CHAPTER 2.70
INDEMNIFICATION OF EMPLOYEES AND OFFICERS
Sections:
2.70.020 Defense and indemnification.
2.70.030 Notice of potential liability.
2.70.040 Determination of eligibility – Provision for defense.
2.70.050 Responsibility of official, employee or volunteer.
2.70.060 Payment of judgment, costs and expenses.
2.70.070 Limitations and reservations.
2.70.010 Definitions.
Unless the context indicates otherwise, the words and phrases used in this chapter shall have the following meaning:
"Employee" means any person who is or has been employed by the City, or is an independent contractor performing services for the benefit of, and on behalf of the City.
"Official" means any person who is serving or has served the City as an elected City official, appointive Officer, or as an appointed member of any City board, commission, committee or office.
"Volunteer" means a person who, without monetary compensation, serves or has served the City as a volunteer under the explicit authorization and direction of a City department. (Ord 07-200 §2; Ord 94-13 §1)
2.70.020 Defense and indemnification.
Subject to the terms and conditions of this chapter, an as a condition of employment or service, the City shall defend and indemnify every official, employee and volunteer who is or is threatened to be made a party to or otherwise involved in any actual or threatened action, suit, other than those as to which the City is or will be an adverse party, arising from any conduct, act or omission performed or omitted in good faith on behalf of the City in their capacity as an official, volunteer or employee, which conduct, act or omission is within the scope of that person’s employment by or service to the City, against all expense, liability and loss actually and reasonably incurred in connection therewith. (Ord 07-200 §2; Ord 94-13 §1)
2.70.030 Notice of potential liability.
As a condition of defense and indemnification the City described in this chapter:
A. Every official, employee or volunteer shall give written notice as soon as practicable to the City Attorney of:
1. Any accident, incident or course of conduct which the person has witnessed or been involved in which may give rise to a claim against the City or against the person as an official, employee or volunteer of the City; or
2. Any litigation, administrative action or claim commenced or filed against the person as an official, employee or volunteer of the City.
B. An official, employee or volunteer may give notice to the City Attorney of his or her request for defense and indemnification from a claim or action. (Ord 07-200 §2; Ord 94-13 §1)
2.70.040 Determination of eligibility – Provision for defense.
A. Determination of Eligibility for Indemnification. The City Council shall determine whether the City is obligated to defend or indemnify an official, volunteer or employee under the terms of this chapter based upon the recommendation of the City Attorney. The decision of the City Council shall state that the official, volunteer or employee meets or does not meet the criteria of this chapter. The determination as to whether to furnish a defense as provided under this chapter to a member or members of the City Council shall be made without the vote of members of the City 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 City Council, all such affected members shall retain their voting privileges under this section. All determinations of the City Council may be reviewed by the Superior Court of Grant County.
B. Provision of Defense. The legal services for the defense shall be provided by the office of the City Attorney unless:
1. Any provision of an applicable policy of insurance provides otherwise;
2. The City Attorney recommends alternate legal counsel to the case, with City Council approval; or
3. The City Attorney declares a conflict of interest upon which the City Council will appoint alternate legal counsel to the case.
Provided, however, the City shall not be obligated to pay costs of defense at rates in excess of those charged by the City Attorney to the City. (Ord 07-200 §2; Ord 94-13 §1)
2.70.050 Responsibility of official, employee or volunteer.
A. The official, employee or volunteer seeking defense and indemnification shall:
1. Provide to the City Attorney, or attorney designated to represent that person, all information known to that person with respect to the date, time, place and circumstances surrounding the incident or conduct, as well as the names and addresses of all persons allegedly injured or damaged thereby, and the names and addresses of all witnesses;
2. Deliver promptly to the City Attorney any demand, notice, summons or other process relating to any such incident or conduct, and cooperate with the City Attorney or designated attorney and, upon request, assist in making settlements of any suits and in enforcing any claim for any right of subrogation against any person or organization that may be liable to the City because of any damage or claim of loss arising from such incident or conduct;
3. As directed by the City Attorney or designated attorney, attend interviews, depositions, hearings and trials, and assist in securing and giving evidence and obtaining the attendance of witnesses;
4. Not accept nor voluntarily make any payment, assume any obligation, or incur any expense in relation to the claim or incident, except as authorized by the City Attorney or designated attorney; provided, however, that this section does not prohibit the administration of first aid at the time of an incident, or a reasonable attempt to avoid or mitigate injury or damage to persons or property;
5. Not object to a motion by the City to intervene as a party in any action covered by Section 2.70.020. (Ord 07-200 §2; Ord 94-13 §1)
