chapter, the
Township of Stillwater shall reimburse a municipal official for all
expenses incurred (specifically including reasonable attorney fees
and court costs) and all monetary judgments imposed upon him 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 Committee, 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 Township of Stillwater against the municipal official.
D. Where the legal proceeding involves a question concerning
the election laws.
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 any counteraction against the person
or persons bringing the action against him.
A municipal official shall not be entitled to
indemnification or reimbursement pursuant to this chapter unless,
within 10 calendar days of the time he is served with any summons,
complaint, process, notice, demand or pleading, he delivers the original
or a copy thereof to the Township Attorney. The municipal official
shall be obliged to cooperate with 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 legal proceeding is terminated by an
agreement among the parties, then the Township shall not be obligated
to reimburse the municipal official unless the Township approves the
settlement agreement.
If the municipal official files a counteraction
in the legal proceedings, the Township shall not be obligated to reimburse
him for any attorney fees or court costs attributable to such counteraction.
The Township may reimburse a municipal official
for a portion of the 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.
This chapter shall take effect upon final passage
and publication according to law. Any legal action 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 the chapter.