Public Act 099-0461

SB1102 Enrolled LRB099 05349 JLK 25384 b

AN ACT concerning government.

Be it enacted by the People of the State of Illinois,

represented in the General Assembly:

Section 5. The State Employee Indemnification Act is

amended by changing Section 2 as follows:

(5 ILCS 350/2) (from Ch. 127, par. 1302)

Sec. 2. Representation and indemnification of State

employees.

(a) In the event that any civil proceeding is commenced

against any State employee arising out of any act or omission

occurring within the scope of the employee's State employment,

the Attorney General shall, upon timely and appropriate notice

to him by such employee, appear on behalf of such employee and

defend the action. In the event that any civil proceeding is

commenced against any physician who is an employee of the

Department of Corrections or the Department of Human Services

(in a position relating to the Department's mental health and

developmental disabilities functions) alleging death or bodily

injury or other injury to the person of the complainant

resulting from and arising out of any act or omission occurring

on or after December 3, 1977 within the scope of the employee's

State employment, or against any physician who is an employee

of the Department of Veterans' Affairs alleging death or bodily

injury or other injury to the person of the complainant

resulting from and arising out of any act or omission occurring

on or after the effective date of this amendatory Act of 1988

within the scope of the employee's State employment, or in the

event that any civil proceeding is commenced against any

attorney who is an employee of the State Appellate Defender

alleging legal malpractice or for other damages resulting from

and arising out of any legal act or omission occurring on or

after December 3, 1977, within the scope of the employee's

State employment, or in the event that any civil proceeding is

commenced against any individual or organization who contracts

with the Department of Labor to provide services as a carnival

and amusement ride safety inspector alleging malpractice,

death or bodily injury or other injury to the person arising

out of any act or omission occurring on or after May 1, 1985,

within the scope of that employee's State employment, the

Attorney General shall, upon timely and appropriate notice to

him by such employee, appear on behalf of such employee and

defend the action. Any such notice shall be in writing, shall

be mailed within 15 days after the date of receipt by the

employee of service of process, and shall authorize the

Attorney General to represent and defend the employee in the

proceeding. The giving of this notice to the Attorney General

shall constitute an agreement by the State employee to

cooperate with the Attorney General in his defense of the

action and a consent that the Attorney General shall conduct

the defense as he deems advisable and in the best interests of

the employee, including settlement in the Attorney General's

discretion. In any such proceeding, the State shall pay the

court costs and litigation expenses of defending such action,

to the extent approved by the Attorney General as reasonable,

as they are incurred.

(b) In the event that the Attorney General determines that

so appearing and defending an employee either (1) involves an

actual or potential conflict of interest, or (2) that the act

or omission which gave rise to the claim was not within the

scope of the employee's State employment or was intentional,

wilful or wanton misconduct, the Attorney General shall decline

in writing to appear or defend or shall promptly take

appropriate action to withdraw as attorney for such employee.

Upon receipt of such declination or upon such withdrawal by the

Attorney General on the basis of an actual or potential

conflict of interest, the State employee may employ his own

attorney to appear and defend, in which event the State shall

pay the employee's court costs, litigation expenses and

attorneys' fees to the extent approved by the Attorney General

as reasonable, as they are incurred. In the event that the

Attorney General declines to appear or withdraws on the grounds

that the act or omission was not within the scope of

employment, or was intentional, wilful or wanton misconduct,

and a court or jury finds that the act or omission of the State

employee was within the scope of employment and was not

intentional, wilful or wanton misconduct, the State shall

indemnify the State employee for any damages awarded and court

costs and attorneys' fees assessed as part of any final and

unreversed judgment. In such event the State shall also pay the

employee's court costs, litigation expenses and attorneys'

fees to the extent approved by the Attorney General as

reasonable.

In the event that the defendant in the proceeding is an

elected State official, including members of the General

Assembly, the elected State official may retain his or her

attorney, provided that said attorney shall be reasonably

acceptable to the Attorney General. In such case the State

shall pay the elected State official's court costs, litigation

expenses, and attorneys' fees, to the extent approved by the

Attorney General as reasonable, as they are incurred.

(b-5) The Attorney General may file a counterclaim on

behalf of a State employee, provided:

(1) the Attorney General determines that the State

employee is entitled to representation in a civil action

under this Section;

(2) the counterclaim arises out of any act or omission

occurring within the scope of the employee's State

employment that is the subject of the civil action; and

(3) the employee agrees in writing that if judgment is

entered in favor of the employee, the amount of the

judgment shall be applied to offset any judgment that may

be entered in favor of the plaintiff, and then to reimburse

the State treasury for court costs and litigation expenses

required to pursue the counterclaim. The balance of the

collected judgment shall be paid to the State employee.

(c) Notwithstanding any other provision of this Section,

representation and indemnification of a judge under this Act

shall also be provided in any case where the plaintiff seeks

damages or any equitable relief as a result of any decision,

ruling or order of a judge made in the course of his or her

judicial or administrative duties, without regard to the theory

of recovery employed by the plaintiff. Indemnification shall be

for all damages awarded and all court costs, attorney fees and

litigation expenses assessed against the judge. When a judge

has been convicted of a crime as a result of his or her

intentional judicial misconduct in a trial, that judge shall

not be entitled to indemnification and representation under

this subsection in any case maintained by a party who seeks

damages or other equitable relief as a direct result of the

judge's intentional judicial misconduct.