2.70.060 Payment of judgment, costs and expenses.
A. A judgment against an official, employee or volunteer who is entitled to defense and indemnification under this chapter and who has complied with the requirements of this chapter shall be paid in the same manner as a judgment against the City, except any portion of the judgment which is for punitive damages.
B. The City Council may by resolution authorize payment of a judgment for punitive damages against a person who has been represented by the City Attorney or a designated attorney under Section 2.70.040.
C. Claims for other expense or loss covered by Section 2.70.020 may be submitted as other claims against the City.
D. If the request for defense and indemnification is denied by the City because the conduct was not within the scope of the officials, employee’s, or volunteer’s official duties and a court of competent jurisdiction later holds otherwise, the City shall pay the claim and reasonable attorney fees. If the request for defense and indemnification is granted by the City and a court of competent jurisdiction later holds that the conduct was outside the scope of Section 2.70.020, then the official, employee or volunteer shall reimburse the City for any costs or expenses incurred in defending such claim. (Ord 07-2000 §2; Ord 94-13 §1)
2.70.070 Limitations and reservations.
A. The City is not liable for costs or expenses incurred prior to receipt of the notice described in Section 2.70.040, except for those items described in the proviso of Section 2.70.050(4).
B. The City is not liable under this chapter for the costs of defense or any judgment in a criminal action against any official, employee or volunteer.
C. The provisions of Sections 2.70.020 and 2.70.060 do not apply to any action in which the City is an adverse party.
D. An initial decision to defend or indemnify under Section 2.70.040 does not preclude the City from seeking a determination that the conduct of the official, employee or volunteer was outside the scope of his or her duties, or a claim by the City against such person for damages to the City resulting from his or her wilful, wanton or intentional acts. Failure to cooperate with the defense as required by Section 2.70.050 is a withdrawal of the request for defense and indemnification and relieves the City of further liability. (Ord 07-200 §2; Ord 94-13 §1)
2.70.080 Insurance provisions.
Nothing contained in this chapter shall be construed to modify or amend any provision of any policy of insurance wherein the City or any official, employee or volunteer thereof is the named insured. In the event of any conflict between this chapter and the provisions of any such policy of insurance, the policy provisions shall control; provided, however, that nothing contained in this section shall be deemed to limit or restrict the right of any official employee or volunteer to full coverage pursuant to this chapter, it being the intent of this section to provide complete coverage outside and beyond insurance policies which may be in effect while not compromising the terms and conditions of such policies by any conflicting provision contained in this chapter. (Ord 07-200 §2; Ord 94-13 §1)
2.70.090 Union contracts.
If a bargaining unit contract covers any of the provisions covered by this chapter, all persons under such contract shall be governed by its provisions, rather than by the provisions of this chapter, where a conflict exists. (Ord 07-200 §2; Ord 94-13 §1)
2.70.100 Applicability.
A. Pending Claims. The obligation of the City to defend or indemnify an officer, employee or volunteer shall be limited to such actions, claims or lawsuits filed or instituted on or after the effective date of this chapter for those events, actions or omissions of which occurred-on or after the effective date of this chapter.
B. Effect of Repeal: This chapter is subject to repeal or modification at the sole discretion of the City Council, provided that such repeal or modification shall apply prospectively only, and shall have no effect upon the obligation to indemnify and/or defend against any claim which is based, in whole or in part, upon any act or omission of an official, employee or volunteer occurring prior to the effective date of the repeal or modification.
C. No Contract of Insurance. This chapter shall not be construed to create a contract between the City and any official, volunteer or employee or to create a contract of insurance. (Ord 07-200 §2; Ord 94-13 §1)