174.—(1) The undertaker must pay to Peel all reasonable and proper costs, charges, damages and expenses not otherwise provided for in this Part of this Schedule which may be reasonably incurred by Peel —
(a)by reason of the construction, maintenance or operation of a specified work or the failure of such a work; or
(b)by reason of any act or omission of the undertaker or of any person in its employ or of its contractors or others whilst engaged upon a specified work;
(c)in respect of any damage caused to or additional maintenance required to relevant property;
and the undertaker must indemnify and keep indemnified Peel from and against all claims and demands arising out of or in connection with a specified work or any such failure, act or omission provided that the undertaker shall only be liable up to a maximum limit of £20,000,000.
(2) Peel must –
(a)give the undertaker reasonable written notice of any such sums referred to in sub-paragraph (1) as soon as reasonably possible after Peel become aware of the same;
(b)not make any settlement or compromise of such a claim or demand without the prior consent of the undertaker;
(c)take all reasonable steps to mitigate any liabilities; and
(d)keep the undertaker informed and have regard to the undertaker’s representations in relation to any such sums referred to in sub-paragraph (1).