(a) (Returned Asset DLP): Each Returned Asset has a Returned Asset DLP which:
(i) commences on the Date of Returned Works Acceptance relating to that Returned Asset; and
(ii) subject to clause 27.7(c), expires 24 months after the Date of Commercial Acceptance.
(b) (Notification of Defects): If at any time during the relevant Returned Asset DLP:
(i) either party identifies a Defect or possible Defect in a Returned Asset, that party must notify the other party, the relevant Returned Asset Owner and the Independent Reviewer of that Defect; or
(ii) the Independent Reviewer believes there is a Defect or possible Defect in a Returned Asset, the Independent Reviewer will give notice to Project Co, the Returned Asset Owner and the State of that Defect or possible Defect.
(c) (Program): Within 5 Business Days after a notice is provided under clause 27.7(b) notifying Project Co of a Defect, Project Co must submit to the State and the Independent Reviewer, for review in accordance with the Review Procedures, a program for the rectification of the Defect in the Returned Asset, that ensures that the Defect is rectified no later than the end of the relevant Returned Asset DLP.
(d) (Rectification): Project Co must rectify the Defect in the Returned Asset in accordance with the program referred to in clause 27.7(c) to the satisfaction of the Independent Reviewer.
(e) (Extension of Returned Asset DLP): If Project Co is required to rectify a Defect identified during the relevant Returned Asset DLP, the Returned Asset DLP for that part of the Returned Asset which contains the Defect will expire on the later of:
(i) the date which is 24 months after the Date of Commercial Acceptance; and
(ii) the date which is 12 months after the rectification of the Defect.
[Note: The Returned Asset DLP is to be considered on a project specific basis to take into account the staged handover of any Returned Assets. The standard form Project Deed assumes all Returned Assets will be completed by Commercial Acceptance. This may not be the case.]
(f) (No rectification after Returned Asset DLP): Without limiting the State's or the Returned Asset Owners' rights for breach of this Deed or otherwise at Law, Project Co is not required to rectify any Defect in a Returned Asset which is discovered after the end of the relevant Returned Asset DLP.
(g) (Failure to rectify Defect): If the Independent Reviewer determines that Project Co has failed to rectify a Defect in accordance with clause 27.7(d), the State may elect to:
(i) accept or rectify (or engage others to rectify) the relevant Defect in which case the State will notify Project Co and the Independent Reviewer accordingly and may exercise its rights under clause 27.7(i); or
(ii) require Project Co to continue to rectify the Defect.
(h) (Notice to Independent Reviewer): Before the State agrees to accept or rectify any Defect in a Returned Asset in accordance with clause 27.7(g)(i), the State may:
(i) issue a notice to the Independent Reviewer and Project Co requiring the Independent Reviewer to determine within 20 Business Days of its receipt of that notice:
A. the cost necessary to rectify the relevant Defect;
B. any Savings to Project Co as a result of the Defect and not having to rectify the Defect; and
C. the relevant diminution in value of the Returned Asset and any Project Assets as a consequence of the Defect; and
(ii) require Project Co to provide the information referred to in clause 27.6(b)(ii) as if the Defect in the Returned Asset was a Defect in the Works or the Maintained Assets.
(i) (State rectification or acceptance): If the State gives notice under clause 27.7(g)(i):
(i) Project Co must pay the State (as a debt due and payable to the State) the greater of:
A. the costs necessary to rectify that Defect;
B. any Savings to Project Co as a result of the Defect; and
C. the relevant diminution in value of the Project Assets or relevant Returned Assets as a consequence of that Defect,
as determined by the Independent Reviewer in accordance with clause 27.7(h)(i):
(ii) if the State accepts the Defect, the State may impose reasonable conditions on any such acceptance and provide notice of these to Project Co; and
(iii) the State must (acting reasonably) determine and notify Project Co of the changes that will be deemed to be made to this Deed to reflect any acceptance or rectification of the Defect by the State including appropriate amendments to the requirements for Acceptance, Handover and the purposes, functions, uses and requirements set out in the PSDR.
(j) (No other release): Other than to the extent reflected in changes to the Project Deed made in accordance with clause 27.7(i)(iii), no acceptance or rectification of a Defect in the Returned Asset by the State will otherwise relieve Project Co of its obligations and Liabilities, or limit the State's rights, under this Deed or in connection with the Project in respect of the Defect or the events that gave rise to the Defect.
(k) (Retain from Service Payment): If the State requires Project Co to continue to rectify a Defect in accordance with clause 27.7(g)(ii), the State may retain from the Service Payment an amount up to 120% of the greatest of the amounts determined by the Independent Reviewer in accordance with clause 27.7(h)(i) until 10 Business Days after such time as the Defect is rectified by Project Co or the State accepts or rectifies the Defect (including by engaging others to rectify the Defect) in accordance with 27.7(g)(i).
(l) (Rectification): If the State makes any retention under clause 27.7(k), and:
(i) Project Co rectifies the relevant Defect in the Returned Asset, the State must return to Project Co the amount that it has retained in respect of that Defect under clause 27.7(k); or
(ii) the State subsequently accepts or rectifies or engages others to rectify the Defect in the Returned Asset, the State may use the amount retained under clause 27.7(k) to the extent necessary to pay any debt due and payable to the State under clause 27.7(i) and must otherwise pay the remainder of the retention to Project Co.
(m) (No trust): The State:
(i) is not obliged to pay Project Co interest on any amount retained under clause 27.7(k);
(ii) does not hold any amount retained under clause 27.7(k) on trust; and
will be absolutely entitled to any amount retained under clause 27.7(k) for all incomplete or unrectified Defects in a Returned Asset prior to this Deed being terminated in accordance with its terms, subject to paying any Termination Payment payable to Project Co.