Chapter 2.25
INDEMNIFICATION OF EMPLOYEES AND OFFICERS
Sections:
2.25.010 Request for defense or indemnification.
2.25.020 Representation and payment of claims – Conditions.
2.25.030 Payment of judgment by town.
2.25.040 Failure to comply with conditions.
2.25.050 Reimbursement of incurred attorneys’ fees and costs.
2.25.005 Definitions.
Unless the context indicates otherwise, the words and phrases used in this chapter shall have the following meanings:
(1) “Employee” means any person who is or has been employed by the town.
(2) “Official” means any person who is serving or has served as an elected town official, and any person who is serving or has served as an appointed member of any town board, commission, committee or other appointed position with the town.
(3) “Volunteer” means any person who is working or has worked in an unpaid position for the town. [Ord. 336 § 2, 1998]
2.25.010 Request for defense or indemnification.
(1) Whenever an action or proceeding for damages is brought against a past or present official, employee or volunteer, which arises from acts or omissions while performing or in good faith purporting to perform his or her official duties, such officer, employee or volunteer may request the town council to authorize the defense of the action or proceeding at the expense of the town.
(2) Upon receipt of the request for defense described in subsection (1) of this section, the town council will consider whether any of the following factors are present:
(a) The official, employee or volunteer engaged in any dishonest, fraudulent, criminal, willful, intentional or malicious act or course of conduct;
(b) The official, employee or volunteer engaged in any act or course of conduct which was not performed on behalf of the town;
(c) The official, employee or volunteer engaged in any act or course of conduct which is outside the scope of the official’s, employee’s or volunteer’s service or employment with the town; and/or
(d) Any lawsuit is brought against an official, employee or volunteer by or on behalf of the town.
(3) If none of the factors outlined in subsection (2) of this section are present, and the acts or omissions of the official, employee or volunteer were, or in good faith purported to be, within the scope of his or her official duties, then the request shall be granted.
(4) If the town council grants the request, then the town shall pay all necessary attorneys’ fees and costs of defending the action or proceeding.
(5) If the request is granted by the town council, any legal services necessary to defend against the action or proceeding shall be provided by the office of the town attorney unless:
(a) Any provision of an applicable policy of insurance provides otherwise; or
(b) A conflict of interest or ethical bar exists with respect to said representation.
(6) Nothing herein shall be construed to waive or impair the right of the town council to institute suit or counterclaim against any official, employee or volunteer nor to limit its ability to discipline or terminate an official, employee or volunteer.
(7) The provisions of this chapter shall have no force or effect with respect to any accident, occurrence or circumstance for which the town or the official, employee or volunteer is insured against loss or damages. This chapter shall provide protection, subject to its terms and limitations, above any loss limit of such policy. The provisions of this chapter are intended to be secondary to any contract or policy of insurance owned or applicable to any official, employee or volunteer. The town shall have the right to require an official, employee or volunteer to utilize any such policy protection prior to requesting the protection afforded by this chapter.
(8) Nothing herein shall preclude the town from undertaking an officer’s, employee’s, or volunteer’s defense under a reservation of rights. The determination as to whether to furnish a defense as provided under this chapter to a member or members of the town council shall be made without the vote of such member or members of the town council unless the inclusion of such member or members is required for a quorum; provided, that if a claim or lawsuit affects a quorum or greater number of the members of the town council, all such affected members shall retain their voting privileges under this section. [Ord. 336 § 2, 1998]
