1.1  Damage

Without prejudice to the obligations of the Contractor to repair, maintain and replace the [Dwellings/Common Parts/Apartment Blocks] and subject to clause 1.5 (Damage of Minor Nature), as between the Authority and the Contractor:

(a)  the Authority shall only be responsible for the cost of damage to a Site (including the [Dwellings/Common Parts/Apartment Blocks] thereon and the contents of the same) if the Contractor demonstrates to the Authority's satisfaction (acting reasonably) that the damage:

(i)  does not constitute fair wear and tear;

(ii)  does not arise as a result of the damaged item being used for its reasonable and proper purpose in the proper manner or a Site or [a Dwelling/Common Part/Apartment Block] (or any part thereof) being used for its reasonable and proper purpose in the proper manner; and

(iii)  the cost of such damage is either:

(A)  of a value below the level of the deductible of the Required Insurance (up to the maximum deductible specified in the Required Insurances); or

(B)  not covered by the insurances taken out, or which should have been taken out by the Contractor in accordance with this Agreement,

(together Authority Damage)

provided that the Authority shall be liable for any excess or deductible (up to the amount of any maximum deductible specified in the Required Insurances) which is payable as a result of any Authority Damage which has resulted in a Repair Cost being incurred where such Repair Cost has been funded under any such insurance; and

(b)  The Authority shall not have responsibility for the cost of damage pursuant to clause 1.1(a) (Damage) to the extent that the damage was caused by or contributed to by:

(i)  any act or negligence of the Contractor or a Contractor Related Party;

(ii)  any act or negligence of a Tenant; or

(iii)  a breach by the Contractor or a Contractor Related Party of this Agreement (including any failure to monitor or provide the Services).