= &nb= sp; = &nb= sp; BOROUGH OF NORWOOD

= &nb= sp; = &nb= sp; ORDINANCE NO. 04:07

AN ORDIN= ANCE AMENDING CHAPTER 17 OF THE CODE OF THE BOROUGH OF NORWOOD TO REVISE THE TER= MS AND CONDITIONS FOR THE DEFENSE AND INDEMNIFICATION OF CERTAIN BOROUGH VOLUNTEERS, OFFICERS, AND EMPLOYEES

WHEREAS, the purpose of this ordinance is to amend Chapter 17 of the Borough’s Code to set forth the terms and conditions under which the Borough may defe= nd and/or indemnify Borough employees, volunteers, and officials who are subje= cted to claims, litigation, and/or legal fees as a result of the performance of their official duties, as authorized, inter alia, by the New Jersey Tort Claims Act, N.J.S.A. 59:10-4.

NOW, THEREFORE, BE IT ORDAINED by the Mayor and Council of the Borough of Norwood as follows:

Section 1: Chapter 17 of the Code= of the Borough shall be amended to state the following:

Chapter 17. &= nbsp; DEFENSE AND INDEMNIFICATION OF OFFICIALS AND EMPLOYEES

§17.1. = Definitions: The following terms when used in this Chapter

shall be define= d as set forth in this section. An= y term that is not defined in this Chapter shall be defined in accordance with the provisions of the New Jersey Tort Claims Act, N.J.S.A. 59:1-1 et = seq., and the cases decided thereunder.

A. = ; "Borough Attorney" - means the Attorney from the Borough of Norwood.

B. = ; "Borough Official" - means all appointed or elected employees, agents, officers, and volunteers of the Borough of Norwood.

C. = ; "Civil Suit" - means any civil or administrative action that is pending in: (i) the New Jersey Supreme, Superi= or, or Tax Courts; (ii) the Courts of the United States; (iii) any other Court of competent jurisdiction; and (iv) any State, federal, or local administrative body or agency, and that is arising o= ut of and directly related to a Public Official’s lawful exercise of his or= her authority or duty in the furtherance of the Public Official’s authori= ty or duty. &nbs= p;

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D. = ; "Claim" - means any written or oral expression of the intent of any person to prose= cute a Criminal Offense or an Ethical Offense, institute a Criminal Proceeding or an Ethics Proceeding, or file a Civil Suit against any Borough Official, either in the Borough Official’s official capacity = or individual capacity, for acts, omissions, or events arising out of, or connected, directly or indirectly, with the performance of the Borough Official’s duties.

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E. = ; "Criminal Offense" - means any offense that is defined as a crime in the United States or New Jersey Criminal Code, as well as all quasi-criminal offenses whether defined by Federal or State laws or regulations, or any county or municipal ordinance.

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F. = ; "Criminal Proceeding" - means any criminal, quasi-criminal, or other law enforce= ment proceeding that is pending in any State or Federal Court, regarding a Crimi= nal Offense arising out of and directly related to the Public Official’s lawful exercise of his or her authority or duty in the furtherance of the Public Official’s authority or duty.

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G. = “Ethical Offense” - means any violation= of the Local Government Ethics Law, N.J.S.A. 40A:9-22.1 et seq., and/or any Borough Ethics Ordinance adopted pursuant thereto.

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H. = “Ethics Proceeding” - means any proceed= ing that is pursued against a Borough Official alleging an Ethical Offense aris= ing out of and directly related to the Public Official’s lawful exercise = of his or her authority or duty in the furtherance of the Public Official̵= 7;s authority or duty. = &nb= sp;

I.<= span style=3D'font:7.0pt "Times New Roman"'> = &nb= sp; “Governing Body” - means the Mayor and Council of the Borough of Norwood. <= /span>

§17.2. = Defense of Civil Suits: As to Civ= il Suits in which a

Borough Officia= l is named as a party, the Borough shall defend and/or provide a defense for the Borough Official, as to all Claims, either through the Borough Attorney or = his or her designee, through legal counsel provided by the Borough’s insurance carrier, or by permitting the Borough Official to retain legal counsel chosen by the Borough Official.&nb= sp; If the Borough Official is authorized by the Governing Body to retai= n legal counsel, the Borough will pa= y only the reasonable cost of the representation, including investigation, costs, = and reasonable legal fees, as further defined in this chapter.

