Lesson 155. Causation and remoteness | AQA A-Level Law
For Specification 7162
AQA A-Level Law | Free Revision Notes
Estimated study time: 40 minutes
Establishing a breach and identifying a financial loss do not automatically mean that the whole loss will be recovered as damages. These Causation and remoteness A-Level Law revision notes explain two important controls on compensation: the loss must be connected to the defendant's breach, and it must not be too remote. AQA expressly includes causation and remoteness within compensatory damages. This lesson develops recoverable loss [Lesson 154. Compensatory damages and recoverable loss] and prepares you for the further restriction created by mitigation [Lesson 156. Mitigation].
Learning Objectives 🎯
By the end of this revision page, you should be able to:
Explain causation in relation to contractual damages.
Determine whether a contractual breach caused the loss claimed.
Explain remoteness as a restriction on contractual damages.
Explain the significance of what the defendant knew or ought reasonably to have known when the contract was made.
Apply causation and remoteness separately to factual scenarios.
Reach reasoned conclusions about whether particular contractual losses are recoverable.
Revision Notes 📚
Why causation and remoteness matter
The purpose of compensatory damages is to compensate for loss resulting from breach of contract.
However, contract law does not simply make the defendant responsible for every disadvantage that happens after the breach.
AQA requires students to understand four connected aspects of contractual damages:
categories of recoverable loss
causation
remoteness
mitigation
These appear expressly in the specification as part of the remedies for breach of contract.
A useful structure is:
breach → loss → causation → remoteness → mitigation
Each stage asks a different question.
Stage | Question |
Loss | What financial loss has the claimant suffered? |
Causation | Did the breach cause that loss? |
Remoteness | Is that type of loss sufficiently connected with what the defendant knew or ought reasonably to have known when the contract was made? |
Mitigation | Did the claimant take reasonable steps to reduce the loss? |
This means that identifying an expectation loss, reliance loss or other financial consequence in [Lesson 154. Compensatory damages and recoverable loss] is only the beginning.
Causation in contractual damages
Causation asks whether the defendant's contractual breach actually caused the loss for which the claimant seeks compensation.
The claimant must connect:
the contractual obligation
the defendant's breach
the particular financial loss
It is not enough merely to show that:
a contract existed
the defendant breached it
the claimant happened to lose money
The loss must arise from the breach being relied upon.
Example
Aisha contracts with Ben to repair an essential machine by Monday.
Ben fails to repair it.
Aisha has to pay another contractor an additional £500 to complete the repair.
There is a clear factual connection:
Ben's failure to repair → need for replacement contractor → additional £500
The £500 is therefore capable of being treated as loss caused by the breach.
Whether it is ultimately recoverable also requires consideration of remoteness and mitigation [Lesson 156. Mitigation].
A loss that would have occurred anyway
Causation becomes more difficult where the claimant would have suffered the same loss even if the defendant had performed the contract correctly.
Example
Cara contracts with Dev to supply equipment on Friday.
Dev fails to supply it.
Cara claims £2,000 because an unrelated power failure forced her business to close on Friday.
If the power failure would have prevented Cara using the equipment even if Dev had supplied it, there is a serious causation problem.
The loss caused by the closure cannot simply be attributed to Dev's contractual breach.
📌 Exam technique: Do not assume that because an expense or loss occurred after the breach, it was caused by the breach.
Identify the particular breach
Where several contractual obligations exist, connect the claimed loss to the specific term breached.
For example:
Elena's car is returned late after a service and she pays for alternative transport.
If she claims the transport cost, identify whether that expense was caused by:
the delay in returning the car
defective work on the car
another unrelated event
This matters particularly in complex AQA questions where a trader may have broken more than one statutory or common law term.
Building a causation chain
A useful examination technique is to construct a short chain:
contractual obligation → breach → consequence → financial loss
Example
Farah contracts with George to provide a suitcase suitable for use in an aircraft cabin.
The suitcase supplied is too large.
