Invercargill City Council chief executive Clare Hadley said the decision was made at a meeting on Tuesday, to lay a defence against the mayor after he filed papers earlier this month.
‘"On 6 March 2020, Sir Tim’s lawyers served a statement of claim on council requesting payment of his costs incurred and an indemnity under section 43 of the Local Government Act,’’ Ms Hadley said.
Ms Hadley had confirmed to the Otago Daily Times earlier this month, the amount Sir Shadbolt was seeking was $448,000.The costs related to the successful defence of Sir Shadbolt’s defamation court case against Karen Arnold in 2018.
Ms Arnold alleged Sir Shadbolt and Stuff had defamed her through comments made by Sir Shadbolt in four opinion columns published by The Southland Times newspaper in 2014 and 2015.
Ms Arnold was ordered to pay costs of $186,000 to each party when Justice Denis Clifford found in Sir Shadbolt's and Stuff's favour, however she was subsequently adjudicated bankrupt.
Sir Tim then approached the council to pay for the costs for defending the claims last year however the council and the council’s insurance company declined.
Under section 43 of the Local Government Act 2002, councillors are able to claim indemnity for actions taken on behalf of council in certain circumstances, Ms Hadley said.
''Following the filing of the defence it is expected that the proceedings will follow the normal court processes.''
