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WESTMORELAND-LG&E PARTNERS v. VIRGINIA ELECTRIC AND POWER COMPANY


WESTMORELAND-LG&E
PARTNERS

v.

VIRGINIA ELECTRIC AND
POWER COMPANY


June 6, 1997
Record No. 961410

WESTMORELAND-LG&E PARTNERS

v.

VIRGINIA ELECTRIC AND POWER COMPANY

OPINION BY CHIEF JUSTICE HARRY L. CARRICO
FROM THE CIRCUIT COURT OF THE CITY OF RICHMOND

Melvin R. Hughes, Jr., Judge
Present: All the Justices


In an amended motion for judgment, Westmoreland-LG&E
Partners (Westmoreland) sought to recover from Virginia Electric
and Power Company (Virginia Power) damages resulting from
Virginia Power’s alleged breach of a "Power Purchase and
Operating Agreement" (the Contract). Westmoreland appeals
from the award of summary judgment in Virginia Power’s favor and
the dismissal of Westmoreland’s action with prejudice.

Westmoreland makes three complaints on appeal. First,
Westmoreland says the trial court erred in holding that evidence
of trade custom and usage would not be permitted to explain the
meaning of certain contractual terms. Second, Westmoreland
contends the Contract is ambiguous and that the trial court erred
in ruling that parol evidence would not be allowed to show the
parties’ intent and understanding with respect to certain of the
Contract’s payment provisions. Third, relative to an alternative
basis for recovery, Westmoreland maintains the trial court erred
in failing to recognize that certain contractual language might
entitle Westmoreland to at least a partial recovery for Virginia
Power’s alleged breach of the Contract.

The facts are not in dispute. Westmoreland, a Virginia general
partnership composed of Westmoreland Roanoke Valley, L.P. and
LG&E Roanoke Valley, L.P., is an independent power producer.
Virginia Power is a public utility providing electrical service
to its customers.

In the late 1970s, Virginia Power began purchasing electricity
from independent power producers. In 1988, Virginia Power issued
a request for proposals from a number of independent power
producers, including Westmoreland, for the supply of electricity
to Virginia Power. A model contract prepared by Virginia Power
accompanied the request for proposals.

Westmoreland responded with a proposal, which Virginia Power
accepted, and the two parties entered into the Contract on
January 24, 1989.[1]
On or about the same date, Virginia Power entered into agreements
with approximately twenty other independent power producers as a
result of its request for proposals.

In order to fulfill its obligations under the Contract,
Westmoreland constructed a $300 million power plant, known as
"ROVA I" (the Facility), near Roanoke Rapids, North
Carolina.[2]
The plant commenced commercial operations in May 1994 with the
capacity to produce approximately 150 megawatts of electricity.
Westmoreland is obligated under the Contract to supply this
capacity to Virginia Power upon demand for a term of twenty-five
years.

In the Contract, Westmoreland agrees to sell and Virginia
Power agrees to purchase "the Net Electrical Output of the
Facility." Also, Westmoreland agrees to sell and Virginia
Power agrees to purchase "Dependable Capacity from the
Facility." "Net Electrical Output" is defined in
the Contract as "[a]ll of the Facility’s generating output
made available for sale." "Dependable Capacity" is
defined as "[t]he amount of capacity set by [Westmoreland
based upon prescribed tests] and delivered from the
Facility" to Virginia Power.

Under the Contract, Westmoreland must "control and
operate the Facility consistent with [Virginia] Power’s Dispatch
of the Facility." "Dispatch" is defined in the
Contract as "[t]he right of [Virginia] Power . . .
to schedule and control . . . the generating level of
the Facility in order to commence, increase, decrease, or cease
the delivery of Net Electrical Output" to Virginia Power.
When Virginia Power dispatches the Facility by providing notice
to Westmoreland of the estimated needs for the following week,
Westmoreland must comply with the notice.

Virginia Power is obligated by the Contract to make two types
of payments to Westmoreland, one for net electrical output,
termed "Energy Payments," and the other for dependable
capacity, termed "Capacity Payments," based upon the
different types of costs incurred by Westmoreland. Energy
Payments are designed to compensate Westmoreland for the actual
amount of electricity it generates and delivers to Virginia Power
and to reimburse Westmoreland for its variable costs incurred to
produce the electricity.