Farah is charged £25 to put it in the aircraft's hold.
The chain is:
obligation to supply suitable suitcase → unsuitable suitcase supplied → suitcase cannot travel in cabin → £25 hold charge
This demonstrates a clear connection between breach and loss.
AQA's 2025 assessment treated the £25 additional luggage charge as a possible damages claim, subject particularly to foreseeability and remoteness.
Causation comes before remoteness
Causation and remoteness are related but distinct.
Suppose:
Haris breaches a contract and Isla loses £5,000.
Two separate questions arise.
Causation:
Did Haris's breach actually cause Isla to lose the £5,000?
If the answer is no, the claim fails in relation to that loss.
If the answer is yes, move to:
Remoteness:
Is that type of £5,000 loss sufficiently connected with what Haris knew or ought reasonably to have known when the contract was made?
Do not merge the two questions into a vague statement that the loss was "foreseeable".
What is remoteness?
Remoteness limits which losses caused by a breach may be recovered.
A loss can genuinely result from the breach but still be considered too remote for the defendant to be required to compensate it.
The central authority repeatedly identified in AQA assessment materials is:
Hadley v Baxendale
AQA examiner reports use Hadley v Baxendale when asking what the defendant knew, or ought reasonably to have known, at the time the contract was made about the losses that could result from breach.
This creates an important distinction:
causation asks what happened
while:
remoteness asks whether that resulting loss falls within the defendant's contractual responsibility
Hadley v Baxendale
For AQA purposes, Hadley v Baxendale is the key authority for contractual remoteness.
The practical question is:
At the time the parties made the contract, what did the defendant know or ought the defendant reasonably to have known about the kind of loss that might follow from breach?
AQA's 2025 examiner report applied this directly to a lorry-hire contract. Students were expected to consider what Gabriel Ltd knew or ought reasonably to have known when the contract was made about the financial losses Foxton Ltd might incur if the lorry was not supplied.
Notice the timing.
The relevant point is:
when the contract was made
not:
when the breach later occurred
Why knowledge at formation matters
Contracting parties enter an agreement with a particular understanding of what is at stake.
If one party knows that failure to perform could expose the other to a particular financial consequence, that knowledge may support the argument that the resulting loss is not too remote.
By contrast, a highly unusual loss may be difficult to recover if the defendant had no reason to know that such a consequence could follow.
Example
Jack hires a van from Keira.
Keira knows that Jack needs the van to make an ordinary business delivery on a fixed date.
If Keira breaches and Jack loses ordinary financial benefits associated with the failed delivery, her knowledge of the purpose of the hire may be important to remoteness.
Compare this with a hidden consequence:
Jack intended to use the van to complete an unusually valuable transaction but never told Keira anything about it.
The unusual additional loss raises a much stronger remoteness issue.
What the defendant actually knew
A defendant's actual knowledge can make an otherwise unusual loss more clearly connected to the contract.
Example
Lara tells Malik:
"I need this machine by Friday because if it is not operating, I will lose a specific commercial order."
Malik agrees to supply the machine knowing this information.
If Malik later breaches and the identified order is lost, his actual knowledge of the commercial purpose is highly relevant when considering remoteness.
A strong answer should identify what information was communicated rather than merely asserting that the defendant "should have known".
What the defendant ought reasonably to have known
The AQA approach also considers what the defendant ought reasonably to have known.
The defendant does not necessarily need to have been expressly told every ordinary consequence of breach.
For example, where a travel business sells a suitcase specifically for cabin use, the seller may reasonably be expected to understand that an oversized suitcase could create additional luggage costs.
AQA's 2025 mark scheme considered Deeta's £25 airport charge likely to satisfy the relevant foreseeability and remoteness requirements. Emma operated a travel agency and knew why Deeta wanted a suitcase of that particular size.
This demonstrates application based upon:
the nature of the contract
the defendant's business
the claimant's known purpose
the particular loss suffered
The Deeta suitcase example
AQA's 2025 examination provides one of the clearest recent remoteness examples.
