California Wholesale Material Supply, Inc. v. Norm Wilson & Sons, Inc.

Defendant and appellant Norm Wilson & Sons, Inc. (Wilson) appeals an order denying its motion for attorney fees following a court trial wherein it successfully defended an action brought by plaintiff and respondent California Wholesale Material Supply, Inc., doing business as CalPly (CalPly) for collection of accounts receivable. Wilson also appeals an order granting a motion by CalPly to tax attorney fees as an item of costs.

After the judgment for Wilson was entered, the essential issue remaining is whether the subject action by CalPly arose out of a contract containing an attorney fee clause, namely, the subcontract between Wilson and Johnwall Interiors, Inc. (Johnwall), so as to entitle Wilson, as the prevailing party, to attorney fees.

Pursuant to a security agreement, Johnwall had granted a security interest in the Wilson/Johnwall subcontract and in its accounts receivable to a creditor, CalPly. Following Johnwall’s default, CalPly, as a secured party and Johnwall’s assignee, sued Wilson to collect the money Johnwall had earned under the subcontract. Consequently, CalPly’s collection action against Wilson arose out of the subcontract. Wilson defeated CalPly’s…