(a) (Payment Schedule applies): The Service Payments may be Abated by the State to the extent and in the manner described in the Payment Schedule to reflect the agreed principle that the State must only pay for the quantum, quality and availability of the Services actually provided.
(b) (Not to affect other rights): Subject to clauses 34.2(c) and 34.2(e), adjustment of the Service Payments in accordance with the Payment Schedule under clause 34.2(a) will be the only financial liability that Project Co will have to the State for a Performance Failure.
(c) (No limit): Clause 34.2(b) does not limit or affect:
(i) Project Co's Liability under clause 27.6(c) for the rectification or acceptance of Defects;
(ii) the State's rights under this Deed or any other State Project Document in respect of the event that caused or contributed to the Performance Failure (as opposed to the Performance Failure itself);
(iii) any other right or remedy of the State under this Deed or any other State Project Document or at Law (other than for monetary compensation for a Performance Failure);
(iv) the State's rights under clauses 42, 45 and 46;
(v) subject to clause 38.5(a)(iv), any entitlement of the State to recover any Liabilities suffered or incurred by the State as a consequence of exercising its rights under clause 38;
(vi) any payment on termination of this Deed (including a Termination Payment);
(vii) any Liability that Project Co may have for costs, losses, damage, destruction or other amounts which are indemnified by Project Co under clause 43.1 to the extent that the State has not been fully compensated for that Liability by the adjustment under clause 34.2(a);
(viii) any Liability that Project Co has to the State for any Liability that the State has to a third party, to the extent that the State has not been fully compensated for that Liability by the adjustment under clause 34.2(a); or
(ix) any Liability that Project Co may have for a Liability (including reasonably foreseeable economic loss) suffered or incurred by the State as a result of any:
A. fraudulent, reckless, unlawful or malicious act or omission; or
by Project Co or any Project Co Associate to the extent that the State has not been fully compensated for that Liability by the adjustment under clause 34.2(a).
(d) (Abatement): Project Co acknowledges and agrees that:
(i) it is difficult, and in some instances impossible, to calculate with precision the diminution in value the State may suffer in connection with each Performance Failure;
(ii) notwithstanding clause 34.2(d)(i), the application and escalation of the Abatements in accordance with the Payment Schedule associated with each Performance Failure:
A. reflects a genuine pre-estimate of, and is proportionate to, the diminution in value (including having regard to associated mitigation and other costs) to the State in connection with each Performance Failure; and
B. has been agreed to protect the legitimate interests of the State in the performance of the Services in accordance with the requirements of this Deed, which include:
[Note: General interests of the State are to be included on a project specific basis. The interests should be drafted in general terms and on a non-exhaustive basis];
(iii) both the State and Project Co require a formula for calculation of the diminution in value the State may suffer in connection with each Performance Failure that is able to be readily applied without unnecessary administrative costs, delay or difficulty;
(iv) to the extent it is legally permitted to so agree, it will not assert in any proceedings under clauses 48 to 50 or in any court or other proceedings that the Abatements provided for in this clause 34 and the Payment Schedule are exorbitant, extravagant or unconscionable or a penalty or that the clause or any adjustment under the Payment Schedule in respect of an Abatement is void or unenforceable (whether in whole or in part); and
(v) the State has entered into this Deed on the basis of and in reliance on the acknowledgements given by Project Co in this clause 34.2(d).
(e) (Project Co acknowledgements): Project Co acknowledges and agrees that if the Abatement of the Service Payment in accordance with clause 34.2(a) is held to be void or unenforceable, clause 34.2(b) and the Payment Schedule will not limit Project Co's Liability to the State under this Deed or otherwise at Law for any Liability suffered or incurred by the State as a consequence of or in connection with a Performance Failure.
(f) (Unilateral waiver): The State may waive any Abatement (in whole or in part) at any time and from time to time, by notice to Project Co. No waiver of an Abatement:
(i) constitutes acceptance by the State of the Performance Failure giving rise to the Abatement;
(ii) operates as a waiver of another Performance Failure giving rise to an Abatement; or
(iii) prejudices any rights or powers of the State or the State Representative.