Ok, I stand corrected, but that's beside the point.
The person's mark was not affected by a single person, it was affected by the whole cohort. The mean of the exam marks is factored in, and as you said above,
It was not raised only due to the distribution; it was raised because the mean of the exam marks was higher than the mean of the school marks. Moderation is based on the performance of all students, and a person's mark was affected by the performance of all students. You can't have it both ways, whether it's 2 students at the top, or a student at the bottom.
But you are looking at this in a black and white case. You are claiming a person did not perform to expectation but what measure is there for expectation? Why must it be that student A performed below expectation, and not that student B performed above expectation? It's expected that student A does the best, and you described student A as beating student B by 1%, so that expectation is met. So how can you objectively claim that student B achieved to 'expectation' and student A didn't?
The scenario you just mentioned is ridiculous. You are assuming the exact same assessment was conducted at both schools, where the quality of teaching is exactly the same, that the influences of others in both schools affect that student in the exact same way, and that they were the worst student at that school as well. Seriously, does your question still warrant a response?