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Texas Insurance Code - Not Codified - Section 21A.014. Immunity And Indemnification Of Receiver And Assistants

Legal Research Home > Texas Lawyer > Insurance Code - Not Codified > Texas Insurance Code - Not Codified - Section 21A.014. Immunity And Indemnification Of Receiver And Assistants

Sec. 21A.014. IMMUNITY AND INDEMNIFICATION OF RECEIVER AND
ASSISTANTS.  (a) For the purposes of this section, the persons
entitled to immunity and indemnification and those entitled to
immunity only, as applicable, are:
	(1)  all present and former receivers responsible for the
conduct of a delinquency proceeding under this chapter;
	(2)  all of the receiver's present and former assistants,
including:
	(A)  all present and former special deputies and assistant
special deputies engaged by contract or otherwise;
	(B)  all persons whom the receiver, special deputies, or
assistant special deputies have employed to assist in a delinquency
proceeding under this chapter;  and
	(C)  any state employees acting with respect to a delinquency
proceeding under this chapter;  and
	(3)  all of the receiver's present and former contractors,
including all persons with whom the receiver, special deputies, or
assistant special deputies have contracted to assist in a
delinquency proceeding under this chapter, including attorneys,
accountants, auditors, actuaries, investment bankers, financial
advisors, and any other professionals or firms who are retained or
contracted with by the receiver as independent contractors and all
employees of the contractors.
	(b)  The receiver, the receiver's assistants, and the
receiver's contractors have immunity under this chapter, as
described by Subsections (c) and (d).
	(c)  The receiver, the receiver's assistants, and the
receiver's contractors are immune from suit and liability, both
personally and in their representative capacities, for any claim
for damage to or loss of property or personal injury or other civil
liability caused by or resulting from any alleged act, error, or
omission of the receiver or any assistant or contractor that arises
out of or by reason of their duties or employment or is taken at the
direction of the receivership court, providing that the alleged
act, error, or omission is performed in good faith.
	(d)  Any immunity granted by this section is in addition to
any immunity granted by other law.
	(e)  The receiver and the receiver's assistants are entitled
to indemnification under this chapter, as described by Subsections
(f)-(l).
	(f)  If any legal action is commenced against the receiver or
any assistant, whether against the receiver or assistant personally
or in their official capacity, alleging property damage, property
loss, personal injury, or other civil liability caused by or
resulting from any alleged act, error, or omission of the receiver
or any assistant arising out of or by reason of their duties or
employment, the receiver and any assistant are indemnified from the
assets of the insurer for all expenses, attorney's fees, judgments,
settlements, decrees, or amounts due and owing or paid in
satisfaction of or incurred in the defense of the legal action,
unless it is determined upon a final adjudication on the merits that
the alleged act, error, or omission of the receiver or assistant
giving rise to the claim:
	(1)  did not arise out of or by reason of their duties or
employment;  or
	(2)  was caused by intentional or wilful and wanton
misconduct.
	(g)  Attorney's fees and any and all related expenses
incurred in defending a legal action for which immunity or
indemnity is available under this section must be paid from the
assets of the insurer, as the fees and expenses are incurred, and in
advance of the final disposition of the legal action upon receipt of
an agreement by or on behalf of the receiver or assistant to repay
the attorney's fees and expenses, if it is ultimately determined
upon a final adjudication on the merits that the receiver or
assistant is not entitled to immunity or indemnity under this
section.
	(h)  Any indemnification for expense payments, judgments,
settlements, decrees, attorney's fees, surety bond premiums, or
other amounts paid or to be paid from the insurer's assets pursuant
to this section are an administrative expense of the insurer.
	(i)  In the event of any actual or threatened litigation
against a receiver or any assistant for whom immunity or indemnity
may be available under this section, a reasonable amount of funds,
which in the judgment of the receiver may be needed to provide
immunity or indemnity, must be segregated and reserved from the
assets of the insurer as security for the payment of indemnity
until:
	(1)  all applicable statutes of limitation have run;
	(2)  all actual or threatened actions against the receiver or
any assistant have been completely and finally resolved;  and
	(3)  all obligations under this section have been satisfied.
	(j)  Instead of segregating and reserving funds under
Subsection (i), the receiver may, in the receiver's discretion,
obtain a surety bond or make other arrangements that will enable the
receiver to secure fully the payment of all obligations under this
section.
	(k)  If any legal action against an assistant for whom
indemnity may be available under this section is settled prior to
final adjudication on the merits, the receiver must pay the
settlement amount on behalf of the assistant, or indemnify the
assistant for the settlement amount, unless the receiver determines
that the claim:
	(1)  did not arise out of or by reason of the assistant's
duties or employment;  or
	(2)  was caused by the intentional or wilful and wanton
misconduct of the assistant.
	(l)  In any legal action in which a claim is asserted against
the receiver, that portion of any settlement relating to the
alleged act, error, or omission of the receiver is subject to the
approval of the receivership court.  The receivership court may not
approve that portion of the settlement if it determines that the
claim:
	(1)  did not arise out of or by reason of the receiver's
duties or employment;  or
	(2)  was caused by the intentional or wilful and wanton
misconduct of the receiver.
	(m)  Nothing contained or implied in this section may operate
or be construed or applied to deprive the receiver, the receiver's
assistants, or receiver's contractors of any immunity, indemnity,
benefits of law, rights, or defense otherwise available.
	(n)  The immunity and indemnification provided to the
receiver's assistants and the immunity provided to the receiver's
contractors under this section do not apply to any action by the
receiver against that person.
	(o)  Subsection (b) applies to any suit based in whole or in
part on any alleged act, error, or omission that takes place on or
after September 1, 2005.
	(p)  Subsections (e)-(l) apply to any suit that is pending on
or filed after September 1, 2005, without regard to when the alleged
act, error, or omission took place.

Added by Acts 2005, 79th Leg., ch. 995, Sec. 1, eff. Sept. 1, 2005.

Last modified: August 11, 2007