Deeta:
asked Emma Travel about suitcases permitted in the passenger section of aeroplanes
bought a suitcase from a display described as suitable for that purpose
later discovered that it was too large
had to pay an additional £25 for it to be stored in the hold
The AQA mark scheme treated damages for the £25 as potentially recoverable and highlighted two important facts:
extra luggage charges are connected with the ordinary purpose for which a suitcase of that size is bought
Emma ran a travel agency and knew why Deeta wanted the suitcase
The remoteness argument was therefore strong.
This is exactly the type of factual detail students should use rather than merely writing:
"The loss was foreseeable."
The Kaleb taxi example
AQA's 2025 examiner report also provides a more uncertain example.
Kaleb's car remained with Henry for an extended period during a service. Kaleb paid for a taxi to attend a medical appointment.
AQA stated that Kaleb might be able to claim the taxi expense, but also recognised an argument that the loss was too remote.
The important examination question is:
What did Henry know or ought reasonably to have known when the contract was made about Kaleb's need for the car and the potential cost of alternative transport?
If Henry knew only that he was servicing a car, some alternative travel expense might be foreseeable.
However, the particular circumstances of a medical appointment may raise a more difficult question if nothing about that need was communicated.
A reasoned answer should therefore analyse both sides rather than automatically award the taxi fare.
The Foxton Ltd lorry example
AQA's 2025 Paper 3A involved Gabriel Ltd contracting to supply Foxton Ltd with a lorry.
Foxton Ltd required the lorry to:
deliver machinery to its own client
meet an agreed deadline
Failure to obtain the lorry might therefore affect:
Foxton Ltd's profit
financial losses resulting from failure to meet the deadline
AQA's examiner report explained that remoteness required consideration of what Gabriel Ltd knew or ought reasonably to have known at the time of contracting about these potential consequences.
The report suggested that Gabriel Ltd at least ought reasonably to have understood that Foxton Ltd was making a scheduled machinery delivery, so issues of profit and loss could arise.
This is a useful model for business-to-business scenarios.
Ordinary and unusual losses
Although AQA expects remoteness only at the level required by the specification, scenarios often distinguish between:
losses that are an understandable consequence of the contractual purpose
unusual losses dependent upon special circumstances
The practical approach remains the same:
What did the defendant know or ought reasonably to have known when entering the contract?
Example
Maya hires a replacement vehicle from Noah because Noah fails to provide one he promised.
The additional reasonable hire cost is closely connected with the failure to supply a vehicle.
Now suppose Maya also claims the loss of an exceptionally valuable business prize which depended upon using that vehicle.
That second loss needs much closer examination of Noah's knowledge when the contract was formed.
Was Noah told about the prize?
Did the nature of the contract make that risk apparent?
If not, the loss may be too remote.
Victoria Laundry and H Parsons
AQA assessment materials also identify the following authorities when analysing contractual remoteness:
Victoria Laundry Ltd v Newman Industries Ltd
H Parsons (Livestock) Ltd v Uttley Ingham & Co Ltd
They appear alongside Hadley v Baxendale in AQA mark schemes as relevant authority for remoteness of contractual damage.
For this revision page, the essential examinable principle remains the application of remoteness to the facts, particularly the significance of the defendant's knowledge at the time the contract was made.
Do not substitute a list of case names for factual application.
A loss can be caused but still too remote
This distinction is worth mastering.
Example
Olivia contracts with Pavel to deliver a computer on Monday.
Pavel fails to deliver it.
Olivia therefore cannot complete a highly unusual transaction and loses £50,000.
Assume the failure to supply the computer clearly caused the lost transaction.
Causation: satisfied.
But suppose Pavel knew nothing about the £50,000 transaction and had no reason to know that a failure to deliver an ordinary computer could cause such a loss.
Remoteness: still highly arguable.
The fact that causation is satisfied does not automatically satisfy remoteness.
A loss can be foreseeable but not caused by the breach
The reverse can also happen.
