Laverne got a small shop on the corner of East Street from her grandfather who use to run his little barbershop downtown for many years during the 1970s and the 1980s. The shop was a little run-down, so Laverne had to fix it up and repurposed it to suit a hairdressing business that she wanted to do as a sole proprietor. Laverne bought some state of the art equipment and furnishings to make the shop take on a modern state-of-the-art look. Her friend Gwendolyn told her, that given how pricey the contents were, that she should make sure to insure everything with a nearby general insurance company in the event that she should lose them by theft, fire or otherwise. Laverne did just that, and at the same time insured the car that she had also just purchased for use in the business, to make house calls as a part of the service that she plan to offer to her high end clients.

The business prospered and within two years Laverne had amassed a lot of savings that caused her to consider expanding her business. She did just that, and again she listened to her friend Gwendolyn who told her to incorporate the business so that if anything should happen, she does not lose her home in Norbrook Heights. Having incorporated her business, she named it Sublime Beauty & Personal Care Limited and took the following steps:

1. She transferred all the assets, including the car, of her sole proprietor business over

Sublime Beauty.

2. Sublime Beauty employed staff and had them sign no-competition contracts in the event they should leave, forbidding them from taking or receiving any of her clients.

3. She used some cash transferred to the account of Sublime to pave the driveway at her Norbrook home just as she used to do with cash from her sole trader business.

Advise Laverne on each of the following situations:

(i) Thieves have broken into the shop and made off with the expensive equipment insured in Laverns name that she had transferred to the company. The thieves used the company car parked on the premises to transport the stolen property. She now wants to make a claim on the insurers.

(ii) One of her supervisors has left her employment and has started their own business. The supervisor created a company Grab Dem Limited and used it to take away a lot of Sublime Beautys clients.

(iii) The company, having suffered the losses it has, is now in financial difficulties and the creditors want a liquidator to take action against Laverne for the funds she took from her business to take care of her home affairs now that the business cannot pay them outstanding monies owed to them for services and supplies.