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Causation in Insurance Contract Law

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CHAPTER 7 Causation and machinery for qualifying losses

Introduction

In tort, the defendant is liable for the consequences of the actual damage attributable to the breach of duty. Exceptions to that rule are that the link is too weak because of remoteness or the lack of foreseeability. The but-for test in tort needs a judgement of the moral impact, so that the defendant will not be liable for the loss beyond foreseeability, owing to its behaviour.1 Stapleton claims that a tort was part of the history of the injurious outcome of which the plaintiff complains; and that this outcome was within the appropriate “scope of liability for consequences” under the relevant rule in the circumstances of the case.2 The role of the “scope of liability” in defining liability is critical in every legal obligation, because the law's concern that a defendant should not be held liable for the infinite stream of consequences flowing from tortious conduct requires the limitation of every obligation to a finite set of consequences.3

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