Example
Quinn contracts to supply Rachel with business equipment.
It is entirely foreseeable that failure to supply business equipment could cause lost profit.
However, Rachel's business would have been closed during the relevant period because of an unrelated event.
The category of loss may appear foreseeable, but if Quinn's breach did not actually cause Rachel to lose the profit, the claim still fails on causation.
This is why the two requirements must be applied separately.
Remoteness and loss of profit
Loss of profit was considered in Compensatory damages and recoverable loss [Lesson 154. Compensatory damages and recoverable loss].
Even where an expected profit can be calculated, the remoteness rules still apply.
Example
Sam agrees to deliver specialist equipment to Tia's business.
The equipment is needed to complete a profitable customer order.
If Sam knows the commercial purpose of the equipment, a resulting profit loss may be more readily connected with the risks of breach.
If Sam had no knowledge that the equipment was connected with a separate high-value transaction, recovery of an unusual loss becomes more difficult.
AQA's Foxton Ltd scenario demonstrates this link between expected commercial profit and the defendant's knowledge.
Remoteness and loss of a chance
AQA assessment materials also connect remoteness with loss of a chance.
In the 2024 examination, defective servicing of a racing bicycle potentially prevented Vince from competing for prize winnings.
The mark scheme expressly required analysis of damages, remoteness and compensation for loss of a chance.
Therefore, identifying Chaplin v Hicks and a loss of chance does not complete the damages analysis.
You should still ask whether the defendant knew or ought reasonably to have known of the circumstances making the opportunity relevant to the contract.
Remoteness and consumer contracts
Consumer Rights Act remedies do not necessarily remove the need to consider common law damages.
AQA's recent examiner reports repeatedly emphasise that a consumer may potentially have:
statutory remedies, and
a damages claim for associated financial losses
However, associated losses remain subject to restrictions such as remoteness.
Deeta
Possible £25 airport luggage charge, likely strong remoteness argument.
Kaleb
Possible taxi expense, but remoteness was arguable.
These examples show why a student should not stop after correctly identifying a statutory right to reject, repair, replacement, repeat performance or price reduction.
Remoteness is assessed using the contractual context
When applying remoteness, look at the contract itself.
Relevant factual questions include:
What was being supplied?
Why did the claimant want it?
Was that purpose communicated?
What kind of business did the defendant operate?
Was the contract obviously commercial?
Was there a deadline?
Did the defendant know another transaction depended upon performance?
Was the particular type of financial consequence apparent?
AQA's examiner materials reward this kind of fact-specific reasoning.
Causation and remoteness are controls on compensation
The law's aim is compensation, but the claimant is not entitled to transfer every later financial difficulty to the party in breach.
The rules provide a sequence of controls.
First: identify the loss
For example:
£1,000 lost profit.
Second: causation
Was that £1,000 loss actually caused by the defendant's breach?
Third: remoteness
Did the type of £1,000 loss fall within what the defendant knew or ought reasonably to have known when making the contract?
Fourth: mitigation
Did the claimant take reasonable steps to reduce the loss?
The next stage is covered in Mitigation [Lesson 156. Mitigation].
A causation and remoteness exam structure
When damages arise in a scenario, use the following approach.
Step 1: identify the breach
State briefly what contractual obligation has been broken.
For example:
Zara breached the term requiring delivery on Friday.
Do not repeat all the rules of formation if the contract is already established.
Step 2: identify each claimed loss separately
For example:
£300 replacement hire
£2,000 lost profit
£150 travel expense
Different losses may produce different conclusions.
Do not deal with them as one undifferentiated "damages" claim.
Step 3: establish causation
For each item, ask:
Did the breach lead to this loss?
Use the facts to show the connection.
For example:
Because Zara failed to provide the vehicle, Aaron had to hire another for £300.
Step 4: apply remoteness
Ask:
What did Zara know or ought reasonably to have known when the contract was made?
Explain why the relevant type of loss was or was not within the contractual risk.
Use Hadley v Baxendale.
