Robert is a qualified yet inadequate electrician, and the sole director and shareholder of Burg-Go Pty Ltd (Burg-Go). Burg-Go purports to specialize in installing burglar alarms. In fact, Robert has had little success in installing alarms, and now has several disgruntled customers. In particular, one of Burg-Go's customers, Patrick, 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. Robert is concerned that Patrick could be “difficult” so he transfers the assets from Burg-Go to a new company which he controls called Stop-Burg Pty Ltd. Shortly after this transaction, Burg-Go is wound up.
Patrick wants compensation for the loss of his stamp collection, but Burg-Go has no assets. Please advise what possible legal arguments could Patrick make in order to get judgment against Robert and Stop-Burg Pty Ltd?
This question belongs to business and corporate law and discusses about a given case study that describes possible legal arguments against compensation for the loss of goods.
Total word count: 281
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