It is also intended that this policy will ensure good communication between the members of MVRMA's "defense team" so that an effective and proactive defense can be provided for each suit presented to MVRMA. It is also expected that this policy will provide for an expedient, efficient, cost-effective, and just disposition of each case.

ROLE OF THE MEMBER MUNICIPALITY

In accordance with MVRMA's Claims Reporting Procedure, each MVRMA member is responsible for communicating service of a lawsuit to the MVRMA Claims Manager or the MVRMA Executive Director within forty-eight (48) hours of receipt. Once defense counsel has been assigned, the member municipality shall cooperate fully with MVRMA and its representatives/service providers through final disposition of the suit.

Upon receipt of each claim, the Claims Manager shall complete an investigation to evaluate the member's exposure and establish an adequate reserve for the claim. Thereafter, the Claims Manager shall promptly pursue resolution of the claim by either recommending a settlement or a denial of the claim. If the Claims Manager is unable to develop all necessary information to make such a recommendation, he/she may seek authorization from the MVRMA Executive Director to engage adjusters, third-party investigators, attorneys, or other professionals to conduct further investigation, as necessary.

The Claims Manager is responsible for initiating all reasonable actions needed to control the cost of each claim presented against MVRMA and its members. The Claims Manager shall, therefore, be vigilant of situations which may lead to suit and may make recommendations to the MVRMA member and MVRMA Executive Director to settle potential suits preemptively. He/She shall negotiate and equitably settle claims as circumstances allow. This shall be done by direct communication with the claimant or his/her legal representative(s) after authorization from the MVRMA Executive Director. The Claims Manager shall keep the MVRMA Executive Director apprised of the status of all such negotiations.

ROLE OF THE CLAIMS ADMINISTRATOR (Post-Suit)

If reasonable settlement is not possible (or in the event that the Claims Manager lacked prior knowledge of circumstance which might lead to a suit) and suit is filed, the Claims Manager shall, within 72 hours of first notice of the suit, communicate with the MVRMA Executive Director to ensure that he/she is aware of the litigation. The Claims Manager shall also review the loss reserve for the prior claim and adjust it as necessary (or establish a loss reserve for the new suit, if no prior claim had been submitted) to ensure that an adequate reserve, including loss adjustment expenses, is always in place.

Following the assignment of defense counsel, the Claims Manager shall assist in further investigation or information gathering as directed by defense counsel. As circumstances warrant, the Claims Manager may be directed by defense counsel to engage in negotiations with the claimant or plaintiff's counsel.

The Claims Manager shall maintain a "Suit Log" of all suits noting the parties to the litigation, assigning a MVRMA claim number, noting the loss year  to which the claim has been assigned, noting the filing date of the suit and its receipt date by the MVRMA member, noting the attorney to which the suit was assigned and the date of assignment, and noting the date  and nature of any Reservation of Rights or Coverage Denial letters communicated to the member by MVRMA.

In addition, the Claims Manager shall be responsible for reviewing all statements for attorneys' fees and third-party bills submitted in connection with pre- or post-suit litigation activities.

ROLE OF THE DEFENSE COUNSEL

The attorney(s) representing MVRMA in a lawsuit owe(s) the MVRMA member the highest degree of professional care and good faith during the period of his/her representation. Defense counsel shall abide by the Code of Professional Responsibility and by the rules of the Bar to which counsel is admitted. MVRMA's contractual duty to provide a defense to the member also encompasses the expectation that defense counsel shall take whatever measures are prudent or necessary to avoid or limit liability and to aid in the narrowing or avoidance of damages. Counsel shall ensure that it has no conflict of interest in representing MVRMA or its member municipality and shall deliver to MVRMA acceptance or denial of the assignment, in writing, within 48 hours.

MVRMA expects an aggressive approach to each case. Generally, an aggressive gathering of information by the attorney, working with the Executive Director, Claims Manager or other approved service providers, and the member will aid the goal of a prompt and efficient disposition to each suit. Part of the information gathering process shall include a requirement that plaintiff's counsel be contacted by defense counsel within thirty (30) business days of the assignment to determine the specific demands and conditions which the plaintiff is seeking and whether a settlement is possible. Upon receipt, this information shall be conveyed, in writing, to the Claims Manager. Defense counsel shall also seek voluntary cooperation from the member and plaintiff's counsel so that essential facts and discovery can be exchanged informally and promptly. Important evidence should be obtained promptly through the most efficient and cost-effective means possible.

These guidelines notwithstanding, it is essential that the effort of counsel be in proportion to the seriousness of the matter in question and that counsel confer as needed with the Executive Director or Claims Manager and/or the member municipality to determine how to bring each case to a conclusion. Neither MVRMA nor its members are well served by exorbitant costs incurred in an easily-defensible matter.

REPORTING REQUIREMENTS FOR ATTORNEYS

So as to reduce the amount of paper, the attorney(s) will only provide substantive information and copies of materials filed with the court. They will not provide copies of cover letters, letters arranging meetings or depositions or blank copies of interrogatories, requests for production of documents or other discovery demands. Additionally, they will not provide answered interrogatories or documents produced unless they believe the information is significant to MVRMA's understanding and evaluation of the claim.