Step 5: distinguish ordinary from unusual circumstances
Where the loss depends upon an unusual situation, ask whether the defendant had been informed about it.
Do not automatically assume that every commercial loss is recoverable simply because the claimant happens to be a business.
Step 6: reach a conclusion for each loss
For example:
The £300 replacement hire appears both caused by the breach and unlikely to be too remote because Zara knew she was contracting to supply a vehicle for Aaron's business use.
Then separately:
The £10,000 lost competition prize is more uncertain because there is no evidence that Zara knew of that unusual opportunity when the contract was made.
Step 7: move on to mitigation
Even a loss satisfying causation and remoteness may be reduced if the claimant failed to act reasonably after breach.
That is the focus of Mitigation [Lesson 156. Mitigation].
Worked example 1: straightforward causation
Aaron contracts with Bella to repair essential equipment for £2,000. Bella commits a repudiatory breach and does no work. Aaron reasonably pays another contractor £2,400 to complete the same work.
Loss:
$$£2,400 - £2,000 = £400$$
Causation: Bella's failure means Aaron must obtain replacement performance at an additional cost.
There is therefore a direct connection between breach and the £400 loss.
Remoteness: An additional reasonable cost of obtaining equivalent performance is closely connected with failure to provide the contracted service.
On the stated facts, there is a strong argument that the £400 is recoverable, subject to mitigation.
Worked example 2: loss would have happened anyway
Chloe contracts with Dev to deliver machinery to her factory on Monday. Dev does not deliver it. However, the factory is independently closed for the whole week because of a power failure. Chloe claims five days of lost production from Dev.
There is a breach.
However, even if Dev had supplied the machinery, the power failure would still have prevented production.
The claimed production loss therefore has a serious causation problem.
There is no need to rely solely on remoteness because the loss cannot first be clearly attributed to Dev's breach.
Worked example 3: Deeta's £25
Emma Travel supplies Deeta with a suitcase after being told that Deeta requires one small enough to travel in the passenger section of an aeroplane. The suitcase is too large. At the airport, Deeta must pay £25 to put it in the hold.
Causation: The unsuitable size causes the additional charge.
Remoteness:
Emma Travel:
knows Deeta's purpose
operates a travel business
can reasonably be expected to understand the financial consequences associated with oversized cabin luggage
Following AQA's 2025 analysis, the £25 is therefore likely to satisfy remoteness.
Worked example 4: special commercial loss
Farah hires a van from George. She tells George only that it is needed for a normal business delivery. George breaches and fails to supply it. Farah claims £50,000 because the delivery happened to be connected with an unusually valuable contract which she had never mentioned.
Causation: Assuming the failure to supply the van caused Farah to miss the transaction, causation may be established.
Remoteness: The very large and unusual financial consequence raises a separate issue.
The question is what George knew or ought reasonably to have known when the contract was made.
Because the exceptional value was never communicated, recovery of the £50,000 is much more doubtful.
Worked example 5: known commercial purpose
Haris contracts with Isla Ltd for a lorry to deliver machinery to a customer by a strict deadline. Haris explains the purpose and deadline when contracting. Isla Ltd fails to provide the lorry and Haris loses profit on the customer transaction.
Causation: Failure to supply the lorry prevents the delivery and causes the commercial loss.
Remoteness:
Isla Ltd knew that:
the vehicle was required for a machinery delivery
the delivery had a deadline
the contract formed part of Haris's commercial activity
There is therefore a much stronger argument that resulting commercial profit or loss was within the risks known at formation.
This reflects the reasoning highlighted in AQA's 2025 Foxton Ltd examiner report.
Worked example 6: taxi fare
Jacob leaves his car with Kira's garage for work that should be completed within a reasonable time. The garage keeps the car far longer than expected. Jacob pays £80 for a taxi to a medical appointment.
The taxi expense may have been caused by the delayed return of the car.
However, AQA's 2025 examiner report treats remoteness as genuinely arguable in this type of situation.
