Factual cause of the defendants loss
First, there is the issue of whether what the defendant did was the factual cause of the defendant’s loss. Secondly, there is the issue of whether, in certain cases, although the claimant’s loss is the factual result of the defendant’s actions, the law should nevertheless say that the defendant is not liable because that loss is too “remote" – in the sense that it is too unusual or “far removed" a consequence of the defendant’s actions.
The law’s starting point in determining causation is to apply the “but for" test. In other words, to ask the question “ Can it be said that ‘but for’ the defendant’s conduct, the claimant’s loss would not have occurred?" If yes, the defendant will not be liable.
In applying the “but for" test, the courts take into account not only existing causes that might have produced the claimant’s loss, but also hypothetical causes that might have produced the loss. The ‘but for’ test is applicable just to one defendant, not multiple!
Proof of causation
The “all or nothing" approach – the claimant must show that, on the balance of probabilities, it was the defendant’s breach that caused the loss. This is known as an “all or nothing" approach because, where a claimant succeeds in showing that it is probable (at least 51% likely) that the breach caused the loss, the law will treat this probability as a certainty, so the claimant will win the case and be compensated for all of the loss. If, on the other hand, a claimant can only show, say, a 25% likelihood that the breach caused the loss, the claimant will lose the case and leave court with nothing. In Hotson v East Berkshire Area Health Authority  A.C. 750 the plaintiff was taken to hospital after an accident, but his injury was not correctly diagnosed or treated for five days. As a result he suffered a condition that left him with severe permanent disability. Had the hospital treated him promptly when he was first admitted, the plaintiff would have had a 25% chance of making a full recovery. The House of Lords held that the plaintiff had failed to prove his case on the balance of probabilities. Nevertheless, the reasoning of the House was as to when the plaintiff’s disability occurred – when he fell from the tree. The law would treat this probability as a factual certainty, which meant that, by the time the plaintiff arrived at the hospital he was as a matter of decided fact already disabled. Thus, in effect, at this point in time the plaintiff had had no chance to lose. [See Stapleton article!]. He would have suffered that in any event.
Novus Actus Interveniens
In certain circumstances, where one act follows another, the law will say that the second act is to be regarded as the true cause of the damage, because it has “broken the chain of causation" and has extinguished the effect of the first act.
Natural or “instinctive" intervention – Scott v Shepherd (1773) 2 Wm. Bl. 892 the defendant threy a lighted firework into a market place. It landed on a stall belonging to a third party A, who threw it on so that it landed on the stall of a fourth party, B, who reacted in a similar way. The firework ultimately hit the plaintiff and injured him. It was held that neither the intervening act of A or B broke the casual connection between the defendant’s act and the subsequent damage. Both A and B had acted in an instinctive and natural way to avoid damage to themselves and their property.
Negligent intervention – Where A commits a tort, and B commits a subsequent tort, the key question is whether the nature of B’s tort is so powerful that it ought to be regarded as rendering A’s tort merely part of the surrounding historical circumstances. Thus, negligent conduct will not always break the chain of causation as in Roberts v Bettany  EWCA Civ 109.
In Knightley v Johns  1 All E.R. 851 the Court of Appeal stated that the relevant question to ask was whether the whole sequence of events was a natural and probable consequence of the defendant’s negligence, so that it should have been reasonably foreseen by the defendant, or whether the events were foreseeable only as a mere possibility. It is also to be considered whether the third party’s negligent intervention had involved a deliberate choice to do a positive act, as opposed to an error of judgment in the course of performing an act in which the third party was already engaged. Here, the conduct of the police had taken the form of a deliberate positive act, and was not reasonably foreseeable by the defendant. [driver collapses in a tune, police comes to investigate and sends a motorcycle police to stop the cars in the opposite direction – crashed.]
In Rouse v Squires  Q.B. 889 the defendant lory driver negligently caused an accident which blocked two lanes of a motorway. The plaintiff, who was assisting at the scen, was killed when a second lorry driver negligently drove into the obstruction. The CA held that the defendant was 25% to blame. The negligent driving of the second lorry driver did not break the chain of causation between the original accident ant the plaintiff’s death – a driver who caused an obstruction could be taken reasonably to foresee that a further accident might be caused by other drivers negligently colliding with the obstruction.
In Wright v Lodge  4 All E.R. 299 the second defendant was driving a Mini, when it broke down and came to stop in the near side lane. A few minutes later, as she was trying to restart her car, it was hit from behind by an articulated lorry being driven at 60 mph by the first defendant. The CA accepted the Mini driver was negligent, but held that the lorry driver’s dangerous driving was to be regarded as the true cause of the plaintiff’s injuries.
Remoteness of Damge
The modern law: The Wagon Mound (No 1) – the decision in Overseas Tankship (UK) Ltd v Morts Dock & Engineering Co Ltd  A.C. 388 was set that the proper test for remoteness of damage was “whether the defendant could have reasonably foreseen the kind of damage for which the plaintiffs were suing". Viscount Simonds explained the basis for the decision, saying “It does not seem constant with current ideas of justice or morality that for an act of negligence, however slight or venial, which results in some trivial foreseeable damage the actor should be liable for all consequences however unforeseeable and however grave…" (at p. 422).
Foreseeability of the “way the damage is caused" – in Hughes v Lord Advocate  A.C. 837 was held that the precise manner in which the damage was caused did not leave to be reasonably foreseen. So long as the defendant could reasonably foresee damage of the relevant “kind", the damage would not be too remote.
In the same case was also held that the defendant can be liable even when the damage caused is greater in extent than was reasonably foreseeable. Only where the damage is different in “kind" can the defendant escape liability.
The “Eggshell Skull" rule – the maxim “the defendant must take his victim as he finds him".