The University may incur financial obligations or receive payments as a result of litigation. For judgments and settlements covered by insurance, any financial obligations will be handled under an insurance principle with the applicable annual premium spread across all units in the University. A deductible amount up to $10,000 will generally be the responsibility of the Resource Responsibility Center (RRC) from which the litigation originated. Additional settlement amounts in excess of the deductible paid by the RRC will be paid by the University's insurance programs. For judgments and settlements not covered by insurance, the responsibility for payment will be determined by the President, Provost, Chief Financial Officer, and responsible dean, vice president, or chancellor.
Payments received, up to the amount of loss incurred, will generally be returned to the unit from which the claims or litigation originated unless previously restored. Payments will be reduced by the costs incurred for outside counsel, fees and expenses. Amounts received in excess of the actual loss and litigation expenses will be deposited to the central holding account managed by University Budget and Finance.
Any remaining allocation of obligations and payments will be decided by the Chief Financial Officer with agreement by the Executive Vice President and Provost or designee. These decisions should be fair and equitable while taking into consideration the financial impact, the unit's responsibility, and factors outside the unit's control. Allocations will be made to the RRC.
Reason for Policy
To provide fair and equitable allocation of the obligations and payments made or received from litigation.