Ask:
Did Kira know Jacob would require alternative transport?
Was that a normal consequence of retaining a customer's car?
Did Kira know anything about the particular medical appointment?
Is the £80 expense within the type of loss reasonably connected with the contract?
A strong answer would not automatically award or reject the £80.
It would apply Hadley v Baxendale to the facts.
Worked example 7: loss of a chance
Luca tells Maya, a bicycle mechanic, that he needs his racing bicycle ready for a competition with substantial prize money. Maya breaches the contract and Luca misses the competition.
The lost opportunity may be considered a loss of a chance under the principles covered in [Lesson 154. Compensatory damages and recoverable loss].
However, remoteness must still be addressed.
Because Maya was told about the competition and the potential prize when the contract was made, the connection between breach and competitive financial loss is considerably stronger than if Luca had kept the purpose secret.
Worked example 8: two losses, two conclusions
Nia contracts with Omar to provide specialist equipment for a conference. Omar knows that the equipment is required for that conference. He does not know that Nia has separately promised an investor that she will pay £20,000 if the presentation does not begin at exactly 9 am. Omar breaches and the presentation starts late. Nia pays £300 to hire emergency equipment and also pays the investor £20,000.
£300 emergency hire
Causation: Omar's breach necessitated the hire.
Remoteness: Replacement expenditure is closely related to failure to supply the equipment and to Omar's knowledge of the conference.
There is a strong argument for recovery.
£20,000 payment
Causation: The late start may have triggered Nia's separate promise.
Remoteness: Omar knew nothing about the highly unusual £20,000 arrangement.
This loss is much more likely to be challenged as too remote.
The same breach can therefore produce several losses with different legal outcomes.
Key Words 🔑
Key word | Student-friendly definition | How it may be used in an exam |
Causation | The requirement that the contractual breach must have caused the loss for which damages are claimed. | Link a specific breach to each particular financial consequence. |
Remoteness | A rule limiting damages where the loss falls outside the contractual risks for which the defendant should be responsible. | Decide whether a caused loss is nevertheless too remote to recover. |
Hadley v Baxendale | The principal authority identified by AQA for remoteness of contractual damage. | Analyse what the defendant knew or ought reasonably to have known when the contract was made. |
Foreseeability | Consideration of whether the relevant type of loss was within what the defendant knew or ought reasonably to have known could result from breach. | Apply the defendant's knowledge and the contractual purpose to remoteness. |
Damages | Financial compensation for recoverable loss caused by breach of contract. | Apply causation, remoteness and mitigation after identifying the claimant's loss. |
Hints from the Examiner Reports 💡
Examiner hint: Do not stop after identifying a financial loss. In 2025, AQA found that many students simply asserted that Deeta could recover her £25 luggage charge without considering whether the loss was too remote under Hadley v Baxendale.
Examiner hint: Use the information known when the contract was made. Stronger answers to the 2025 Foxton Ltd question examined what Gabriel Ltd knew or ought reasonably to have known about the financial consequences if it failed to supply the lorry.
Examiner hint: Apply facts, not labels. Saying that a loss was "foreseeable" is much weaker than explaining what the defendant knew about the claimant's purpose, deadline or commercial arrangements.
Examiner hint: Analyse each loss separately. A replacement cost may be clearly recoverable while an unusual lost profit or additional expense arising from the same breach may be too remote.
Examiner hint: Remember that remoteness can defeat a claim completely. AQA's 2025 report explained that the remoteness issue concerning Kaleb's taxi fare might have prevented recovery altogether, while mitigation might instead have limited the amount recovered.
Examiner hint: Do not forget common law damages when a Consumer Rights Act question also raises an associated financial loss. Recent examiner reports found that students were often stronger on statutory remedies but much weaker on remoteness.
Examiner hint: The AQA specification requires remoteness at a relatively focused level. The 2023 report expressly described students as needing a basic understanding of remoteness of contractual damage.
