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HomeMy WebLinkAboutResolution No. 4565 RESOLUTION NO. 4565 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DOWNEY SUPPORTING AND RECOMMENDING THE AMENDMENT OF INSURANCE CODE SECTION 533, EVIDENCE CODE SECTION 352 AND GOVERNMENT CODE SECTIONS 825 AND 990 AS THEY CONCERN PUNITIVE DAMAGES. WHEREAS, the plaintiffs in lawsuits instituted against public officials and employees are increasingly seeking punitive damages, knowing that because such officers and employees are personally liable, there is greater pressure towards settlement of the litigation, even where such claims are not well founded; and WHEREAS, there are instances where punitive damages have been awarded by juries against public officials and employees principally because such persons are perceived to be unpopular defendants; and WHEREAS, juries have awarded punitive damages against public officers because relevant but prejudicial evidence was excluded at trial and the juries were not apprised of all the facts, and it is believed that the admission of all relevant evidence at a trial wherein punitive damages are sought would help prevent any unjust award of punitive damages against public employees; and WHEREAS, it is believed that municipalities should have the authority to either pay for or insure their employees against punitive damages; and WHEREAS, awards of punitive damages do constitute disincentives to qualified persons to enter or remain in the public service and is, therefore, contrary to the interests of all citizens of this State. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF DOWNEY DOES HEREBY FIND, DETERMINE AND RESOLVE AS FOLLOWS: SECTION 1. That it does support and recommend that Insurance Code Section 533, Evidence Code Section 352 and Government Code Sections 825 and 990 as they concern punitive damages be amended to read as follows: Insurance Code Section 533. S 533. Willful act of insured; negligence An insurer is not liable for a loss caused by the willful act of the insured; but he is not exonerated by the negligence of the insured, or of the insured's agents or others. Nothing contained herein is intended to prohibit an insurer from insuring an insured and its employees and agents against a claim or judgment for exemplary or punitive damages. Evidence Code Section 352 S 352. Discretion of court to exclude evidence. The court in its discretion may exclude evidence of its probative value, if substant- ially outweighed by the probability that its admission will (a) necessitate undue consumption of time or (b) create substantial danger of undue prejudice of confusing the issues, or of misleading the jury. Notwithstanding the foregoing provisions of this section, the court shall have no discretion and shall not exclude any relevant evidence offered against any party who is: (a) seeking punitive or exemplary damages or (b) seeking any damages against a peace officer for acts performed in the course and scope of his or her employment as a peace officer. Government Code Section 825 S 825. Request for defense or defense by public entity; payment of yp y� a pY judgment, compromise or settlement; agreement with employee; reservation of rights; memorandum of understanding. RESOLUTION NO. 4565 Page two If an employee or former employee of a public entity request the public entity to defend him against any claim of action against him for an injury arising out of an act or omission occurring within the scope of his employment as an employee of the public entity, and such request is made in writing not less than 10 days before the day of the trial, and the employee or former employee reasonably cooperates in good faith in the defense of the claim or action, the public entity shall pay any judgment based thereon or any compromise or settlement '— of the claim or action to which the public entity has agreed. If the public entity conducts the defense of an employee or former employee against any claim or action with his reasonable good faith cooperation, the public entity shall pay any judgment based thereon or any compromise or settlement of the claim or action to which the public entity has agreed; but, where the public entity conducted such defense pursuant to an agreement with the employee or former employee reserving the rights of the public entity not to pay the judgment, compromise or settlement until it is established that the injury arose out of an act or omission occurring within the scope of his employment as an employee of the public entity, the public entity is required to pay the judgment, compromise or settlement only if it is established that the injury arose out of an act or omission occurring in the scope of his employment as an employee of the public entity. Nothing in this section * ** shall obligate a public entity to pay such part of a claim or judgment as is for punitive or exemplary damages. Notwithstanding the foregoing provision of this section, a public entity is authorized by this section to pay such . part of a claim or judgment as is for punitive or exemplary damages, provided that the governing body of the public entity first make a finding that the payment of such claim or judgment would be in the best interests of the public. Said finding of the governing body shall only be made after it has reviewed the facts surrounding the circumstances giving rise to the claim or judgment, including but not limited to any reports, testimony and /or judgments rendered in a court of law wherein said claim or judgment was adjudicated. If the provisions of this section are in conflict with the provisions of a memorandum of understanding reached pursuant to Chapter 12 (commencing with Section 3650) of Division 4 of Title 1, the memoran- dum of understanding shall be controlling without further legislative action, except that if such provisions of a memorandum of understanding require the expenditure of funds, the provisions shall not become effective unless approved by the Legislature in the annual Budget Act. Government Code Section 990 S 990. Authority to insure generally Except for a liability which may be insured against pursuant to Division 4 (commencing with Section 3200) of the Labor Code, a local public entity may: (a) Insure itself against all or any part of any tort or inverse condemnation liability. (b) Insure any employee of the local public entity against all or any part of his liability for injury resulting from an act or omission in the scope of his employment. (c) Insure, contract or provide against a claim or the expense of defending a claim against the local public entity or its employee, whether or not liability exists on such claim, including a claim for damages under Section 3294 of the Civil Code or otherwise for the sake of example or by way of punishment, where such liability arose from an act or omission in the scope of his employment, and an insurance contract for such purpose is valid and binding, notwithstanding Section 1668 of the Civil Code, Section 533 of the Insurance Code, or any other provision of law. RESOLUTION NO. 4565 Page three (d) A hospital district may participate in a reciprocal or interinsurance exchange with the members of its medical staff as provided in Section 1284 of the Insurance Code. * ** Underlining ( ) indicates additions by amendment. Asterisks ( * * *) indicate deletions by amendment. SECTION 2. The City Clerk shall certify to the adoption of this resolution, and thenceforth and thereafter, the same shall be in full force and effect. APPROVED AND ADOPTED THIS 23rd day of April , 1985 vor 41 / YOR ATTEST: I / fr ` / ✓�I111.o. CITY CLERK I HEREBY CERTIFY that the foregoing resolution was duly adopted by the City Council of the City of Downey at a regular meeting thereof held on the 23rd day of April , 1985, by the following vote: AYES: 4 Council Member: Santangelo, Boggs, Cormack, Barb NOES: 0 Council Member: None ABSENT: 0 Council Member: None ABSTAIN: 1 Council Member: Davila CITY CLERK