3526

LAWS OF MARYLAND

[Ch. 852

HE REASONABLY BELIEVED TO BE IN OR NOT OPPOSED TO THE
BEST INTEREST OF THE EMPLOYEES' RETIREMENT SYSTEM, AND
WITH RESPECT TO A CRIMINAL ACTION OR PROCEEDING, HAD
REASONABLE CAUSE TO BELIEVE THAT HIS CONDUCT WAS
UNLAWFUL.

(E) INDEMNIFICATION MAY NOT BE MADE WITH RESPECT
TO ANY SUIT, CLAIM, OR MATTER AS TO WHICH THE PERSON WAS
ADJUDGED TO BE LIABLE FOR NEGLIGENCE OR MISCONDUCT IN THE
PERFORMANCE OF HIS DUTY TO THE EMPLOYEES' RETIREMENT
SYSTEM. THE COURT IN WHICH THE ACTION WAS BROUGHT MAY
DETERMINE, UPON APPLICATION, THAT, DESPITE THE
ADJUDICATION OF LIABILITY, THE PERSON IS FAIRLY AND
REASONABLY ENTITLED TO INDEMNITY FOR THE EXPENSES WHICH
THE COURT SHALL DEEM PROPER.

(F) THE STATE SHALL PROVIDE INSURANCE FOR EVERY
PERSON WHO IS SERVING IN A FIDUCIARY CAPACITY TO THE
EMPLOYEES' RETIREMENT SYSTEM AGAINST ANY LIABILITY
ASSERTED AGAINST HIM OR INCURRED BY HIM ARISING OUT OF
HIS STATUS AS A FIDUCIARY.

SECTION 2. AND BE IT FURTHER ENACTED, That new
Section 196A be and it is hereby added to Article 77 —
Public Education, of the Annotated Code of Maryland (1969
Replacement Volume and 1974 Supplement) to read as
follows:

Article 77 - Public Education

196A.

(A)    THE STATE SHALL INDEMNIFY EVERY PERSON WHO IS
MADE, OR IS THREATENED TO BE MADE, A PARTY TO ANY ACTION,
SUIT, OR PROCEEDING, INCLUDING ADMINISTRATIVE AND
INVESTIGATIVE PROCEEDINGS BY REASON OF HIS SERVICE IN A
FIDUCIARY CAPACITY TO THE TEACHERS' RETIREMENT SYSTEM, IN
ACCORDANCE WITH AND SUBJECT TO THE CONDITIONS STATED IN
THIS SECTION.

(B)    THE TERM "SERVICE IN A FIDUCIARY CAPACITY," AS
USED IN THIS SECTION, MEANS THE EXERCISE OF ANY
DISCRETIONARY AUTHORITY OR CONTROL CONCERNING THE
MANAGEMENT OR ADMINISTRATION OF THE TEACHERS' RETIREMENT
SYSTEM, OR THE EXERCISE OF ANY DISCRETIONARY AUTHORITY OR
CONTROL CONCERNING THE MANAGEMENT OR DISPOSITION OF THE
ASSETS OF THE SYSTEM. IT INCLUDES MEMBERSHIP ON THE
BOARD OF TRUSTEES OF THE TEACHERS' RETIREMENT SYSTEM,
MEMBERSHIP ON THE ADVISORY INVESTMENT COMMITTEE AND
SERVICE AS INVESTMENT ADMINISTRATOR OR ON HIS STAFF.

(C)    IF, WITH RESPECT TO A CIVIL, ADMINISTRATIVE,
OR INVESTIGATIVE ACTION, SUIT, OR PROCEEDING, THE PERSON