Common Mistakes ⚠️
Mistake: Assuming every loss occurring after breach was caused by it
Why this is incorrect: Timing alone does not establish causation. The claimant must connect the breach to the particular loss.
How to improve: Write a factual chain:
breach → consequence → loss
If the loss would have occurred anyway, explain why causation may fail.
Mistake: Treating causation and remoteness as the same test
Why this is incorrect: A loss may genuinely have been caused by the breach but still be too remote.
How to improve:
Use separate paragraphs:
causation
remoteness
Mistake: Saying "the loss was foreseeable" without applying any facts
Why this is incorrect: The remoteness analysis depends on what the defendant knew or ought reasonably to have known when the contract was made.
How to improve:
Identify:
the contractual purpose
information given to the defendant
the defendant's business or expertise
relevant deadlines or commercial circumstances
Mistake: Looking at the defendant's knowledge only when the breach happened
Why this is incorrect: AQA's examiner guidance focuses on what the defendant knew or ought reasonably to have known when the contract was made.
How to improve: Build a timeline and focus the remoteness analysis on the point of formation.
Mistake: Automatically awarding unusual lost profits
Why this is incorrect: An unusual financial consequence may depend upon circumstances the defendant did not know about.
How to improve: Ask whether the defendant knew or ought reasonably to have known of the commercial purpose that produced the particular loss.
Mistake: Assuming consumer statutory remedies replace remoteness
Why this is incorrect: A claimant may have statutory remedies and an associated common law damages claim, but that damages claim remains subject to remoteness.
How to improve: Deal with statutory remedies first where required, then separately test associated financial loss under the common law rules.
Mistake: Forgetting mitigation after proving remoteness
Why this is incorrect: A loss can satisfy causation and remoteness but still be reduced if the claimant failed to take reasonable steps to minimise it.
How to improve: After completing causation and remoteness, move to Mitigation [Lesson 156. Mitigation].
Exam-Style Questions ✍️
Question 1
What is meant by causation in a claim for contractual damages?
[1 mark]
Question 2
Explain the difference between causation and remoteness in contractual damages.
[4 marks]
Question 3
Identify the principal case used by AQA when considering remoteness of contractual loss.
[1 mark]
Question 4
Amina contracts with Bilal to repair her machinery. Bilal breaches the contract. Amina reasonably pays another contractor an additional £600 to complete the repair.
Explain whether the £600 is connected to Bilal's breach.
[5 marks]
Question 5
Cara contracts with Dylan to supply machinery to her factory. Dylan fails to deliver it. The factory would in any event have been closed for the whole week because of an unrelated power failure. Cara claims lost profits for that week.
Apply causation to Cara's claim.
[5 marks]
Question 6
Emma Travel sells Deeta a suitcase after being told that Deeta needs one suitable for the passenger section of an aeroplane. The suitcase is too large and Deeta must pay £25 to place it in the hold.
Apply causation and remoteness to the £25 loss.
[5 marks]
Question 7
George agrees to supply Haris with a delivery vehicle. Haris tells George only that the vehicle is required for business deliveries. George breaches the contract. Haris loses £30,000 under a highly unusual separate transaction which George knew nothing about.
Advise Haris whether the £30,000 is likely to be recoverable.
[10 marks]
Question 8
Imani Ltd hires a specialist lorry from Jacob Ltd. When making the contract, Imani Ltd explains that it needs the lorry to deliver machinery to a customer by an agreed deadline. Jacob Ltd fails to provide it. Imani Ltd loses £4,000 profit on the customer contract and also pays £500 to hire an emergency replacement vehicle.
Apply causation and remoteness to both losses.
[10 marks]
Question 9
Kara leaves her car with Leo's garage for a service. Leo agrees that the work will be completed within a reasonable time but retains the car for three weeks. Kara pays £100 for a taxi to an important private appointment and £250 to hire another vehicle for work during the delay.
Advise Kara on causation and remoteness in relation to both expenses.
