SCHEDULE 14PROTECTIVE PROVISIONS

PART 4FOR THE PROTECTION OF NORTHERN POWERGRID (YORKSHIRE) PLC

40.—(1) Subject to sub-paragraphs (2) to (4), if by reason or in consequence of the construction of any of the works referred to in in paragraph 36(2), or in consequence of the, maintenance or failure of any of the authorised works by or on behalf of the undertaker or in consequence of any act or default of the undertaker (or any person employed or authorised by it) in the course of carrying out such works, including without limitation works carried out by the undertaker under this Schedule or any subsidence resulting from any of these works any damage is caused to any apparatus (other than apparatus the repair of which is not reasonably necessary in view of its intended removal for the purposes of those works) or property of Northern Powergrid, or there is any interruption in any service provided by Northern Powergrid, or Northern Powergrid becomes liable to pay any amount to a third party as a consequence of any default, negligence or omission by the undertaker in carrying out the authorised works, the undertaker must—

(a)bear and pay the cost reasonably incurred by Northern Powergrid in making good such damage or restoring the supply; and

(b)indemnify Northern Powergrid for any other expenses, loss, damages, penalty, proceedings, claims or costs incurred by or recovered from Northern Powergrid,

by reason or in consequence of any such damage or interruption or Northern Powergrid becoming liable to any third party and limited to a maximum aggregate liability of the undertaker to Northern Powergrid to the sum total of £50,000,000.00 (fifty million pounds) for all claims arising from this Part of this Schedule.

(2) Nothing in sub-paragraph (1) imposes any liability on the undertaker with respect to—

(a)any damage or interruption to the extent that it is attributable to the act, neglect or default of Northern Powergrid, its officers, employees, servants, contractors or agents; and/or

(b)any authorised development and/or any other works authorised by this Part of this Schedule carried out by Northern Powergrid as an assignee, transferee or lessee of the undertaker with the benefit of the Order subject to the proviso that once such works become apparatus any works yet to be executed by the undertaker and not falling within this paragraph 40(2)(b) will be subject to the full terms of this Part of this Schedule including this paragraph 40 in respect of such new apparatus.

(3) Northern Powergrid must give the undertaker reasonable notice of any such claim or demand and no settlement or compromise is to be made without the consent of the undertaker which, if it withholds such consent, has the sole conduct of any settlement or compromise or of any proceedings necessary to resist the claim or demand.

(4) Northern Powergrid must use its reasonable endeavours to mitigate its losses and to minimise any costs, expenses, loss, demands, and penalties to which the indemnity under this paragraph 40 applies. If requested to do so by the undertaker, Northern Powergrid must provide an explanation of how the claim has been minimised or details to substantiate any cost or compensation claimed pursuant to sub-paragraph (1).The undertaker shall only be liable under this paragraph 40 for claims reasonably incurred by Northern Powergrid.