§ 58-30-71. Immunity and indemnification of the receiver and employees. - North Carolina Statutes

§58‑30‑71.  Immunity and indemnification of the receiver andemployees.

(a)        For the purposes ofthis section, the persons entitled to protection under this section are:

(1)        All receiversresponsible for the conduct of a delinquency proceeding under this Article,including present and former receivers; and

(2)        Their employeesmeaning all present and former special deputies and assistant special deputiesappointed by the Commissioner, staff assigned to the delinquency proceedingemployed by the Attorney General's Office, and all persons whom theCommissioner, special deputies, or assistant special deputies have employed toassist in a delinquency proceeding under this Article.  Attorneys, accountants,auditors, and other professional persons or firms, who are retained by thereceiver as independent contractors and their employees are not employees ofthe receiver for purposes of this section.

(b)        The receiver andhis employees have official immunity and are immune from suit and liability,both personally and in their official capacities, for any claim for damage toor loss of property or personal injury or other civil liability caused by orresulting from any alleged act, error, or omission of the receiver or anyemployee arising out of or by reason of their duties or employment; providedthat nothing in this section holds the receiver or any employee immune fromsuit or liability for any damage, loss, injury, or liability caused by theintentional or willful and wanton misconduct of the receiver or any employee orfor any bodily injury caused by the operation of a motor vehicle.

(c)        If any legal actionis commenced against the receiver or any employee, whether against himpersonally or in his official capacity, alleging property damage, propertyloss, personal injury, or other civil liability caused by or resulting from anyalleged act, error, or omission of the receiver or any employee arising out ofor by reason of their duties or employment, the receiver and any employee shallbe indemnified from the assets of the insurer for all expenses, attorneys'fees, judgments, settlements, decrees, or amounts due and owing or paid insatisfaction of or incurred in the defense of such legal action; unless it isdetermined upon a final adjudication on the merits that the alleged act, error,or omission of the receiver or employee giving rise to the claim did not ariseout of or by reason of his duties or employment, or was caused by intentionalor willful and wanton misconduct.

(d)        Attorneys' fees andall related expenses incurred in defending a legal action for which immunity orindemnity is available under this section shall be paid from the assets of theinsurer, as they are incurred, before the final disposition of the action, uponreceipt of any agreement by or on behalf of the receiver or employee to repaythe attorneys' fees and expenses if it is ultimately determined upon a finaladjudication on the merits that the receiver or employee is not entitled toimmunity or indemnity under this section.

(e)        Any indemnificationfor expense payments, judgments, settlements, decrees, attorneys' fees, suretybond premiums, or other amounts paid or to be paid from the insurer's assetsunder this section shall be an administrative expense of the insurer.

(f)         In the event ofany actual or threatened litigation against a receiver or any employee forwhich immunity or indemnity may be available under this section, a reasonableamount of funds, that in the judgment of the Commissioner may be needed toprovide immunity or indemnity, shall be segregated and reserved from the assetsof the insurer as security for the payment of indemnity until all applicablestatutes of limitation have run, all actual or threatened actions against thereceiver or any employee have been completely and finally resolved, and allobligations of the insurer and the Commissioner under this section have beensatisfied.

(g)        In lieu ofsegregation and reserving of funds, the Commissioner may, in his discretion,obtain a surety bond or make other arrangements that will enable theCommissioner to fully secure the payment of all obligations under this section.

(h)        If any legal actionagainst an employee for which indemnity may be available under this section issettled before final adjudication on the merits, the insurer must pay thesettlement amount on behalf of the employee, or indemnify the employee for thesettlement amount, unless the Commissioner determines:

(1)        That the claim didnot arise out of or by reason of the employee's duties or employment; or

(2)        That the claims werecaused by the intentional or willful and wanton misconduct of the employee.

(i)         In any legalaction in which the receiver is a defendant, that portion of any settlementrelating to the alleged act, error, or omission of the receiver is subject tothe approval of the court before which the delinquency proceeding is pending. The court shall not approve that portion of the settlement if it determines:

(1)        That the claim didnot arise out of or by reason of the receiver's duties or employment; or

(2)        That the claim wascaused by the intentional or willful and wanton misconduct of the receiver.

(j)         Nothing in thissection deprives the receiver or any employee of any immunity, indemnity,benefits of law, rights, or any defense otherwise available.

(k)        Subsection (b) ofthis section applies to any suit based in whole or in part on any alleged act,error, or omission that occurs on or after October 1, 1993.

(l)         No legal actionshall lie against the receiver or any employee based in whole or in part on anyalleged act, error, or omission that occurred before October 1, 1993, unlesssuit is filed and valid service of process is obtained within 12 months afterOctober 1, 1993.

(m)       Subsections (c),(h), and (i) of this section apply to any suit that is pending on or filedafter October 1, 1993, without regard to when the alleged act, error, oromission took place. (1993, c. 452, s. 40.)