remove duplicate ip addresses with smaller prefix

src/bosh-director/lib/bosh/director/deployment_plan/ip_provider/ip_repo.rb

@@ -96,6 +96,13 @@ def try_to_allocate_dynamic_ip(reservation, subnet)
         addresses_we_cant_allocate.delete_if { |ipaddr| ipaddr.ipv6? }
       end
 
+      addresses_we_cant_allocate.reject! do |ip|
+        addresses_we_cant_allocate.any? do |other_ip|
+          includes = other_ip.include?(ip)
+          includes && other_ip.prefix < ip.prefix
+        end
+      end
+
       ip_address_cidr = find_next_available_ip(addresses_we_cant_allocate, first_range_address, subnet.prefix)
 
       if !(subnet.range == ip_address_cidr || subnet.range.include?(ip_address_cidr))

src/bosh-director/lib/bosh/director/deployment_plan/manual_network_subnet.rb

@@ -71,7 +71,7 @@ def self.parse(network_name, subnet_spec, availability_zones, managed = false)
 
           restricted_ips.reject! do |ip|
             restricted_ips.any? do |other_ip|
-              includes = other_ip.include?(ip) rescue false
+              includes = other_ip.include?(ip)
               includes && other_ip.prefix < ip.prefix
             end
           end

src/bosh-director/spec/unit/bosh/director/deployment_plan/ip_provider/ip_repo_spec.rb

@@ -279,6 +279,27 @@ def dynamic_reservation_with_ip(ip)
           end
         end
 
+        context 'when existing ips overlap with restricted ips' do
+          def save_ip(ip)
+            Bosh::Director::Models::IpAddress.new(
+              address_str: ip.to_s,
+              network_name: 'my-manual-network',
+              instance: instance_model,
+              task_id: Bosh::Director::Config.current_job.task_id
+            ).save
+          end
+
+          it 'clears similar ips with smaller prefix' do
+            network_spec['subnets'].first['reserved'] = ['192.168.1.0 - 192.168.1.12']
+            network_spec['subnets'].first['range'] = '192.168.1.0/24'
+            save_ip(cidr_ip('192.168.1.8'))
+
+            ip_address = ip_repo.allocate_dynamic_ip(reservation, subnet)
+            expected_ip_address = cidr_ip('192.168.1.13')
+            expect(ip_address).to eq(expected_ip_address)
+          end
+        end
+
         context 'when there are static and restricted ips' do
           it 'does not reserve them' do
             network_spec['subnets'].first['reserved'] = ['192.168.1.2']