1995-128E:\WPDOCS\ORD\INDEMN.EMP
AN ORDINANCE AMENDING CHAPTER 2, ENTITLED "ADMINISTRATION", OF THE
CODE OF ORDINANCES OF THE CITY OF DENTON BY ADDING A NEW ARTICLE
VIII ENTITLED "LEGAL DEFENSE AND INDEMNIFICATION OF CITY OFFICERS
AND EMPLOYEES"; AUTHORIZING THE PAYMENT OF ACTUAL DAMAGES, COURT
COSTS, AND ATTORNEYS' FEES AWARDED AGAINST A COUNCILMEMBER, COM-
MITTEE OR BOARD MEMBER, OFFICER, OR EMPLOYEE OF THE CITY OF DENTON,
TEXAS RESULTING FROM AN ACT OR OMISSION OF THAT EMPLOYEE IN THE
COURSE OR SCOPE OF HIS OR HER EMPLOYMENT WHICH ARISES FROM A CAUSE
OF ACTION FOR NEGLIGENCE AND PROVIDING FOR THE LEGAL DEFENSE OF
THAT OFFICER OR EMPLOYEE, IN ACCORDANCE WITH THE TERMS AND CON-
DITIONS OF THIS ORDINANCE; AND PROVIDING FOR AN EFFECTIVE DATE.
WHEREAS, the City of Denton has previously maintained a policy
and practice to indemnify all elected and appointed officers and
employees of the City from lawsuits, claims, or causes of action
arising from actions taken in the course and scope of their
employment; and
WHEREAS, Chapter 102 of the Texas Civil Practices and Remedies
Code, Vernon's Annotated Civil Statutes ("Code"), authorizes a
local government, such as the City of Denton, to pay actual
damages, court costs, and attorneys' fees awarded against an
employee of the local government, if the damages: (1) result from
an act or omission of the employee in the course and scope of his
or her employment for the City, and (2) arise from a cause of
action for negligence; and
WHEREAS, the City Council has determined that it is in the
public interest to formally adopt such a policy of paying damages
because it encourages public service and enables recruitment and
retention of qualified public employees; NOW, THEREFORE,
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS:
SECTION I. That Chapter 2, entitled "Administration", of the
Code of Ordinances of the City of Denton is hereby amended by
adding a new Article VIII entitled "Legal Defense and Indemnifica-
tion of City Officers and Employees", Sections 2-243 through 2-250
inclusive, which shall read as follows:
ARTICLE VIII. LEGAL DEFENSE ~ INDEMNIFICATION
OF CITY OFFICERS AND EMPLOYEES
Sec. 2-243. Definitions.
For purposes of this section, the term "employee" shall in-
clude all City Councilmembers, members of all City boards and com-
mittees, and all officers and employees of the City and any other
persons, including volunteers, former officers, volunteers or
employees and the estate of any such officer, volunteer or employee
encompassed within the definition of "employee" in Chapter 102 of
the Texas Civil Practice and Remedies Code, hereinafter referred to
as the "Code".
Sec. 2-244. Indemnification.
The City of Denton shall indemnify and pay actual damages,
court costs, and reasonable attorneys' fees, excluding punitive
damages, awarded against any City Councilmember, City board or
commission member, or other officer or employee of the City, to the
extent such damages are not covered under an insurance contract or
self-insurance program of the City authorized by statute, for
damages resulting from an act or omission of an employee acting in
the course and scope of his or her employment for the City; and
which arise from a cause of action for negligence.
Sec. 2-245. Type of Employment and Limitations.
The City of Denton shall never pay damages awarded against an
employee that arise from a cause of action for official misconduct,
or arise from a cause of action involving a wilful or wrongful act
or omission, or an act or omission constituting gross negligence.