2.25.020 Representation and payment of claims – Conditions.
The provisions of this chapter shall apply only when the following conditions are met:
(1) In the event of any incident or course of conduct potentially giving rise to a claim for damage, or the commencement of a suit, the official, employee or volunteer involved shall, as soon as practicable, give the town attorney written notice thereof. Such notice shall include the following information:
(a) The identity of the official, employee or volunteer involved;
(b) All information known to the official, employee or volunteer involved;
(c) All information known to the official, employee or volunteer with respect to the date, time, place and circumstances surrounding the incident or conduct giving rise to the claim or lawsuit;
(d) The names and addresses of all persons allegedly injured or otherwise damaged thereby; and
(e) The names and addresses of all witnesses;
(2) Upon receipt of any claim, demand, notice or summons or other process relating to any such incident or conduct, the official, employee or volunteer shall immediately deliver the same to the town attorney, and shall cooperate with the town attorney or an attorney designated by the town attorney, and, upon request, assist in making settlement of any suit and enforcing any claim for any right of subrogation against any persons or organizations that may be liable to the town because of any damage or claim of loss arising from said incident or course of conduct, including, but not limited to, rights of recovery for costs and attorneys’ fees arising under state or federal law upon a determination that the suit brought is frivolous in nature;
(3) Such official, employee or volunteer shall attend interviews, depositions, hearings and trials and shall assist in securing and giving evidence and obtaining attendance of witnesses all without any additional compensation to the official, employee or volunteer and, in the event that an employee has left the employ of the town, no fee or compensation shall be provided; and
(4) Such official, employee or volunteer shall not accept nor voluntarily make any payment, assume any obligation, or incur any expense relating to said claim or suit. [Ord. 336 § 2, 1998]
2.25.030 Payment of judgment by town.
(1) If legal representation of an official, employee or volunteer is undertaken by the town attorney, all of the conditions of representation are met, and a judgment is entered against the official, employee or volunteer, or a settlement made, the official, employee or volunteer may request the town to pay any judgment entered against him or her under the terms of this section.
(2) Upon receipt of a request to pay a judgment, the town council will consider whether the official, employee, or volunteer was acting, or in good faith purported to be, within the scope of his or her official duties when the action or omission resulting in the judgment occurred. Payment of the judgment shall be in the sole discretion of the town council, except as specified in subsection (3) of this section.
(3) In accordance with RCW 4.96.041(4), when an official, employee or volunteer is represented at the expense of the town, all of the conditions of representation are met, a judgment is entered against the official, employee or volunteer for damages under Chapter 4.96 RCW or 42 U.S.C. Section 1981 et seq., and the court hearing the action has found that the officer, employee or volunteer was acting within the scope of his or her official duties, then the town shall pay any judgment against the official, employee or volunteer to the extent that such judgment is not for punitive damages. The decision to pay a punitive damage award is within the discretion of the town council. [Ord. 336 § 2, 1998]
2.25.040 Failure to comply with conditions.
In the event that any official, employee or volunteer fails or refuses to comply with any of the conditions of HPMC 2.25.020, or elects to provide his/her own representation with respect to any such claim or litigation, then all of the provisions of this chapter shall be inapplicable, and have no force or effect with respect to any such claim or litigation. [Ord. 336 § 2, 1998]
2.25.050 Reimbursement of incurred attorneys’ fees and costs.
(1) If the town determines not to provide representation of an official, employee or volunteer under the provisions of this chapter, and a court of competent jurisdiction later determines that such representation should have been provided within the provisions of this chapter, then the town shall pay any attorneys’ fees and costs incurred by the official, employee or volunteer in defending against the claim. The town shall pay any costs and reasonable attorneys’ fees incurred in obtaining the determination that such claim is covered by the provisions of this chapter; provided, if a court of competent jurisdiction determines that such claim does not come within the provisions of this chapter, then the official, employee or volunteer shall pay the town’s costs and reasonable attorneys’ fees incurred in obtaining the determination that such claim is not covered under the provisions of this chapter.
(2) If the town provides representation to the official, employee or volunteer within the provisions of this chapter, and a court of competent jurisdiction later finds the existence of one of the factors in HPMC 2.25.010(2), then the official, employee or volunteer shall reimburse the town for the attorneys’ fees and costs incurred in obtaining the determination that such claim is not covered by the provisions of this chapter. [Ord. 336 § 2, 1998]
2.25.060 Pending claims.
The provisions of this chapter shall apply to any pending claim or lawsuit against an official, employee or volunteer, or any such claim or lawsuit hereafter filed, without regard to the date of events or circumstances which are the basis of such claim or lawsuit. [Ord. 336 § 2, 1998]