directors’ report  REVIEW OF OPERATIONS (b) Mezzanine Debt (a) Construction Payments Schedule (c) Managed Investments Act Burnley Tunnel Failure 2 Extensive investigations of the entire tanked section of tunnel were undertaken subsequent to the failure. As a consequence of these investigations, the TOJV has recommended the installation of a physical restraint at the arch floor joint throughout the tanked section of the tunnel. The purpose of this restraint is to provide a high degree of certainty that no further movements of the joint will occur. The TOJV has met the cost of this work. This failure is a defect in the works undertaken by TOJV and under the contract between Transurban and the TOJV, the TOJV is liable for the cost of rectifying the defect and any resultant damages suffered by Transurban. In this latter category, Transurban lost approximately $1.9 million in toll revenue and incurred $0.6 million in consulting costs. These amounts will be claimed from TOJV. On 19 February 2001, a structural failure in an arch section of the Burnley Tunnel resulted in a full closure of the Burnley Tunnel for nine days. Subsequently, one lane was closed over half the length of the tunnel to allow repair of the failed section. Full three-lane operation was restored on 17 June 2001. This change was a result of the provisions of Managed Investment Act 1998 (the Act) which came into effect on 14 August 1998. The Act created a new regulatory environment and changed the workings of the Trust generally. In particular, the Act provides for the governance of the Trust by a single responsible entity. Formerly, the governance of a Trust was effected through a dual entity structure involving a trustee and a manager. On 30 March 2001, the Trustee became the Responsible Entity of the Trust and the Trust Manager was appointed under an investment management agreement to continue to undertake many of its existing functions.  Completion of the Southern Link was certified on 21 December 2000, 331 days after the contractual Date for Completion of 26 January 2000. As part of the certification of Completion, certain works related to groundwater monitoring and CTCS software were nominated for subsequent certification (Certifiable Works) and a total amount of $4 million was deposited with the State to secure the completion of these works. At 30 June 2001, two items of Certifiable Works remained outstanding and $2.7 million remained on deposit in respect of these items. These items were completed on 24 August 2001. At 30 June 2001 aggregate payments to the TOJV under the D&C Contract remained unchanged for the year at $112 million. The aggregate of paid and deferred claims  is equivalent to 98.8 per cent of the contract value. A partial payment of Mezzanine Interest was made by the Trust on 15 December 2000. The Trust made no payment on 15 March 2001, a partial payment on 15 June 2001 with all outstanding interest then being paid on 31 July 2001 to Mezzanine Noteholders. The nonpayment of interest was a technical Event of Default under the Mezzanine Note Facility. The only effect of the Event of Default was that interest accrued at the Default Interest Rate, which is 200 basis points above the facility rate. The additional net interest cost over the period was $2 million. on the Transurban City Link Unit Trust