§17.3. Indemnification in Connection with = Civil Suits: As to

Civil Suits in which a Borough Official is a party, the Borough shall indemnify and hold harmless the Borough Official for all damage awards, verdicts, and any other forms of civil penalty or judgment not covered by insurance, unless it is determined that the Borough should not be responsible on account of the fac= tors set forth in this chapter or any other applicable State law.

§17.4. = Defense of Criminal Prosecutions: The Borough will not

provide a defen= se for Borough Officials who are charged with Criminal Offenses. The Governing Body may, however, authorize the Borough to reimburse the Borough Official for the reasonable = cost of the defense of a Criminal Proceeding, including investigation, costs, and reasonable legal fees, as further defined in this chapter, provided that the Criminal Proceeding is dismissed or is finally determined in favor of the Borough Official.

= §17.5. Defense = of Ethics Proceedings: The Borough will not

provide a defen= se for Borough Officials who are charged with Ethical Offenses. The Governing Body may, however, a= uthorize the Borough to reimburse the Borough Official for the reasonable cost of the defense of Ethics Proceeding, including investigation, costs, and reasonable legal fees, as further defined in this chapter, provided that the Ethics Proceeding is dismissed or is finally determined in favor of the Borough Official. In addition, the Bo= rough may indemnify a Borough Official if the Mayor and Council, by a majority vo= te, finds that a Borough Official who is found to have committed an Ethical Off= ense acted in a manner that was reasonably debatable at the time that the violat= ion occurred and that the Borough Official’s actions or omissions did not constitute willful misconduct or an intentional wrong.

§17.6. = Reasonable Costs of Defense: The Governing Body,

with the advice of the Borough Atto= rney, shall determine what costs, expenses, and legal fees are reasonable under t= he facts and circumstances of each Claim, Civil Suit, or Criminal Proceedings. The Borough only= will pay or indemnify the Borough Official for legal fees that are based on reasonable hourly rates, and will not pay retainers to attorneys or investigators. The Governing = Body will determine, on a case by case basis, the reasonable hourly rate to be p= aid to the legal counsel who is retained by a Borough Official as authorized by this Chapter.

§17.7. = Notice of Claims to be Provided to Borough:&n= bsp; Any

Borough Official who receives notice of a Claim or is named as a party in any Civil Suit, Et= hics Proceeding, or Criminal Proceeding, either in his or her official capacity = or in an individual capacity for events arising out of or connected directly or indirectly with the performance of his or her duty as a Borough Official, s= hall promptly advise the Governing Body and the Borough Attorney of the Claim or= that the Civil Suit or Criminal Proceeding has been commenced, and shall supply = to the Governing Body and the Borough Attorney a copy of any and all notices a= nd pleadings pertaining to the matter. The Borough Official shall thereafter cooperate with the appropriate Borough agents, attorneys, servants, and employees in effectuating the provisions of this ordinance.

§17.8. = Borough Not to be Liable: &nbs= p; The Borough will not

provide a Borou= gh Official with a defense or indemnification in the following instances:

A. = ; If the act or omission of the Borough Official constitutes a Criminal Offense, Ethical Offense, actual fraud, actual malice, willful misconduct, or an intentional or wrongful act = or omission;

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B. = ; If the act or omission of the Borough Official is outside the scope of the Bor= ough Official’s employment, duties, or official capacity;

C. = ; If the act or omission of the Borough Official does not arise out of and is not directly related to the Borough Official’s lawful exercise of his or = her authority or duty in the furtherance of the Borough Official’s author= ity or duty;

D. = ; If the action or proceeding has been brought by the Borough itself against the Borough Official;

E. = ; If the Borough Official has failed to substantially cooperate with the Borough= and its agents, servants, attorneys, and employees in connection with the matte= r;

F. = ; If it is not deemed appropriate by the Governing Body pursuant to the provisions of the = New Jersey Tort Claims Act, N.J.S= .A. 59:10-1, et. seq., or any other statute or applicable law; or=

= G.&n= bsp; = ; If insurance coverage is available to pay any or al= l of the legal costs or judgments, to the extent of such coverage.