Energy Payments are not in dispute here, but Capacity Payments
are. Capacity Payments are designed to compensate Westmoreland
for the costs it incurred in constructing the Facility and for
the fixed costs it incurs in operating and maintaining the
Facility.

Under ? 10.15(a) of the Contract, Virginia Power is
required to make Capacity Payments in a fixed amount for a
25-year term, "so long as the plant is available as required
by the Contract." Although paid monthly, the Capacity
Payment is calculated at the rate of approximately $200,000 per
day.

The present controversy arose when Virginia Power withheld
Capacity Payments for each day it deemed to be a "Forced
Outage Day" within the meaning of the Contract. In its
amended motion for judgment, Westmoreland sought recovery for the
total amount withheld by Virginia Power.

Section 1.18 of the Contract defines a "Forced
Outage" as "[a]n interruption . . . of the
Facility’s delivery of the Net Electrical Output [that] is not
. . . the result of a Scheduled Outage."[3]
Section 1.20 defines a "Forced Outage Day" as

[e]ach continuous twenty-four (24) hour period beginning
with the start of a Forced Outage (regardless of the number
of actual outages that may occur during such twenty-four (24)
hour period(s))

(a) designated by [Westmoreland] as a Forced Outage Day,

(b) a Forced Outage Day which is determined pursuant to
Section 10.15(d).

Section 10.15(d) forms the entire basis of Virginia Power’s
defense in this case. It is a unique section, found only in the
contract involved here and not in the agreements Virginia Power
executed with other independent power producers at or about the
same time.[4]
Section 10.15(d) provides as follows:

For each instance where [Westmoreland] fails, after the
second oral notification (such notification shall not be less
than fifteen (15) minutes from the first notification) from
[Virginia] Power, to maintain the operating level specified
by [Virginia] Power pursuant to Section 7.6, to within +
five (5%) percent of the Dispatched level then for each
percent or portion of a percent deviation from the above
allowed + five (5%) percent, then at [Virginia] Power’s option, the payment for that Day’s Dependable
Capacity shall be reduced two (2%) percent. If such deviation
reduces that Day’s payment for Dependable Capacity to zero
(0) then that Day shall be a Forced Outage Day. Example: If
the Facility is Dispatched at 100MW but is only able to
deliver 87MW then the payment for Dependable Capacity for
that Day would be reduced by 16%.

Because, under ? 10.15(d), the 2% reduced payment scale
applies to each percent of deviation from the dispatched level,
or portion thereof, the reduction in the capacity payment reaches
100% and a Forced Outage Day occurs on any day when power
generation falls below 46% of the dispatched level, giving credit
for the + 5% allowance. This is the result derived from
the formula, 100 – 5 = 95 – 45 = 50 x 2 = 100.

Sections 10.15(g) and 10.18 also relate to Forced Outage Days.
Section 10.15(g) provides in pertinent part as follows:

[Westmoreland] shall be allowed thirty (30) Forced Outage Days
per full Capacity Test Period (May 1 through April
30). . . . Payments for Dependable Capacity will
be reduced five hundred thousand ($500,000) dollars as liquidated
damages for each Forced Outage Day that occurred or was
designated by [Westmoreland] during that period in excess of the
above allowances.

And ? 10.18 provides in pertinent part as follows:

The parties agree that [Virginia] Power will be substantially
damaged in amounts that will be difficult or impossible to
determine if the Facility:

. . . .

(d) Exceeds the allowed number of Forced Outage Days in
Section 10.15(g).

Therefore, to the limited extent set forth in the Agreement,
the Parties have agreed on sums which the Parties agree are
reasonable as liquidated damages for such occurrences. It is
further understood and agreed that the payment of the liquidated
damages is in lieu of actual damages for such occurrences.

The relationship between ? 10.15(d) and the terms
"Forced Outage Days" and "Force Majeure Days"
is also relevant to this dispute. Under ? 14.1, a delay in
performance occurring on a given day is excused if Westmoreland
designates such day a "Force Majeure Day." A Force
Majeure Day may be designated when a delay in performance is
"due solely to circumstances beyond the reasonable control
of the Party experiencing such delay, [for example,] acts of God;
. . . war; riots; . . . or accidents."

