The indemnification and defense obligations set forth in this section shall not apply to proceedings initiated by the town to procure a judgment against any person in the town's favor unless a determination is made pursuant to § 32.63 that the requirements of this section have been met. Notwithstanding anything else set forth in this section, if a court enters a judgment that the person's actions exceeded his or her authority, such person shall reimburse the town for all costs incurred by it in providing the indemnification and/or defense of the proceeding.