(d) In any such proceeding where notice in accordance with

this Section has been given to the Attorney General, unless the

court or jury finds that the conduct or inaction which gave

rise to the claim or cause of action was intentional, wilful or

wanton misconduct and was not intended to serve or benefit

interests of the State, the State shall indemnify the State

employee for any damages awarded and court costs and attorneys'

fees assessed as part of any final and unreversed judgment, or

shall pay such judgment. Unless the Attorney General determines

that the conduct or inaction which gave rise to the claim or

cause of action was intentional, wilful or wanton misconduct

and was not intended to serve or benefit interests of the

State, the case may be settled, in the Attorney General's

discretion and with the employee's consent, and the State shall

indemnify the employee for any damages, court costs and

attorneys' fees agreed to as part of the settlement, or shall

pay such settlement. Where the employee is represented by

private counsel, any settlement must be so approved by the

Attorney General and the court having jurisdiction, which shall

obligate the State to indemnify the employee.

(e) (i) Court costs and litigation expenses and other costs

of providing a defense or counterclaim, including attorneys'

fees obligated under this Section, shall be paid from the State

Treasury on the warrant of the Comptroller out of

appropriations made to the Department of Central Management

Services specifically designed for the payment of costs, fees

and expenses covered by this Section.

(ii) Upon entry of a final judgment against the employee,

or upon the settlement of the claim, the employee shall cause

to be served a copy of such judgment or settlement, personally

or by certified or registered mail within thirty days of the

date of entry or settlement, upon the chief administrative

officer of the department, office or agency in which he is

employed. If not inconsistent with the provisions of this

Section, such judgment or settlement shall be certified for

payment by such chief administrative officer and by the

Attorney General. The judgment or settlement shall be paid from

the State Treasury on the warrant of the Comptroller out of

appropriations made to the Department of Central Management

Services specifically designed for the payment of claims

covered by this Section.

(f) Nothing contained or implied in this Section shall

operate, or be construed or applied, to deprive the State, or

any employee thereof, of any defense heretofore available.

(g) This Section shall apply regardless of whether the

employee is sued in his or her individual or official capacity.

(h) This Section shall not apply to claims for bodily

injury or damage to property arising from motor vehicle

accidents.

(i) This Section shall apply to all proceedings filed on or

after its effective date, and to any proceeding pending on its

effective date, if the State employee gives notice to the

Attorney General as provided in this Section within 30 days of

the Act's effective date.

(j) The amendatory changes made to this Section by this

amendatory Act of 1986 shall apply to all proceedings filed on

or after the effective date of this amendatory Act of 1986 and

to any proceeding pending on its effective date, if the State

employee gives notice to the Attorney General as provided in

this Section within 30 days of the effective date of this

amendatory Act of 1986.

(k) This Act applies to all State officials who are serving

as trustees, or their appointing authorities, of a clean energy

community trust or as members of a not-for-profit foundation or

corporation established pursuant to Section 16-111.1 of the

Public Utilities Act.

(l) The State shall not provide representation for, nor

shall it indemnify, any State employee in (i) any criminal

proceeding in which the employee is a defendant or (ii) any

criminal investigation in which the employee is the target.

Nothing in this Act shall be construed to prohibit the State

from providing representation to a State employee who is a

witness in a criminal matter arising out of that employee's

State employment.

(Source: P.A. 90-655, eff. 7-30-98; 91-781, eff. 6-9-00.)

Section 10. The Local Governmental and Governmental

Employees Tort Immunity Act is amended by changing Section

2-302 as follows:

(745 ILCS 10/2-302) (from Ch. 85, par. 2-302)

Sec. 2-302. If any claim or action is instituted against an

employee of a local public entity based on an injury allegedly

arising out of an act or omission occurring within the scope of

his employment as such employee, the entity may elect to do any

one or more of the following:

(a) appear and defend against the claim or action;

(b) indemnify the employee or former employee for his

court costs or reasonable attorney's fees, or both,

incurred in the defense of such claim or action;

(c) pay, or indemnify the employee or former employee

for a judgment based on such claim or action; or

(d) pay, or indemnify the employee or former employee

for, a compromise or settlement of such a claim or action.

It is hereby declared to be the public policy of this

State, however, that no local public entity may elect to

indemnify an employee for any portion of a judgment

representing an award of punitive or exemplary damages.

If an employee of a local public entity is a defendant in

any criminal action arising out of or incidental to the

performance of his or her duties, the local public entity shall

not provide representation for the employee in that criminal

action. However, the local public entity may reimburse the

employee for reasonable defense costs only if the criminal

action was instituted against the employee based upon an act or

omission of that employee arising out of and directly related

to the lawful exercise of his or her official duty or under

color of his or her authority and that action is dismissed or

results in a final disposition in favor of that employee.

The provisions of indemnification, as set forth above,

shall be justifiably refused by the local public entity if it

is determined that there exists a current insurance policy or a

contract, by virtue of which the employee is entitled to a

defense of the action in question.

Nothing in this Act shall be construed to prohibit a local

public entity from providing representation to an employee who

is a witness in a criminal matter arising out of that

employee's employment with the local government entity.

(Source: P.A. 92-810, eff. 8-21-02.)