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May 01, 2017

MSC grants leave to consider whether a court must indemnify judges for judgments against them

In Pucci v. Nineteenth Judicial District Court, et al., No. 153893, the Michigan Supreme Court has granted leave to appeal to address a chief judge’s authority to adopt an employee indemnification policy on behalf of the district court.  The Court will also address whether such policies may indemnify employees for liability incurred in their individual capacity. 

As part of a court-wide reorganization, Chief Judge Mark Somers of the Nineteenth District Court terminated Julie Pucci from her position as Deputy County Administrator.  In response, Pucci filed a federal § 1983 action in the United States District Court for the Eastern District against Somers, the City of Dearborn, and the Nineteenth District, alleging in part that Somers wrongfully terminated her position with the court because her domestic relationship with one of the other judges on the court was contrary to Somers’s religious beliefs.  Subsequently, the parties stipulated to dismiss the City of Dearborn from the case, and the Nineteenth District Court and Somers in his official capacity were dismissed on the basis of sovereign immunity.
 
Shortly before the trial on the damage claims against Somers in his personal capacity began, Somers issued an indemnification policy, which provided that the Nineteenth District would indemnify any judgment entered against judges of the court for discretionary administrative decisions within the scope of their authority, including employment and reorganization decisions.  At the conclusion of the trial, the jury returned a verdict of $1,173,125.30 against Somers, concluding that, in his individual capacity, he violated Pucci’s First Amendment right to free speech and procedural due process rights.  Pucci subsequently sought garnishment against the City of Dearborn on the basis of the indemnification policy.  The district court concluded that Pucci must seek remedies against the Court and the City in state court.  Pucci then sought enforcement of the indemnification policy in Wayne County Circuit Court.  The court found that the Nineteenth Judicial District was responsible for the unpaid judgment under a plain reading of the policy. 

The Court of Appeals reversed.  The Court held that while a Chief Judge may adopt an indemnification policy covering court employees and judges while acting in their official capacity, such power does not extend to indemnifying judges for liability incurred in their personal capacity.  Because the federal court judgment in this case was against Somers in his individual rather than official capacity, the indemnification policy was inapplicable and the Nineteenth District could not therefore be liable to Pucci.

In addition to the addressing the issues referenced above, the Michigan Supreme Court also asked the parties to address whether Somers’s conduct occurred while in the course of his employment and while acting in the scope of his authority.  The Court also invited various municipal and judicial associations to file briefs amicus curiae.
 

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