A Force Majeure Day does not count against the thirty Forced
Outage Days allowed before the $500,000 per day liquidated damage
provision of ? 10.15(g) may be invoked. However, under
? 10.15(b) of the Contract, if a forced outage is
designated as an event of Force Majeure, "then [Virginia] Power’s obligation to pay the payments for Dependable Capacity
specified in Section 10.15(a) above shall cease, prorated daily,
until the condition of Force Majeure has been overcome."

In awarding summary judgment in Virginia Power’s favor, the
trial court found that the Contract was unambiguous and,
therefore, that evidence of trade custom and usage as well as
parol evidence concerning the parties’ intent and understanding
would be inadmissible. The court found further that Westmoreland
had "failed to maintain power generation at greater than 45%
of the specified level" on the days for which it sought
recovery. Hence, the court held, ? 10.15(d) of the Contract
expressly permitted Virginia Power to withhold Capacity Payments
for those days, including the days Westmoreland had designated as
Forced Outage Days, and to charge Westmoreland with all such days
"for the purpose of determining the liquidated damages
provision of the parties’ contract pursuant to
? l0.15(g)."

Admissibility of Evidence
Concerning Trade Custom and Usage

Westmoreland argues that it should have been permitted to
introduce evidence showing that "the terms ‘Capacity
Purchase Price’ and ‘Forced Outage Day’ have special meaning in
the trade custom and usage, under which the occurrence of such
Days does not diminish the monthly payment unless the annual
Forced Outage Day allowance is exceeded." Westmoreland
submits that "[t]his trade custom and usage, reflected in
all of the contracts resulting from the 1988 solicitation, ‘form
a part [of the Contract] … unless the terms of the writing
[clearly exclude] the usage or custom.’" (Quoting Walker
v. Gateway Milling Co.
, 121 Va. 217, 224, 92 S.E. 826, 828
(1917)). Westmoreland maintains there is no language in the
Contract that clearly excludes consideration of custom and usage.

Noting that the trial court excluded the evidence of trade
custom and usage because it found the Contract unambiguous,
Westmoreland cites Doswell Ltd. Partnership v. Virginia
Electric & Power Co.
, 251 Va. 215, 468 S.E.2d 84 (1996),
for the proposition that such evidence is admissible to show that
contract phrases or terms have acquired a peculiar meaning by
trade custom or usage "even though the phrases or terms
themselves are unambiguous." Id. at 225, 468 S.E.2d
at 90. Hence, Westmoreland concludes, the trial court erred in
excluding its evidence of trade custom or usage.

While we confirm what we said in Doswell, we disagree
with Westmoreland. In our opinion, Westmoreland has not met the
threshold requirement for admission of the disputed evidence.

In Walker, supra, we said that evidence of trade
usage is proper "to permit the jury to consider the
situation of the parties and the circumstances leading up to the
making of the contract for the purpose of determining whether the
usage in question operated upon the minds of the parties
in using the language which was employed in the contract."
121 Va. at 226, 92 S.E. at 829 (emphasis added). However,
"knowledge of the existence of the custom must be brought
home to the [contracting parties], unless the evidence shows that
it is so uniform and notorious at the place where the parties to
be affected by it reside, as to raise a prima facie
presumption that they knew of it." Bowles v. Rice,
107 Va. 51, 55, 57 S.E. 575, 577 (1907).

Because the Contract and the other agreements resulting from
the 1988 solicitation were made at or about the same time, what
was done under the other contracts could not possibly have been
brought home to, or have operated upon the minds of, the parties
to the Westmoreland contract at the time of its execution. In
other words, Westmoreland has failed to establish the existence,
at the time the Contract was executed, of any trade custom or
usage relevant to the meaning of the language that was employed
in the Contract. The trial court did not err, therefore, in
excluding evidence of trade custom and usage.

Admissibility of Parol Evidence

Westmoreland contends that ? 10.15(d) of the Contract is
ambiguous, even when viewed in isolation, because it does not
"define the financial consequence of treating a day as a
Forced Outage Day." And, Westmoreland says, when the
Contract, including ? 10.15(d), is read as a whole, it does
not "unambiguously permit any reduction of the capacity
purchase price on account of allowed Forced Outage Days."
Hence, Westmoreland concludes, "there was no justification
for the Circuit Court’s foreclosure of parol evidence of the
parties’ intent and understanding."

