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Business Law Case Study: Burg-Go

Haris is qualified yet inept electrician, and the director and majority shareholder of Burg-Go Sdn. Bhd. (Burg-Go). Burg-Go purports to specialise in installing burglar alarms.

In fact, Haris has had little success in installing alarms, and now has several disgruntled customers. In particular, one of Burg-Go's customers, Alex, is threatening legal action against Burg-Go as the result of his alarm failing to go off when a burglar broke open his front door and stole his priceless stamp collection. The police report confirmed that the intruder had not deactivated the burglar system.

Haris is concerned that Alex could be "difficult" so he transfers the assets from Burg-Go to a new company which he controls called Stop-Burg Sdn. Bhd. Shortly after this transaction, Burg-Go is wound up. Alex wants compensation for the loss of his stamp collection, but Burg-Go has no assets. What possible legal arguments could Alex make in order to get judgment against Haris and Stop-Burg Sdn. Bhd.? Discuss.

Solution Preview

In a situation of this nature, Alex has a very strong case against Harris. A supporting circumstance in favor of Alex is the fact that a burglar was able to break into his front door and steal his stamp collection, while this property was supposed to be protected by the burglar alarm installed by Harris. In addition, law enforcement has made the determination that the intruder had not deactivated the ...