Missouri Revised Statutes
Chapter 86
Police Relief and Pension Systems
←86.1070
Section 86.1080.1
86.1090→
August 28, 2015
Purchase of insurance policies permitted--indemnification--expenses of court proceedings may be paid, when.
86.1080. 1. The retirement board may purchase with retirement system
assets from one or more insurers licensed to do business in this state one or
more insurance policies that provide for reimbursement of the retirement
system and any trustee, member of the retirement board, officer, or employee
of the retirement system for liability imposed or damages because of an
alleged act, error, or omission committed in the trustee's, board member's,
officer's, or employee's capacity as a fiduciary, officer, or employee of the
retirement system and for costs and expenses, including attorney fees,
incurred as a trustee, board member, officer, or employee in defense of a
claim for an alleged act, error, or omission, as long as the insurance policy
does not provide for reimbursement of a trustee, board member, officer, or
employee for liability imposed or expenses incurred because of the trustee's,
board member's, officer's, or employee's personal dishonesty, fraud, lack of
good faith, or intentional failure to act prudently.
2. If the insurance coverage described in subsection 1 of this section is
insufficient or is not in effect, the retirement board may indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit, or proceeding, whether civil,
criminal, administrative, or investigative, by reason of the fact that the
person is or was a member of the retirement board, or is or was serving at
the request of the retirement board in the capacity which caused the person's
relationship to such action, suit, or proceeding, against expenses, including
attorneys' fees, judgments, fines, and amounts paid in settlement actually
and reasonably incurred by the person in connection with such action, suit, or
proceeding, if the person acted in good faith and without willful
malfeasance, and, with respect to any criminal action or proceeding, had
reasonable cause to believe the relevant conduct was lawful. The termination
of any action, suit, or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent shall not, of
itself, create a presumption that the person did not act in good faith, or,
with respect to any criminal action or proceeding, that the person did not
have reasonable cause to believe that the relevant conduct was lawful.
3. To the extent that a member of the retirement board has been
successful on the merits or otherwise in defense of any action, suit, or
proceeding referred to in subsections 1 and 2 of this section, or in defense
of any claim, issue, or matter therein, the person shall be indemnified
against expenses, including attorneys' fees, actually and reasonably incurred
in connection with the action, suit, or proceeding that are not covered by
the insurance described in subsection 1 of this section.
4. Any indemnification under this section, unless ordered by a court,
shall be made by the retirement board only as authorized in each specific
case upon a determination that indemnification of any person potentially
entitled to indemnification hereunder is proper in the circumstances because
the person has met the applicable standard of conduct set forth in this
section. The determination shall be made by the retirement board by a
majority vote of a quorum consisting of members of the retirement board who
are not parties to the action, suit, or proceeding, or if such a quorum is not
obtainable, or even if obtainable and a quorum of disinterested members of
the retirement board so directs, by independent legal counsel in a written
opinion. Such legal counsel may but need not be counsel to the retirement
system.
5. Expenses incurred in defending a civil or criminal action, suit, or
proceeding may be paid by the retirement board in advance of the final
disposition of the action, suit, or proceeding as authorized by the
retirement board in the specific case upon receipt of an undertaking by or on
behalf of the person potentially entitled to indemnification hereunder to
repay such amount unless it shall ultimately be determined that the person is
entitled to be indemnified by the retirement board as authorized in this
section.
(L. 2005 H.B. 323)
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