Problem
Li in China and Sally in Australia contract for the sale of 15,000 inflatable toys. The sale is on EXW (Li's Factory, Shanghai Industrial Park, Shanghai) Incoterm.
On 16 August Li informs Sally that the goods are ready for pick up from his factory. Sally arranges pick up for the 17 August. On the evening of 16 August there is a freak gas explosion outside Li's factory. The factory (and toys) are destroyed by fire.
1. Problem: Goods destroyed
2. Legal problem: Were the goods delivered, Who carried the risk?
3. Refer to Incoterm for our delivery terms/obligations
a. When is delivery by Li complete?
b. When does the risk pass?
c. Apply to the facts
i. Has Li delivered the goods?
ii. Were the toys destroyed after the risk passed?