[10 marks]
Answers and Mark Scheme
Question 1
1 mark for recognising that the claimant must establish that the defendant's breach caused the loss for which damages are claimed.
Question 2
Award up to 4 marks for explaining that:
causation asks whether the breach actually caused the particular loss
a loss which would have happened anyway may fail the causation requirement
remoteness is a separate legal restriction on losses which have been caused
remoteness considers what the defendant knew or ought reasonably to have known when the contract was made
Question 3
1 mark for:
Hadley v Baxendale
Question 4
Award up to 5 marks for:
identifying Bilal's contractual obligation
identifying his failure to perform as the breach
recognising that Amina required replacement performance because of that breach
connecting the additional £600 directly to Bilal's failure
concluding that causation is likely to be satisfied, subject to remoteness and mitigation before ultimate recovery
Question 5
Award up to 5 marks for:
identifying Dylan's breach
recognising that Cara claims loss of profit
applying the independent power failure
recognising that production could not have occurred even if Dylan had performed
concluding that the claimed lost profit has a serious causation problem and is unlikely to be recoverable from Dylan on these facts
Question 6
Award up to 5 marks for:
identifying the contractual breach concerning suitability of the suitcase
connecting the oversized suitcase with the £25 airport charge
concluding that causation is satisfied
applying Hadley v Baxendale to remoteness
recognising that Emma Travel knew Deeta required a cabin-sized suitcase and, as a travel business, could reasonably understand the financial consequences of an oversized item
concluding that the £25 is unlikely to be too remote
This reflects the approach accepted in AQA's 2025 mark scheme.
Question 7
Award up to 10 marks for a reasoned answer including:
identifying George's breach as the starting point
establishing whether failure to provide the vehicle factually caused Haris to lose the transaction
recognising that causation and remoteness must be considered separately
explaining the significance of Hadley v Baxendale
identifying the relevant time as when the contract was formed
noting that George knew the vehicle was required for ordinary business deliveries
recognising that George knew nothing of the highly unusual separate transaction
explaining that an ordinary commercial loss may be more readily connected with the known purpose
distinguishing the exceptional £30,000 consequence
concluding that, even if causation is established, the £30,000 is likely to face a strong remoteness objection because the special circumstances were unknown
Question 8
Award up to 10 marks for a reasoned application including:
£500 replacement hire
Jacob Ltd's failure to supply the lorry caused Imani Ltd to seek replacement transport
the £500 therefore has a clear causal connection with the breach
Jacob Ltd knew it was supplying a lorry for a scheduled machinery delivery
replacement transport is closely connected with the known contractual purpose
the £500 is therefore unlikely to be too remote
£4,000 lost profit
failure to provide the lorry prevented Imani Ltd completing its customer delivery, establishing a possible causal link
remoteness requires application of Hadley v Baxendale
Jacob Ltd was expressly told that the lorry was required to deliver machinery to a customer by a deadline
this knowledge supports an argument that commercial profit or loss resulting from failure to complete that delivery was within the risks of breach
the £4,000 may therefore also satisfy remoteness, subject to the detailed evidence and the separate requirement of mitigation [Lesson 156. Mitigation]
A strong response will analyse the two losses individually rather than merely conclude that "damages are available".
Question 9
Award up to 10 marks for a reasoned answer including:
£250 vehicle hire
the prolonged retention of Kara's car may have caused the need for alternative transport
there is therefore a credible causal connection
a garage may reasonably understand that keeping a customer's car for an extended period can require substitute transport
this provides a plausible argument that the expense is not too remote
mitigation will still need to be considered
£100 taxi to the private appointment
the delay may also factually have caused Kara to use the taxi
causation may therefore be satisfied
however, remoteness must be considered separately
the particular private appointment may be a circumstance of which Leo knew nothing
the question is what Leo knew or ought reasonably to have known at formation about the likely need for this expense
the £100 therefore presents a more arguable remoteness issue
The answer should not automatically allow or reject either expense. Higher-level analysis distinguishes causation, remoteness and the later issue of mitigation.
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