Virginia Power contends on the other hand that
? 10.15(d) is unambiguous. Virginia Power says that the
"2-for-1 reduced payment scale established by
? 10.15(d) applies to all shortfalls in
Westmoreland’s generating capacity after the initial five percent
variance." Therefore, Virginia Power asserts, "[w]hen
Westmoreland’s generation is 45% or less of the Dispatched level,
. . . Virginia Power has the right, in the words of
? 10.15(d), to reduce ‘that Day’s payment for Dependable
Capacity to zero (0).’" This shortfall occurred, Virginia
Power says, "on each day for which [it] made no Dependable
Capacity payment" and, hence, it was excused from making
payment for each of those days.

But, Virginia Power insists, even when ? 10.15(d) is
read along with the other provisions of the Contract, no
ambiguity appears. "Those other provisions," Virginia
Power says, "have nothing to do with the situation addressed
by ? 10.15(d) and do not make that section ambiguous."
Hence, Virginia Power concludes, the trial court did not err in
excluding parol evidence of the parties’ intent and
understanding.

"The question whether a writing is ambiguous is one of
law, not of fact." Tuomala v. Regent University, 252
Va. 368, 374, 477 S.E.2d 501, 505 (1996). Thus, "we are not
bound by the trial court’s conclusions on this issue, and we are
permitted the same opportunity as the trial court to consider the
contract provisions." Id.

In Doswell, supra, we reiterated the principle
that "’[p]arol evidence of prior or contemporaneous oral
negotiations are generally inadmissible to alter, contradict, or
explain the terms of a written instrument provided the document
is complete, unambiguous, and unconditional.’" 251 Va. at
222, 468 S.E.2d at 88 (quoting Renner Plumbing, Heating &
Air Conditioning, Inc. v. Renner
, 225 Va. 508, 515, 303
S.E.2d 894, 898 (1983)). We also said in Doswell:

Contracts are not rendered ambiguous merely because the
parties or their attorneys disagree upon the meaning of the
language employed to express the agreement. Even though an
agreement may have been drawn unartfully, the court must
construe the language as written if its parts can be read
together without conflict.

And, parol evidence may not be used to first create an
ambiguity and then to remove it. Finally, an agreement is not
rendered ambiguous merely because it deals with a technical
subject that may be considered complex to the uninformed lay
person who is not familiar with the topic. Id. at
222-23, 468 S.E.2d at 88-89 (citations omitted).

"A contract must be construed as a whole to determine the
parties’ intent with respect to specific provisions." Hooper
v. Musolino
, 234 Va. 558, 569, 364 S.E.2d 207, 212, cert.
denied, 488 U.S. 823 (1988). "No word or clause in
the contract will be treated as meaningless if a reasonable
meaning can be given to it, and there is a presumption that the
parties have not used words needlessly." D.C. McClain,
Inc. v. Arlington County
, 249 Va. 131, 135-36, 452 S.E.2d
659, 662 (1995).

"’An ambiguity exists when language admits of being
understood in more than one way,’" Doswell, 251 Va.
at 222, 468 S.E.2d at 88 (quoting Renner, 225 Va. at 515,
303 S.E.2d at 898), or when "’language is of doubtful
import,’" Galloway Corp. v. S.B. Ballard Constr. Co.,
250 Va. 493, 502, 464 S.E.2d 349, 355 (1995) (quoting Allen v.
Green
, 229 Va. 588, 592, 331 S.E.2d 472, 475 (1985)). And an
award of summary judgment is improper when "neither party
has offered a construction of [contractual] provisions that could
be deemed so clear that it unambiguously excludes the explanation
offered by the opponent." Cascades North Venture Ltd.
Partnership v. PRC Inc.
, 249 Va. 574, 582, 457 S.E.2d 370,
374-75 (1995).

Guided by these principles, we reach the conclusion that the
Contract is ambiguous. In the first place, the language of
? 10.15(d), even when read in isolation, admits of being
understood in more than one way, Doswell, 251 Va. at 222,
468 S.E.2d at 88, and, hence, is of doubtful import, Galloway,
250 Va. at 502, 464 S.E.2d at 355.

