The Borough hereby finds that it is appropriate
to provide for the indemnification and defense of Borough employees,
appointees, and officials in accordance with the provisions of N.J.S.A.
59:10-4 and applicable law which empowers local public entities to
provide for such indemnification.
As used in this chapter, the following term
shall have the meanings indicated:
EMPLOYEE
Any official, officer or member of the Borough's agencies,
commissions or Council of the Borough, or employee or servant, whether
or not compensated, full- or part-time, elected, appointed or employed,
who is authorized to perform any act or service; provided, however,
that the term does not include an independent contractor. The term
shall also include persons formerly holding office or employment.
The term "employee" is to be construed liberally in order to effectuate
the purposes of this chapter.
An employee shall not be entitled to indemnification
or the cost of defense under this chapter unless, within 10 days of
the time such employee is served with any summons, order to show cause,
complaint, process, notice, demand or pleading, he/she delivers the
same, or a copy thereof, to the Borough Clerk, who shall then forthwith
notify the Mayor and Council of the pending action; provided, however,
that this time period may be extended for good cause by the affirmative
vote of a majority of the full membership of the governing body.
The Borough may provide any defense required
of it under this chapter through the Borough Attorney or by employing
other counsel as it deems appropriate. Where a conflict of interest
may exist, the public employee may engage his or her own counsel,
which counsel shall be subject to the reasonable satisfaction of the
governing body. Such engagement shall be further subject to an appropriate
agreement between the Borough and the public employee.
Except as otherwise provided in this chapter,
whenever the Borough provides any defense required of it under this
chapter, the Borough, through counsel, may assume exclusive control
over the representation of the public employee, and such employee
shall cooperate fully with the defense.
In the event that a judgment is entered in favor
of the public employee at the trial court level and the adverse party
files an appeal therefrom, the governing body shall be obligated to
pay the costs of counsel beyond the trial court level. In the event
that an adverse judgment is entered against the public employee at
the trial court level and the public employee or adverse party seeks
to appeal therefrom, it shall be within the sole discretion of the
governing body to decide whether to pay for the costs of counsel beyond
the trial court level.
An employee claiming indemnification under this
chapter shall cooperate fully and in good faith with the Borough and
with attorneys, adjusters, investigators or experts, or technical
personnel engaged by the Borough for the preparation and presentation
of a defense to such action, or the settlement or other disposition
thereof, and if the employee neglects, fails or refuses to cooperate,
as herein required, the governing body, after a hearing on 10 days'
written notice to the employee, and for cause, may declare all rights
created under this chapter for the benefit of such employee to be
forfeited and terminated by the affirmative vote of a majority of
the full membership of the Borough Council.