17:44B-8. Immunity of officers, members from personal liability

8. a. The officers and members of the supreme governing body or any subordinate body of a society shall not be personally liable for any benefits provided by a society.

b. Any person may be indemnified and reimbursed by any society for expenses reasonably incurred by, and liabilities imposed upon, that person in connection with or arising out of any action, suit or proceeding, whether civil, criminal, administrative or investigative, or threat thereof, in which the person may be involved by reason of the fact that he is or was a commissioner, officer, employee or agent of the society or of any firm, corporation or organization which he served in any capacity at the request of the society. A person shall not be indemnified or reimbursed: (1) in relation to any matter in an action, suit or proceeding which he is finally adjudged to be or have been guilty of breach of a duty as a director, officer, employee or agent of the society or (2) in relation to any matter in an action, suit or proceeding, or threat thereof, which results in a compromise settlement; unless in either case the person acted in good faith for a purpose the person reasonably believed to be in or not opposed to the best interests of the society and, in a criminal action or proceeding, in addition, had no reasonable cause to believe that his conduct was unlawful. The determination whether the conduct of that person met the standard required in order to justify indemnification and reimbursement in relation to any matter described in paragraph (1) or (2) of this subsection may only be made by the assembly or board of directors by a majority vote of a quorum consisting of persons who were not parties to that action, suit or proceeding or by a court of competent jurisdiction. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of no contest, as to that person shall not in itself create a conclusive presumption that the person did not meet the standard of conduct required in order to justify indemnification and reimbursement. The right of indemnification and reimbursement shall not be exclusive of other rights to which that person may be entitled as a matter of law and shall inure to the benefit of his heirs, executors and administrators.

c. A society shall have the power to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the society, or who is or was serving at the request of the society as a director, officer, employee or agent of any other firm, corporation or organization against any liability asserted against that person and incurred by him in that capacity or arising out of his status in that capacity whether or not the society would have the power to indemnify the person against that liability under this section.

d. No director, officer, employee, member or volunteer of a society serving without compensation, shall be liable, and no cause of action may be brought, for damages resulting from the exercise of judgment or discretion in connection with the duties or responsibilities of that person for the society unless the act or omission involved willful or wanton misconduct.

L.1997,c.322,s.8.