HomeMy WebLinkAboutCC 12-07-2010 Liability Coverage & Tort Liability Waiver
MAYOR & COUNCIL COMMUNICATION
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DATE: 12/07/2010
Consent ITEM #: 4 MOTION as part of the Consent Agenda AGENDA ITEM: Approve Liability Coverage and Monetary Tort Liability Waiver SUBMITTED BY: Tom Bouthilet, Finance Director THROUGH: Bruce Messelt, City Administrator
REVIEWED BY: Joe Rigdon, KDV Dave Snyder, City Attorney
SUMMARY AND ACTION REQUESTED: The City Council is respectfully requested to
approve the Liability Coverage Waiver Form, stating the City does not waive the monetary limits on municipal tort liability. No specific motion is needed, as this is recommended to be part of the overall approval of the Consent Agenda. BACK GROUND INFORMATION: The City of Lake Elmo obtains liability coverage through The League of Minnesota Cities Insurance Trust for buildings and vehicles. The coverage also includes tort liability. Because of this coverage, the City must decide whether or not to waive the monetary limits on municipal tort liability. as established by Minnesota Statutes §466.04.
STAFF REPORT: If the City does not waive the statutory tort limits, an individual claimant would be able to recover no more than $500,000 on any claim to which the statutory tort limits apply. The total which all claimants would be able to recover for a single occurrence to which the
statutory tort limits apply would be limited to $1,500,000. These statutory tort limits would apply
regardless of whether or not the City purchases the optional excess liability coverage. If the City waives the statutory tort limits, and does not purchase excess liability coverage, a single claimant could potentially recover up to $1,500,000 on a single occurrence. The total which
all claimants would be able to recover for a single occurrence to which the statutory limits apply
would also be limited to $1,500,000, regardless of the number of claimants. If the City waives the statutory tort limits and purchases excess liability coverage, a single claimant could potentially recover an amount up to the limit of the coverage purchased. The total
which all claimants would be able to recover for a single occurrence to which the statutory tort
City Council Meeting Liability Coverage and Monetary Tort Liability Waiver
December 7th, 2010 Consent Agenda Item # 4
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limits apply would also be limited to the amount of coverage purchased, regardless of the number of
claimants.
RECOMMENDATION: Based upon the above background information and staff report, it is
respectfully recommended that the City Council approve as part of tonight’s Consent Agenda the liability coverage-waiver form, stating that the City-does not waive the monetary limits on municipal tort liability as established under Minnesota Statues 466.04. Alternatively, the City Council does have the authority to remove this item from the Consent
Agenda and further discuss and deliberate prior to taking action. While tabling this item is not recommended (at least not beyond the planned December 14th meeting), the Council may elect to amend the recommended motion to one of the alternatives presented. If done so, the appropriate action of the Council following such discussion would be:
“Move to approve Liability Coverage and [waive/not waive] the statutory tort limits [with
or without purchase of additional coverage], as discussed at tonight’s meeting”. ATTACHMENTS:
1. Liability Coverage Waiver Form SUGGESTED ORDER OF BUSINESS (if removed from the Consent Agenda):
- Questions from Council to Staff ............................................. Mayor Facilitates
- Call for Motion ............................................................... Mayor & City Council
- Discussion ....................................................................... Mayor & City Council
- Action on Motion .................................................................... Mayor Facilitates