7 Legal proceedings (1) As a condition precedent to their right to be indemnified under this Schedule, the Bank shall, as soon as possible and in any event within 30 days after discovery by the Bank of any loss thereunder, given written notice thereof to the Government.
(2) The Bank shall within 6 months after any such discovery, furnish to the Government affirmative proof of loss together with full particulars.
(3) Legal proceedings for the recovery of any loss hereunder shall not be brought after the expiration of 2 years from the discovery of the loss, except that any action or proceeding to recover hereunder on account of any judgement against the Bank in any suit shall be commenced within 2 years from the date upon which the judgement in such shall become final.
8 Legal fees (1) The Government shall indemnify the Bank for all such reasonable legal fees, costs and expenses incurred and paid by the Bank in the defence of any demand, claim, suit, or legal proceeding with respect to which the Bank established that the act or acts which were committed would entitle the Bank to recover under this Schedule if any loss resulted therefrom. Such indemnity shall be in addition to the Limits specified in Section 6:
Provided that such indemnity shall only apply if the Attorney-General has received written notice in advance that action is being taken by the Bank that might result in liability under this Section and has not given notice to the Bank that the Government will not indemnify under the provisions of this proviso.
(2) The Government shall be entitled at any time to take over and conduct in the name of the Bank the defence of any such demand, claim, suit or legal proceeding made against the Bank, it being understood, however, that the Bank shall not be required to contest any legal proceedings unless the Attorney General shall give notice in writing that such proceedings should be contested.
(3) If such loss, claim or damage does not exceed the excess the Government are not liable for such legal fees, costs, and expenses. However, if such loss, claim or damage should exceed the excess then subject to the proviso to paragraph (1) of this section the Government are liable for the preparation of such legal fees, costs and expenses that the amount of such loss, claim or damage recoverable under this Schedule bears to the sum of such amount and the excess.
(4) The Government shall not indemnify the Bank for fees, costs or other expenses (whether such fees, costs and expenses be for legal, accounting or other services) incurred by the Bank in establishing the existence of or amount of loss covered by this Schedule.