N.Y. TWN Law § 65

§ 65. Actions and proceedings by and against towns. 1. Any action or\nspecial proceeding for or against a town, or for its benefit, and upon a\ncontract lawfully made with it, or with any of its officers or agents\nauthorized to contract in its behalf, or to enforce any liability\ncreated, or duly enjoined upon it, or upon any of its officers or agents\nfor which it is liable, or to recover damages for any injury to any\nproperty or rights for which it is liable, shall be in the name of the\ntown. The town board of any town may authorize and direct any town\nofficer or officers to institute, defend or appear, in any action or\nlegal proceeding, in the name of the town, as in its judgment may be\nnecessary, for the benefit or protection of the town, in any of its\nrights or property. It shall be the duty of any officer or officers so\nauthorized and directed to institute said action or legal proceeding or\nto defend or appear therein, and the reasonable and necessary expense of\nsuch action or proceeding, or defense or appearance shall be a town\ncharge. No such officer or officers, however, shall employ legal counsel\nexcept as directed by the town board.\n 2. The town may sue and be sued at law for the breach of any lawful\ncontract entered into by it on behalf of a district wholly located in\nsuch town. Any sum of money recovered by it in such an action shall be\npaid over to the town treasury and be credited to such district. In the\nevent of the entry of any judgment against such town by reason of a\ncontract made on behalf of a district, the town shall forthwith satisfy\nand pay such judgment, interest and costs, and the amount so paid in\nsatisfaction of any such judgment, interest and costs shall be a charge\nagainst such district and the amount thereof shall be assessed and\nlevied against and collected from the several lots and parcels of land\nwithin the district in the same manner as other district charges, or the\namount of any such judgment, including interest and costs, may be\nfinanced pursuant to the local finance law in which event amounts\nnecessary to provide for the annual payments of principal of and\ninterest on any obligations issued by the town for such purpose shall be\nassessed and levied against and collected from the several lots and\nparcels of land within the district in the same manner as other district\ncharges.\n 3. On and after the first day of September, nineteen hundred\nthirty-nine, no action shall be maintained against a town upon or\narising out of a contract entered into by the town unless the same shall\nbe commenced within eighteen months after the cause of action thereof\nshall have accrued, nor unless a written verified claim shall have been\nfiled with the town clerk within six months after the cause of action\nshall have accrued, but no such action shall be brought upon any such\nclaim until forty days have elapsed after the filing of the claim in the\noffice of the town clerk.\n