§ 122C-153. Defense of agents, employees, and board members. - North Carolina Statutes

§122C‑153.  Defense of agents, employees, and board members.

(a)        Upon request madeby or in behalf of any agent, employee, or board member or former agent,employee, or board member of the area authority, any area authority may providefor the defense of any civil or criminal action or proceeding brought againsthim either in his official or in his individual capacity, or both, on accountof any act done or omission made, or any act allegedly done or omissionallegedly made, in the scope and course of his duty as an agent, employee, orboard member. The defense may be provided by the local board by employingcounsel or by purchasing insurance that requires that the insurer provide thedefense. Nothing in this section requires any area authority to provide for thedefense of any action or proceeding of any nature.

(b)        An area authoritymay budget funds for the purpose of paying all or part of the claim made or anycivil judgment entered against any of its agents, employees, or board membersor former agents, employees, or board members when a claim is made or judgmentis rendered as damages on account of any act done or omission made, or any actallegedly done or omission allegedly made, in the scope and course of his dutyas an agent, employee, or board member of the area authority. Nothing in thissection shall authorize any area authority to budget funds for the purpose ofpaying any claim made or civil judgment against any of its agents, employees,or board members, or former agents, employees, or board members, if theauthority finds that the agent, employee, or board member acted or failed toact because of actual fraud, corruption, or actual malice on his part. Anyauthority may budget for and purchase insurance coverage for payment of claimsor judgments pursuant to this section. Nothing in this section requires anyauthority to pay any claim or judgment referred to, and the purchase ofinsurance coverage for payment of the claim or judgment may not be consideredan assumption of any liability not covered by the insurance contract and maynot be deemed an assumption of liability or payment of any claim or judgment inexcess of the limits of coverage in the insurance contract.

(c)        Subsection (b) ofthis section does not authorize an authority to pay all or part of a claim madeor civil judgment entered or to provide a defense to a criminal charge unless(i) notice of the claim or litigation is given to the area authority before thetime that the claim is settled or civil judgment is entered; and (ii) the areaauthority has adopted, and made available for public inspection, uniformstandards under which claims made, civil judgments entered, or criminal chargesagainst agents, employees, or board members or former agents, employees, orboard members shall be defended or paid.

(d)        The board or boardsof county commissioners that establish the  area authority and the Secretarymay allocate funds not otherwise restricted by law, in addition to the fundsallocated for the operation of the program, for the purpose of paying legaldefense, judgments, and settlements under this section. (1981,c. 539, s. 2; 1985, c. 589, s. 2.)