In regard to depositions, they will not order any transcripts without a specific purpose such as supporting a motion for summary judgment or preparing for trial. They will, however, provide MVRMA with a summary of any deposition, which summary shall not exceed two pages.

Not later than January 15th, April 15th, July 15th, and October 15th, of each year, all attorneys working on active suits shall provide written Suit Assessments (as prescribed by MVRMA), including legal fee budgets, to the Claims Manager, for each suit assigned to the attorney. The basis for evaluating claims shall be on a "most likely scenario" basis rather than a "worst possible scenario" basis. The budgets shall be based upon work anticipated prospectively to the expected conclusion of the litigation. In addition to these quarterly reports, an updated Suit Assessment report shall be provided to the Claims Manager at least thirty (30) days before any trial is scheduled to begin in accordance with any requirements of MVRMA's excess carriers.

Finally, all MVRMA defense counsel shall provide written reports summarizing the status of their MVRMA caseload to the MVRMA Executive Director by the first Friday of March, June, September and December so that this information can be included in agenda packets for the MVRMA Board Meetings held those months.

BILLING GUIDELINES FOR ATTORNEYS' FEES

Statements for legal services shall comply with the approved fee schedule in each engagement agreement with MVRMA. Statements shall be submitted quarterly and paid within thirty (30) days of receipt. Interim statements for expenses exceeding $500 may also be submitted and paid in like fashion.

All statements shall be itemized in 1/10 of an hour increments, based upon contemporaneous time records. MVRMA shall not accept any block billings or minimum/standard billing charges. The date, description of the service rendered, time and fees charged per task, and identity of the person providing the service (along with his/her hourly rate) shall be provided for each entry. Detailed documentation shall also be provided for out-of-pocket expenses and disbursements incurred in MVRMA's behalf, including expenses to engage consultants and expert witnesses approved by the Executive Director.

Each statement will summarize, for each file, current period services provided and cumulative fees and expenses paid to date from the inception of the legal activities. A summary of each biller's work on the file shall also be provided.

The Claims Manager shall review all statements for services rendered and make inquiries on any questionable items to the attorney and, if necessary to the Executive Director. Items still in question shall be brought back to the firm by the Executive Director for further explanation prior to payment authorization.

All work shall be performed and billed at its appropriate level of legal complexity and skill level. Paralegal work is still paralegal work, whether performed by a partner, associate, or paralegal, and shall be billed accordingly. In addition, MVRMA will only pay for tasks which are necessary for the case.

In addition to the limitations placed on billings listed above, MVRMA shall not pay for services not ordered or not needed, for services not received, for depositions, engagements of experts, or legal research not authorized by the Executive Director, nor for services which are below specifications.

ROLE OF THE EXECUTIVE DIRECTOR

The Executive Director shall be responsible for the selection and assignment of defense counsel in all suits, in accordance with the MVRMA bylaws and policies established by the MVRMA Board.  The Executive Director upon receipt of a suit shall review it and determine whether or not coverage is appropriate through MVRMA.  If the suit constitutes a valid claim he shall assign defense counsel within a seventy-two (72) hour period.  The Claims Manager shall then communicate all defense counsel assignments, in writing, to the member municipality and assigned counsel.    If the suit does not constitute a valid claim, he shall communicate this information to the member municipality in writing, also within a seventy-two (72) hour period.  A member has the right to dispute the decision to deny coverage in accordance with the MVRMA bylaws and MVRMA's Dispute Resolution Policy.

In assigning counsel the Executive Director may generally assign suits only to those firms previously certified and engaged to do work for MVRMA by the MVRMA Board. However, in unusual circumstances where due to the complexity of the litigation, the need for multiple defense counsel assignments or the existence of conflicts of interest which would preclude all certified and previously engaged firms from accepting a defense assignment, the Executive Director may choose other qualified counsel, on an ad hoc basis, to best represent the member municipality.

The Executive Director shall be responsible for monitoring the progress of all litigation matters, as well as the loss adjustment expenses, including attorneys fees, of each suit and the performance of the service providers. At least every six months, the Executive Director, the Claims Manager and the attorneys assigned to defend MVRMA suits shall meet to discuss all matters of open or pending litigation, to ensure that a strategy of defense has been laid out for each suit, that reserves are adequate, and that there is good communication within the defense team.

The Executive Director shall be responsible for evaluating the general performance of counsel and the Claims Manager on not less than an annual basis, and shall also be responsible for negotiating any contractual agreements or amendments with said service providers as directed or authorized by the MVRMA Board.

At each regularly scheduled Board Meeting, a report will be presented to the Board for each pending claim for which a reserve amount greater than $25,000 has been set.  Approval of this report shall constitute advance notice under the MVRMA Bylaws of a possible settlement in excess of $25,000 and shall constitute sufficient authority to permit the Executive Director or his designee to settle a claim or suit for an amount up to the reserve amount for said claim or suit.