Division 2 Risk Management and Assumption Plan

Occurs during the discharge of the member’s official duties for the city; and

Is within the scope of the member’s office, employment or assigned volunteer work with the city, as applicable.

Excluded action.

Any claim or suit against a plan member:

By the city;

That results from:

(A)

An intentional or knowing violation of a law (including an administrative agency rule having the force and effect of law) committed by, or with the knowledge and consent of, the plan member; or

(B)

An act of fraud committed by, or at the direction of, the plan member;

That arises while the plan member is operating a city vehicle with no authority to do so;

That asserts or alleges liability assumed by the plan member under a contract, unless the contract is entered into at the request of the city;

(5)

That includes a joinder by the plan member of a claim or suit of the plan member against the city for benefits under the plan;

(6)

For punitive damages that are not recoverable against the city in law;

(7)

For damages or other payments that the city is precluded from paying by law; or

(8)

For damages caused by intentional tort or any action outside the course and scope of a plan member’s duties.

Excluded loss.

Any of the following:

Any loss that arises out of an excluded action;

Any loss the payment of which by the city is precluded by law;

Any loss arising out of a claim or suit resulting from a covered act that occurred before the plan took effect if such claim or suit is barred by any statute of limitations;

Any loss arising out of a claim or suit resulting from a covered act that occurs while the plan is in effect if:

(A)

The plan member experiencing the loss becomes legally obligated to pay the loss after the plan is terminated; and

(B)

Such claim or suit is barred by any statute of limitations;

(5)

Any loss arising out of a claim or suit resulting from a covered act that occurs after the plan is terminated; or

(6)

Any loss covered by the municipal workers’ compensation law.

Loss.

The damages that a plan member is legally obligated to pay that arise from a claim or suit resulting from a covered act.

Loss expenses.

Any of the following:

The city’s expenses in investigating or defending a claim or suit that may result in a plan claim;

The costs taxed against a plan member in a suit that results in a plan claim and any pre-judgment or post-judgment interest for which the plan member is liable;

The reasonable expenses of a plan member incurred at the city’s request in connection with a claim or suit that may result in a plan claim; and

Any attorneys’ fees ordered by a court to be paid by a plan member in a suit that results in a plan claim.

Plan.

The city’s risk management and assumption plan, as established by this division.

Plan claim.

Any plan loss together with the plan loss expenses that result from the claim or suit giving rise to such plan loss.

Plan loss.

Any loss that is not an excluded loss.

Plan loss expense.

Any loss expenses, except those incurred in connection with an excluded action; and

Any coverage determination expenses.

Plan member.

An individual who at any time (whether before or after the establishment of the plan) is or has been:

An employee of the city;

A member of the city council;

A member of:

(A)

A city board, council or committee created by charter, ordinance or resolution of the city; or

(B)

The board of directors of any nonprofit corporation created under the authority of the city council as an instrumentality of the city; or

§ 1.08.033 Defense and settlement of claims or suits.

An individual who is a volunteer assisting the city pursuant to an official policy adopted or approved by the city council.

Program ordinance.

Ordinance No. 87/30 (which establishes the city self-insurance and risk management program), as from time to time amended (division 3 of this article).

(1996 Code, sec. 8.901; Ordinance adopting Code)

§ 1.08.032 Plan established.

The city hereby establishes the city risk management plan, which shall consist of the policies, rights and duties embodied in this division. The plan shall be implemented and administered as provided by this division.

(1996 Code, sec. 8.902)

The city will defend any suit, except an excluded action, against a plan member that results from a covered act, even if the suit is groundless or fraudulent.

The city may investigate, negotiate or settle any claim or suit against a plan member that results from a covered act, as the city determines necessary or appropriate, without consent of such plan member.

(c)

Investigation or defense by the city of a suit which is determined to be an excluded action shall not render the act which is the alleged basis of the suit or claim a covered act if the city notifies the plan member that the act might be determined to be an excluded action and advises the plan member to seek counsel.

(1996 Code, sec. 8.903)

§ 1.08.034 Payment of claims.

Subject to subsection (b) below, the city will pay each plan claim.

If a plan claim arises out of a claim or suit in which the city’s liability (or asserted liability) exists by virtue of the Texas Tort Claims Act, as amended, chapter 101, Civil Practice and Remedies Code, Vernon’s Texas Codes Annotated, whether or not the city is a defendant, the city will pay such plan claim in an amount up to, but not exceeding, the limits of liability applicable to the city provided by such statute or other applicable law.

(c)

To be entitled to payment by the city for any plan claim, a plan member must:

Notify the city secretary in writing as soon as practicable after receipt of written notice of any claim or suit that may result in a plan claim and in any event not later than three (3) working days after such receipt;

Cooperate with the risk manager in the investigation, negotiation or settlement of any claim or suit giving rise to the plan claim and enforcing any right of contribution or indemnity against an individual or organization who may be liable to the city because of the payment by the city of a plan claim;

Attend any hearing or trial held in connection with a plan claim, and assist in securing and giving evidence, and obtaining the attendance of witnesses;

Not, except upon advice of the city attorney or when questioned by a police officer at the scene of an accident, give any oral or written statement or enter into any stipulation or agreement concerning a claim or suit resulting in a plan claim;

(5)

Not, except at the plan member’s own cost, voluntarily make any payment, assume any obligation, or incur any expense with respect to any claim or suit resulting in a plan claim without the consent of the risk manager;

(6)

Deliver to the risk manager, promptly upon receipt, any demand, summons, notice or other process received by the plan member in connection with any claim or suit that may result in a plan claim;

(7)

Comply with the claims administration procedures of the risk manager; and

(8)

Perform the duties and comply with the requirements imposed on the plan member by this division or by the program ordinance (division 3 of this article).

(1996 Code, sec. 8.904)

§ 1.08.035 Legal representation.

The city will provide legal representation for a plan member in a claim or suit, except an excluded action, in which the asserted or alleged liability of the plan member results from a covered act.

If the city attorney determines that there exists a conflict of interest for the city attorney to represent a plan member pursuant to subsection (a) of this section, the city will pay the reasonable fee of a private attorney to represent the plan member. The private attorney will be selected by the risk manager or his/her designee.

(1996 Code, sec. 8.905)

§ 1.08.036 Subrogation.

If payment of a plan claim or legal representation is provided to a plan member under the plan, the city is subrogated to the plan member’s rights of recovery against any individual or organization to the extent of the city’s payment or liability for payment. A plan member shall execute and deliver to the risk manager such documents as are necessary to secure this right of subrogation in the sole opinion of the city attorney. A plan member shall not do anything after a plan claim is incurred to prejudice this right.

(1996 Code, sec. 8.906)

§ 1.08.037 Determination of coverage.

If the city denies coverage under the plan to a plan member, the plan member may seek a determination by a court of proper jurisdiction of whether the member is entitled to such coverage.