FINANCE AND COMMERCE APPELLATE COURTS EDMON
<br />e, Which constitutes dishonesty on the part of a "covered party;" or
<br />`f. Which constitutes the willful violation of a statute or ordinance by any
<br />f6cial, employee, or agent of the "city."
<br />'The terms "malfeasance," "willful neglect of duty," and "bad faith"
<br />shall be given the same meaning in this covenant as given in the
<br />applicable statute with respect to the "city's" duty to defend or
<br />indemnify its official, employees or agents.
<br />The coverage afforded by the covenant thus parallels the city's
<br />statutory duty and authority to defend and to reimburse; and, be-
<br />cause the city may (under our holding in part II) reimburse
<br />appellants' defense costs pursuant to section 465.76, we conclude
<br />that MLCIT has a concomitant duty under the covenant to reimburse
<br />appellants for the costs and attorney fees they incurred in defense
<br />of the Thuma action (in the absence of malfeasance, etc.).
<br />We note, however, that MLCIT does not have a duty to indemnify
<br />for the $100 penalties imposed against each appellant because the
<br />policy specifically excludes coverage for "fines or penalties Im-
<br />posed by law.", Furthermore, In addition to the exclusion in the
<br />covenant, the open meeting law explicitly calls for "personal
<br />liability" for the $100 civil penalty. Minn. Stat. § 471.705, subd. I
<br />IV:
<br />The trial court granted attorney fees in the amount of $500 for
<br />each respondent. The district court has broad discretion in awarding
<br />,fees. Solon v. Soloa, 255 N.W,2d 395, 397 (1977). Appellants do
<br />not dispute that respondents had to appear twice due to appellant's
<br />actions. We find no abuse of the trial court's discretion in awarding
<br />attorney fees to respondents under these circumstances,
<br />DECISION
<br />The city does not have a duty to defend and reimburse under Minn.
<br />Stat. § 466.07 (1990) for costs and attorney fees incurred by appel-
<br />lants In their defense of the Thuma action. The city may, however,
<br />)under Minn. Star, § 465.76 (1990), provide reimbursement for
<br />attorney fees and other defense costs. Because less than a quorum
<br />of the city council is disinterested in this matter, approval of any
<br />reimbursement decision must be sought from a district court.,
<br />Under the terms of the covenant issued by MLCIT to the city,
<br />MLC1T has a duty to defend and, therefore, to reimburse for the cost
<br />of defending. Finally, the trial court did not abuse its discretion in
<br />awarding attorney fees in the amount of $500 to each respondent.
<br />Affirmed in -part, reversed In part, and remanded.
<br />Blue Earth County
<br />Lansing, Judge
<br />District Court rlCX911921
<br />Willard T. Dorn, et. al„
<br />Michael D. Schwartz
<br />David E. Wandling
<br />Appellants,
<br />Michael D. Schwartz, P.A.
<br />Suite 230
<br />12900 Whitewater Drive
<br />Minneapolis, MN 55343
<br />VS.
<br />John Peterson, Individually
<br />Bailey W. Blethen
<br />and in his capacity as an -
<br />- Blelhen, Gage & Krause
<br />Employee of H & C Electric
<br />127 South Second Street
<br />Supply Company, et, al.,
<br />P.O. Box 3049
<br />Mankato, MN 56001
<br />Respondents.
<br />Filed: March 8,1994
<br />Office of Appellate Courts
<br />SYLLABUS
<br />I, There is no age ceiling on the Minnesota Human Rights Act's
<br />MARCH 11, 1994
<br />prohibition against discharge based on age, but the Act permits an
<br />exemption for a mandatory retirement age established by law or an
<br />employer's published retirement policy if it is established consistent
<br />with Minn. Stat. § 181.81 (1990).
<br />II. An employer's statement to the Department of Jobs and
<br />Training in response to an employee's claim for unemployment
<br />benefits is absolutely privileged and cannot be the basis for a
<br />defamation action both because the response is an integral part of a
<br />quasi-judicial proceeding and because the response is required by
<br />statute.
<br />. Affirmed in part and reversed In part.
<br />Considered and decided by Norton, Presiding Judge, Lansing,
<br />Judge, Forsberg, Judge.
<br />OPINION
<br />LANSING, Judge (Hon. James D. Mason, District Court Trial
<br />Judge)
<br />This appeal raises the question of whether the Minnesota Human
<br />Rights Act protects employees seventy years of age and older
<br />against discharge based on age. We hold that Minn. Stat. § 363,03,
<br />subd. I (2)(b) (1990) prohibits discharge based on agewith no upper
<br />age limit, but Minn. Stat. § 363.02, subd. 6 (1990)allows an exemp-
<br />tion for a mandatory retirement age to be established by law or by
<br />an employer's published retirement policy if it is established con-
<br />sistent with Minn, Star. § 181.81 (1990). This appeal also requires
<br />us to determine whether an employer's submission to the Depart-
<br />ment of Jobs and Training of reasons for discharge Is absolutely or
<br />qualifiedly privileged for purposes of a defamation action. We
<br />conclude that within the context of the unemployment compensa-
<br />tion claim procedure, an employer's statement of reasons for dis-
<br />charge is absolutely privileged.
<br />FACTS.
<br />H & C Electric Supply Company employed Willard Dorn from
<br />1960 to 1991 and John Hoerr from 1980 to 1991. Both employees
<br />were discharged in 1991 by John Peterson, general manager for
<br />H & C Electric. At the time of discharge Dorn was seventy-nine
<br />years old and Hoerr was seventy-eight years old. H & C Electric
<br />did not have a mandatory retirement policy. Peterson stated that
<br />Dom and Hoerr were discharged for deficient performance. Dom
<br />and Hoerr claim that Peterson told them that the discharge was
<br />because of their age.
<br />Both Dom and Hoerr applied for unemployment benefits. Peter-
<br />son,. in response to an inquiryfrom the Department of Jobs and
<br />Training, wrote a letter saying that he had terminated Hoerr so other
<br />more qualified employees could advance, that Hoerr's termination
<br />had nothing to do with his age, that Hoerr had difficulty using H &
<br />C Electrie's computer system, and that Hoerr had held his position
<br />as buyer because of H & C Electric's prior owners. Peterson wrote
<br />a separate letter stating that Dom was terminated because his
<br />,productivity had decreased over the past eight to ten years, that Dorn
<br />could not provide some services other buyers could, and that he, like
<br />Hoerr, had kept his job because of his personal relationship with the
<br />prior owners, Audrey Roden, Peterson's secretary, typed the letters,
<br />and Bob Stark, H & C Electric's plant manager, knew the letters'
<br />contents.
<br />Dom and Hoerr brought this action claiming (1) age discrimina-
<br />tion under Minn. Star. § 363.03, subd. 1 (2)(b) (1990), and (2)
<br />defamation based on Peterson's statements to the Department of
<br />Jobs and Training. The district court held that Dorn and Hoerr were
<br />not protected from age discrimination under the Minnesota Human
<br />Rights Act and that Peterson's statements were privileged. The
<br />district court entered summary judgment against Dorn and Hoerr
<br />and they appeal.
<br />ISSUES
<br />I. Does Minn. Stat. § 363.03, subd, 1 (2)(b) (1990) protect
<br />employees seventy years of age or older from discharge based on
<br />age?
<br />IL Is an employer's response' to a specific inquiry from the
<br />Department of Jobs and Training relating to an employee's claim
<br />for unemployment benefits protected by absolute or qualified
<br />
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