The penultimate sentence of ? 10.15(d) contains the
crucial language. The sentence states that "[if the
deviation from the dispatched level on a given day] reduces that
Day’s payment for Dependable Capacity to zero (0) then that Day
shall be a Forced Outage Day." If emphasis is placed upon
the words, "reduces that Day’s payment for Dependable
Capacity to zero," the language of (d) may be taken to mean
that the result of such a deviation would be no capacity payment
for that day. If, however, emphasis is placed upon the words,
"then that Day shall be a Forced Outage Day," the
language of (d) may just as well be taken to mean that the only
result of such a deviation would be the counting of the day in
question against the thirty Forced Outage Day allowance provided
by ? 10.15(g) before the $500,000 per day liquidated damage
provision may be invoked.

Hence, this case presents a situation in which "neither
party has offered a construction of these provisions that could
be deemed so clear that it unambiguously excludes the explanation
offered by the opponent." Cascades North Venture, 249
Va. at 582, 457 S.E.2d at 374-75. This alone is sufficient to
justify the admission of parol evidence concerning the parties’
intent and understanding at the time they entered into the
contract.

However, there is more. When ? 10.15(d) is read in
context with other provisions of the Contract, the ambiguity
becomes even more apparent. First, a reading of
? 10.15(b) demonstrates that when the parties wished to
make clear under what circumstances Virginia Power would not be
obligated to make Capacity Payments for a Forced Outage, they
knew how to accomplish the task, using clear and precise
language. Section 10.15(b) states that when Westmoreland
"designates [a] Forced Outage as an event of Force Majeure,
then [Virginia] Power’s obligation to pay the payments for
Dependable Capacity . . . shall cease."[5] As
Westmoreland suggests, the absence of such an explicit provision
in ? 10.15(d) casts doubt upon the correctness of Virginia
Power’s assertion that ? 10.15(d) unambiguously relieves it
from the obligation to make Capacity Payments for all Forced
Outage Days, however they occur.

Virginia Power argues that ? 10.15(b) is consistent with
? 10.15(d) in that both "relieve[] Virginia Power of
any obligation to pay Westmoreland for capacity Virginia Power
does not receive." However, this assumes the correctness of
Virginia Power’s position and begs the question to be decided, i.e.,
whether ? 10.15(d) really does relieve Virginia Power of
the obligation to make Capacity Payments for Forced Outage Days
occurring under ? 10.15(d).

Virginia Power also argues that ? 10.15(d) applies only
to those days on which Westmoreland’s facility is dispatched to
produce electrical power while ? 10.15(b) applies even if
Westmoreland is not so dispatched. But this argument misses the
point, viz., if it was necessary to say explicitly in
? 10.15(b) that Capacity Payments cease for Force Majeure
Days occurring under that section, was it not just as necessary
to say explicitly in ? 10.15(d) that payments cease for
Forced Outage Days occurring under that section? In any event, we
do not think it appears as a matter of law that the distinction
drawn by Virginia Power would make a difference in its obligation
with respect to Capacity Payments for Forced Outage Days, but
perhaps parol evidence submitted by the parties on remand will
reveal whether the distinction was intended to make a difference.

Second, ? 10.15(g) allows Westmoreland thirty
Forced Outage Days annually before the provision for liquidated
damages in the amount of $500,000 per day may be invoked. Section
10.18 provides that "the payment of the liquidated damages
is in lieu of actual damages" Virginia Power may suffer if
Westmoreland "[e]xceeds the allowed number of Forced Outage
Days in Section 10.15(g)." As Westmoreland maintains, these
provisions support the implication that liquidated damages may be
the only penalty Westmoreland must suffer for Forced Outage Days,
and such an implication is completely inconsistent with Virginia
Power’s position that ? 10.15(d) permits it to withhold
Capacity Payments for all Forced Outage Days in addition to
collecting $500,000 per day in liquidated damages if the number
of such days exceeds the thirty days allowed annually.

Virginia Power says, however, that ? 10.15(g)
"relates to a different subject matter than
? 10.15(d)," that "[n]either section refers to
the other," and that ? 10.15(g) "has nothing
whatsoever to do with Virginia Power’s obligation to make
Dependable Capacity payments." However, both sections
mention and deal with the subjects of Forced Outage Days and
payments for Dependable Capacity — ? 10.15(d) states that
a Forced Outage Day occurs when the deviation on a particular day
reduces that day’s Dependable Capacity payment to zero and
? 10.15(g) states that payments for Dependable Capacity
will be reduced by $500,000 for each Forced Outage Day that
exceeds the thirty-day allowance.