§17.9. = Reimbursement Back to Borough Required: &n= bsp;

If, pursuant to= the terms of this chapter or any other applicable law, the Borough has paid any legal fees, defense costs, or damages on account of a Borough Official and = it is later determined that the payment of same was improper or was disallowed under the terms of this Ordinance or any law, or the Borough Official is compensated for these payments by any third party, then the Borough Official shall within thirty (30) days of the receipt of the Borough’s demand reimburse to the Borough the full amount of the improper or disallowed paym= ents made by the Borough.

§17.10. &= nbsp; Reimburseme= nt for Punitive Damages Prohibited:

The Borough sha= ll not reimburse any Borough Official for any punitive or exemplary damages, or any damages resulting from the commission of a Criminal Offense or an Ethic= al Offense by any Borough Official. The Borough may, however, indemnify a Borough Official for exemplary= or punitive damages if, in the judgment of the Governing Body, the acts commit= ted by the Borough Official upon which these damages are based did not constitu= te actual fraud, actual malice, willful misconduct, or an intentional wrong.

§17.11. = Control Over Litigation: When the Borough provides

a defense of a Borough Official pursuant to this Chapter, the Borough may assume exclusive= control of the representation of the Borough Official, to the extent permitted by law. If the Borough permits t= he Borough Official to retain legal counsel, the Governing Body may limit the extent of the participation of or the payment to the legal counsel if, in the opinion o= f the Governing Body, this limitation is reasonable under the circumstances and w= ill not prejudice the Borough Official.

§17.12. = Bifurcated Treatment: Nothing contai= ned in this

Ordinance shall prevent the Borough from bifurcating its treatment as to any Claim, Civil Action, or Criminal Proceeding, both as to whether and how it will provide a defense and/or indemnification. Accordingly, the Borough may provide a defense and/or indemnification for some allegations against a Borough Official, but not as to others, and = may provide the defense in different forms as to different allegations.

§17.13. &= nbsp; Police officers and others excluded: &nb= sp; This Chapter

is not intended= to conflict with any of the provisions of the New Jersey statutes that now req= uire or that subsequently require the Borough to provide for the defense and indemnification of any public officials specified therein, including but not limited to police officers, firefighters, and the municipal clerk. If any of the provisions of this Chapter are= in conflict with any provisions of these statutes, including but not limited to those that apply to police officers (N.J.S.A. 40A:14-155), firefighters (N.J.S.A. 40A:14-28), and the municipal clerk (N.J.S.A. 40A:9-134.1), the provisions of applicable New Jersey statutes, as interpreted by the courts of this State, shall prevail over the terms and conditions of this ordinance, but only to the extent of any inconsistency between the terms of the applicable statute and this Chapter.

Section 2: All Ordinances or part= s of Ordinances that are inconsistent with the provisions of this Ordinance are hereby repealed, but only to the extent of such inconsistencies.

Section 3: The provisions of this Ordinance are severable. If a= ny part of this Ordinance is declared to be unconstitutional or invalid by any Court, the remaining parts of this Ordinance will remain in full force and effect.

Section 4: This Ordinance shall t= ake effect upon final approval and publication, according to law.

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Introduced and passed fir= st reading:

Passed second reading:

ATTEST: = &nb= sp; = &nb= sp; &= nbsp; &nbs= p; APPROVED BY:

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Lorraine McMackin, Borough Clerk = = &nb= sp; Michael Kaplan, Mayor