[HISTORY: Adopted by the Township Committee of the Township of Mendham by Ord. No. 19-1991 (Sec. 2-42 of the 1998 Revised General Ordinances). Amendments noted where applicable.]
Personnel policies — See Ch. 45.
As used in this chapter, the following terms shall have the meanings indicated:
- A. Includes the following: any past, present and future member of the governing body of the Township; any past, present and future member of any other Township board, body, commission or committee, whether created or authorized by state law or by municipal ordinance or resolution; any director, officer or employee of any nonprofit organization authorized by the Township to perform services in connection with the administration of any low- and moderate-income housing within the Township; and any other past, present and future Township Officer, official, employee or other person, whether elected or appointed, compensated or uncompensated, full-time or part-time, who by reason of position or employment has been given the authority or duty to perform any acts or services of any nature whatsoever for or on behalf of the Township in connection with any of its operations; provided, however, that the following shall not be considered Township officials for purposes of this chapter: an independent contractor; a member of officer of the Township Police Department, including a probationary officer; or any person whose defense or indemnification is the subject of statutory provisions.
- B. The inclusion of each of the aforementioned persons within the definition of the term "Township Official" is only for convenience of reference for the purposes of this chapter. Such persons may or may not be considered to be officials of the Township for other purposes.
Except as provided in § 22-3, 22-4, 22-9 or 22-11, the Township shall provide for the defense of any civil action or proceeding commenced against any Township Official covered by § 22-1 on account of any act or omission by such Township Official involving Township affairs, operations or services. The duty to defend shall extend to a cross-claim or counterclaim.
Every Township Official who is served with any summons, complaint, process, notice, demand or pleading in a civil action or proceeding involving Township affairs, operations or services shall deliver the original or a complete copy thereof to the Township Administrator within seven calendar days of the time that service is made upon such Township Official. Each document shall bear a notation as to the date upon which service was made upon the Township Official. The Township Official shall promptly furnish such additional information regarding the matter as may be requested by the Township Administrator. Failure to comply with the foregoing requirements shall constitute grounds for a refusal by the Township to provide the Township Official with a defense to any civil action or proceeding in accordance with the provisions of this section or to indemnification pursuant to § 22-6.
The Township shall not be required to provide for the defense of a civil action or proceeding against a Township Official if the Township Committee determines that it is likely that:
The act or omission was not within the scope of employment or duties;
The act or the failure to act involved actual fraud, actual malice or willful misconduct;
The act or failure to act was in violation of any applicable provision of any state or Township code of ethics;
The defense of the action or proceeding by the Township would create a conflict of interest between the Township and the Township Official; or
In the event of an action or proceeding against three or more members of the governing body, the Township Attorney may make any determination which might otherwise be made by the Township Committee in accordance with this section.
In the event that the Township shall refuse to provide for the defense of a civil action or proceeding for any of the reasons hereinabove mentioned, the Township shall cause written notice of such refusal to be given to the Township Official concerned in such manner that the notice of refusal is received within 14 calendar days after the original service upon the Township Official of the document mentioned in § 22-3.
Defense for a Township Official may be provided by the Township Attorney, or by other counsel employed by the Township for such purpose, or by an exercise of the Township's right under any appropriate insurance policy to require the insurer to provide the defense.
Whenever the Township provides for the defense of a Township Official pursuant to any provision of this chapter, the Township or the Township's insurer may assume exclusive control over the representation of such Township Official, who shall cooperate fully with the Township or the Township's insurer in all matters relating to the defense.
The Township or the Township's insurer, as the case may be, shall have the right to settle or compromise any litigation involving a defense provided for a Township Official. In the event that the Township insurance policy contains a deductible amount and the defense is provided by the insurer, the terms of the settlement shall be approved by the Township Committee, or by the Township Attorney in the event that the action or proceeding is against three or more members of the Township Committee.
The Township and/or the Township's insurer shall provide for the payment and satisfaction of any amount which may be due under any judgment against the Township Official or shall provide for the payment of any amount due by reason of the settlement of any action or proceeding, and the Township Official shall not be required to contribute to any such payment.
In the event that the Township Official has complied with the requirements of § 22-3 but the Township has refused to provide for a defense to a civil action or proceeding in accordance with the provisions of § 22-4, the Township Official shall be entitled to indemnification from the Township if the Township Official established that the act or omission upon which the claim or judgment was based occurred within the scope of employment or duties as an officer, employee or agent of the Township and the Township fails to establish that the act or omission constituted actual fraud, actual malice or willful misconduct or was in violation of any applicable provision of any state or Township code of ethics. Any indemnification shall include the amount of any judgment or the amount under any bona fide settlement agreement, as well as all costs of defending the civil action or proceeding, including reasonable counsel fees and expenses, together with the costs of appeal, if any.
The Township Committee may elect to provide for the payment or indemnification of exemplary or punitive damages assessed against a Township Official but only if in the opinion of a majority of the full membership of the Township Committee the acts committed upon which the damages are based did not constitute actual fraud, actual malice or willful misconduct.
The Township Committee may provide for the defense of a Township Official in a criminal proceeding if a majority of the full membership of the Township Committee shall determine that providing such defense is in the best interest of the Township. The Township Committee may also elect to pay any fine or penalty which may be imposed upon a Township Official for a criminal violation if in the opinion of a majority of the full membership of the Township Committee the action by the Township Official was taken in good faith for the benefit of the Township.
No provision of this chapter shall be interpreted or construed as effecting or limiting any obligation of any insurer under the terms of any insurance policy carried by the Township.
This chapter shall not apply to a member or officer, including a probationary officer, of the Township Police Department who is entitled to the benefits of the provisions of N.J.S.A. 40A:14-155, nor shall this chapter apply to any other Township Official so as to modify the rights or benefits under statutory or decisional law applicable to such Township Official.
No provision of this chapter shall apply to any action or proceeding of any nature instituted by the Township against any Township Official.