Moreover, ? 10.15(d) is implicitly incorporated by
reference into ? 10.15(g) because, in its final sentence,
the latter section states that "[p]ayments for Dependable
Capacity will be reduced five hundred thousand ($500,000) dollars
as liquidated damages for each Forced Outage Day that occurred
or was designated by [Westmoreland] during [a capacity
test] period in excess of the above allowances." (Emphasis
added.) If a Forced Outage Day is not designated by Westmoreland,
it can only occur as a result of the reductions required
by the sliding scale set forth in ? 10.15(d).

Therefore, it is not correct to say categorically, as Virginia
Power would have us say, that ? 10.15(g) has "nothing
whatsoever to do with Virginia Power’s obligation to make
Dependable Capacity payments." Rather, Westmoreland should
have the opportunity to show by parol evidence on remand what the
parties intended by the language they employed in the Contract.

We hold that it was error for the trial court to exclude parol
evidence concerning the parties’ intent and understanding with
respect to Forced Outage Days and Capacity Payments at the time
they executed the Contract.

Alternative Basis of Recovery

Westmoreland’s amended motion for judgment contained an
alternative claim of breach of contract for Virginia Power’s
withholding of Capacity Payments for days that Westmoreland
designated as Forced Outage Days pursuant to ? 1.20(a) of
the Contract. The trial court’s award of summary judgment in
favor of Virginia Power encompassed this alternative claim.

Under ? 1.20, a Forced Outage Day occurs when "(a)
designated by [Westmoreland] as a Forced Outage Day," or
"(b) determined pursuant to Section 10.15(d)."
Westmoreland argues that "[e]ven if ? 10.15(d) could
be read as depriving [it] of [capacity] payments attributable to
days that are classified as Forced Outage Days by [the section's] own operation, its impact [should] be limited to such days."
Hence, Westmoreland concludes, it was "entitled, at a
minimum, to a judgment for the amount attributable to the days
covered by ? 1.20(a)." Virginia Power says the trial
court did not err in denying Westmoreland a partial recovery for
designated days.

The trial court stated no reason for the inclusion of
Westmoreland’s alternative basis for relief in its award of
summary judgment. As Westmoreland suggests in a footnote to its
brief, the trial court’s disposition of this phase of the case
may have been inextricably entwined in the court’s conclusion
that ? 10.15(d) unambiguously "permits Virginia Power
not to make dependable capacity payments on days for which
[Westmoreland] seeks payment," which necessarily included
Forced Outage Days designated by Westmoreland pursuant to
? 1.20(a). Since we hold supra that the Contract is
ambiguous, we think the trial court on remand, if Westmoreland is
unsuccessful on its principal claim for breach of contract,
should have the opportunity to consider further the question
whether Virginia Power is entitled to withhold Capacity Payments
for Forced Outage Days designated by Westmoreland pursuant to
? 1.20(a).

Conclusion

We will affirm the trial court’s action in excluding evidence
of trade custom and usage. For the error in excluding evidence
concerning the parties’ intent and understanding with respect to
Forced Outage Days and Capacity Payments, we will reverse the
judgment of the trial court and remand the case for further
proceedings consistent with the views expressed in this opinion.

Affirmed in part,
reversed in part,
and remanded.

 

[1] The Contract was "amended
and restated" in 1990 and 1991, but the provisions in issue
here have remained unchanged since the 1989 version of the
Contract was executed by the parties.

[2] Virginia Power operates in
North Carolina under the name North Carolina Power. However, for
convenience and clarity, we will continue throughout this opinion
to refer to Virginia Power only.

[3] The Contract allows 30 days
annually for scheduled outages. Westmoreland says it is
undisputed that Capacity Payments are "never reduced on
account of Scheduled Outages."

[4] The parties tell us on brief
that the Model Agreement accompanying Virginia Power’s request
for proposals contained a provision that a Forced Outage Day
would occur when the net electrical output deviated from the
dispatched level by more than + 5%. However, because
Westmoreland planned to use a low grade fuel to generate
electricity, with likely reductions in power output below 95% of
the dispatched level, the parties agreed to the inclusion of ?
10.15(d) in the Contract, which increased from 5% to 55% the
permitted deviation from the dispatched level before a Forced
Outage Day occurred.

[5] Similarly, ? 5.3 of the
Contract provides that Virginia Power "shall not be
obligated to make payments for Dependable Capacity" during
periods allowed to cure defaults under the Contract.

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