XII. Indemnification (reimbursement of legal fees and costs)
N.J.S.A. 18A:12-20 Whenever a civil, administrative, criminal or quasi-criminal action
or other legal proceeding has been brought against a board member for an act “arising
out of and in the course of the performance of his duties as a member of a board of
education” … “the board of education shall defray all costs of defending such action,
including reasonable counsel fees and expenses, together with costs of appeal, if any, and
shall save harmless and protect such person from any financial loss resulting therefrom.”
In criminal or quasi-criminal matters, the board of education shall defray the costs if the
final disposition of the action is favorable to the board member.
P.L. 2001, Chapter 178, Effective 7/26/01
! Castriotta v. Roxbury Twp. Bd. of Education, 427 N.J. Super. 592 (App.
Div. 2012) The Appellate Division, reversing the Commissioner’s
determination, ruled that a board member was entitled to be indemnified
for her costs in fighting the board’s action to censure her. The board
member’s challenge to the censure was a "legal proceeding" under the
indemnification law, N.J.S.A. 18A:12-20, because the board acted in a
quasi- judicial capacity, and the process was similar to a due process
hearing.
! Matthews, Commissioner 2010:April 15. Proceedings under the Code of
Ethics for School Board Members are administrative proceedings which
do not require favorable disposition for the charged party to be eligible
for indemnification. However, the particular actions on which the
allegations are based must be scrutinized – consistent with prior case law
as to time, place and subject matter – in terms of the statutory standard of
“arising out of and in the course of the performance of his duties as a
member of the board” in order to determine the entitlement to
indemnification. A complaint under the Code of Ethics for School Board
Members poses unique difficulties, since these complaints frequently
involve many diverse allegations rather than claims arising from a single
act. Matter remanded to the OAL to determine eligibility for
indemnification.
! Florham Park Bd. of Ed., v. Utica Mutual Insurance Co., 172 N.J. 300
(2002). In criminal matter, board’s liability to indemnify was not triggered
until acquittal; only the insurer whose insurance policy was in effect at
time of acquittal was liable.
! Grant v. Green Brook Board of Education, 2001 S.L.D. (August 13), aff’d
State Board, 2001 S.L.D. (Dec. 5). Indemnification denied for board
member who was sued for slander by private citizen, for making
knowingly false statements about the citizen (saying that citizen was a
racist, a nazi, and under investigation by the Department of Justice); board