The phrase "course and scope of employment" shall not include any
action which occurs during a period of time when the employee is
engaged in outside employment or is rendering contractual services
to someone other than the City or engaged in activities unrelated
to his or her municipal employment or services. Whether the
actions for which damages are awarded were performed during the
employee's course and scope of employment shall be determined by
the City, and this determination shall be final; provided however,
if the indemnity and payment of damages and legal representation
has been denied by the City, if a final judgment of a court of
competent jurisdiction determines that the employee was acting in
the scope and course of his or her employment and the employee was
not engaged in official misconduct, a wilful or wrongful act or
omission, or an act or omission constituting gross negligence, the
City shall pay any damages, court costs, and reasonable attorneys'
fees incurred in the defense of the claim reimbursed. The payments
under this ordinance by the City may not exceed One Hundred Thou-
sand Dollars ($100,000.00) to any one person, or Three Hundred
Thousand Dollars ($300,000.00) for any single occurrence, in the
case of personal injury or death; or Ten Thousand Dollars
($10,000.00) for a single occurrence for property damage, or any
other limitation on the payment of damages which is hereinafter
legally established.
Sec. 2-246. Legal Defense.
The City shall provide legal counsel to represent any
defendant for whom the City may pay damages under this article,
including any appeal resulting from the litigation under which
damages were or may be assessed. The legal counsel provided by the
City may be the City Attorney, or any member of the City Attorney's
staff, or the City's regularly employed counsel, unless there is a
potential conflict of interest between the City and the defendant,
in which case, the City shall employ other legal counsel to defend
the suit. Such legal representation shall be provided at no cost
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to the employee. Any employee may have his own counsel assist in
the defense at the sole expense of the employee. The employee
shall cooperate fully with the City, the City Attorney, or the City
appointed legal counsel in the preparation and presentation of the
case. The failure of the employee to so cooperate shall constitute
a waiver of the employee's right to representation and indemnity
under this article. Any legal counsel provided under this section
may settle the portion of the suit that may result in the payment
of damages by the City under this ordinance with approval of the
City Council. The City shall not be liable for any settlement of
any such claim or suit effected without the consent of the City
Council.
Sec. 2-247. Preservation of Defenses.
Nothing contained in this article shall waive any defenses
which are available to the City or the officer or employee under
the Tort Claims Act or any other applicable laws, including,
without limitation, the defense of governmental or sovereign
immunity, the limitations on governmental officers' and employees'
liability or the limitations on the amount of recoverable damages
as set forth in the Tort Claims Act and Chapters 102 through 104 of
the Code, as those laws may now read or may be amended in the
future. This article does not impose liability or waive immunity
for an employee who has common law, statutory, or other immunity.
Nothing contained in this article shall create any rights on behalf
of third parties who are not officers or employees of the City of
Denton.
Sec. 2-248. Notice.
The provisions of this article shall apply only if the City
has been given notice of the action brought against the City
employee in writing, which has been received by the City Manager
within thirty (30) calendar days of the service of process on the
employee.
Sec. 2-249. Disciplinary Action.
Nothing in this article shall prevent the City from taking any
disciplinary action against any employee for conduct defended or
indemnified by the City under this article, either before or after
the conclusion of the litigation.
Sec. 2-250. Suits on Behalf of the City.
Nothing in this article shall require the City to indemnify or
pay damages to any employee for recoveries made against him or her
in suits by or on behalf of the City, including, without limita-
tion, suits to collect delinquent taxes, assessments, and fines.
SECTION II. That it is the intention of the City Council that
this ordinance shall become a part of the Code of Ordinances of the
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City of Denton, Texas, and may be renumbered and codified therein
accordingly.
SECTION III. That Chapter 2 of the Code of Ordinances of the
City of Denton, Texas, as amended, shall remain in full force and
effect, save and except as amended by this ordinance.
SECTION IV. That it is hereby officially found and determined
that the meeting at which this ordinance was passed was open to the
public as required and that public notice of the time, place, and
purpose of said meeting was given as required by the Open Meeting
Act, Chapter 551 of the Texas Government Code.
SECTION V. That this ordinance shall become effective
immediately upon its passage and approval.
PASSED AND APPROVED this the //~'~/day of ~ , 1995.
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
APPROVED AS TO LEGAL FORM:
HERBERT L. PROUTY, CITY ATTORNEY
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