OPINION
Thе primary issue on appeal is whether the trial court erroneously dismissed plaintiffs’ amended claim against the interplead-ers for a violation of the Arizona Bulk Sales Transfer Act, A.R.S. § 47-6101 et seq., (bulk sales act), based on the court’s conclusion that the statute of limitations imposed by the act had run. The cross-appeal raises issues whether defending against a violation of the bulk sales act is an action arising out of contract so as to allow the interpleaders attorneys’ fees against plaintiffs, and whether interplead-ers were entitled to setoff against the in-terpled funds their judgment for attorneys’ fees against defendants arising from a stipulated judgment on their crossclaim. We affirm.
Facts and Procedural Background
In July 1982, Michael J. O’Keefe and Theresa A. O’Keefe (plaintiffs) entered into a contract (management agreement) with William E. Conry and Lyvia Conry (defendants), which provided that defendants would manage a business owned by plaintiffs known as Convenient Food Mart. The management agreement, as amended, also provided defendants with an option to purchase the business for $50,000 but provided that until defendants had paid fifty-one percent of the purchase price, plaintiffs would retain title to the store franchise, the fixtures and equipment, and all inventory. Defendants exercised this option to purchase in March 1984, but did not make payments exceeding fifty-one percent of the $50,000 price.
On February 18,1987, defendants agreed to sell the business to Gary Grenke, Jean Grenke, Brian Winstanley, and Lori Win-stanley (collectively, interpleaders) for $90,-000; $60,000 to be paid upon transfer and
Bulk Sales Act: The Sellers state and agree that the only outstanding debts associated with the business are listed on Exhibit “D”. Sellers agree that they will be responsible for all of these outstanding debts and any other debt, including tax debts the Sellers may have incurred in relation to the business____ Sellers further agree they shall comply with the Bulk Sales Act.
Exhibit “D” listed the following creditors:
1. Pepsi Cola $ 800.00
2. Central Arizona Distributing Co. 125.00
3. Salt River Project (Last month’s utilities) 1,100.00
These creditors were paid from the proceeds of the sale. No notice of the transfer was sent to plaintiffs, and defendants did not pay the balance of the $50,000 option price to plaintiffs.
On March 28,1987, an agent of plaintiffs discovered that the business had been sold to interpleaders. On May 15, 1987, plaintiffs filed suit against defendants alleging breach of the management agreement, conversion/trespass, racketeering, fraudulent concealment and nondisclosure, and sought issuance of provisional remedies (garnishment and attachment). This complaint named no other parties, although it did allege that the Grenkes and the Winstan-leys were “subsequent purchasers,” and attached a U.C.C. financing statement and security agreement that named the inter-pleaders as the transferees. The complaint requested damages in the amount of $90,-000, and sought attachment of the security interest to satisfy the judgment.
On June 23, 1987, plaintiffs amended the complaint to add a sixth count, alleging that the sale constituted a bulk transfer as defined by A.R.S. § 47-6101, that defendants violated the bulk sales act by failing to supply a list of creditors and failing to give proper notice of the transfer, and that' interpleaders knew or had reason to know that defendants owed a debt to plaintiffs at the time of the transfer. The complaint requested “an order voiding the purported sale ... from the Conrys to the Grenkes and Winstanleys,” “an order of attachment allowing the O’Keefes to proceed against any and all of the property transferred in violation of the Bulk Sales Transfer Act,” and attorneys’ fees and costs. The amended complaint again did not formally join the interpleaders as parties, but did add fictitious defendants “whose true identity or role in this lawsuit is unknown at present.” Plaintiffs sent a copy of this complaint to the interpleaders on June 23, 1987, and again on July 24, 1987, together with letters from plaintiffs’ attorney advising in-terpleaders that their property interest in the business may be affected by the suit, and advising them to seek legal advice.
On September 11, 1987, interpleaders filed a “Motion for Joinder and Motion for Interpleader,” requesting that the court join them to the suit “for the purposes of interpleading certain funds pursuant to Rule 22,” Arizona Rules of Civil Procedure. They requested permissive joinder under Rule 20(a), for the reason that “if plaintiffs are successful it will presumably affect or may affect the intervenors’ ownership of the fixtures, some goods and the store itself.” They further stated that “it may be that the ongoing monthly payments should in fact be paid to the plaintiffs,” and requested “that the court enter its order allowing the moving parties to pay the ongoing payments into a restricted savings account and that said funds not be disbursed without a Court Order. This action would insure that the party who has a right to the money would in fact receive it.”
Plaintiffs responded that they had no objection to the joinder of interpleaders, but for the first time requested that inter-pleaders be joined as defendants for the purposes of the bulk sales claim. Plain
On December 11, 1987, plaintiffs filed their second amended complaint, naming interpleaders as defendants only on the bulk sales claim, retaining the fictitious defendants, and requesting the same relief as requested in the first amended complaint.
Interpleaders filed an answer, admitting that the sale constituted a bulk transfer; asserting, among other affirmative defenses, that the statute of limitations had run; and requesting attorneys’ fees and costs against plaintiff, but not stating a basis for that request. Interpleaders also filed a crossclaim against defendants, asserting that defendants were obligated under the terms of the purchase agreement to be responsible for all debts associated with the business and for compliance with the bulk sales act, and therefore interpleaders would be entitled to a setoff on the promissory note and on funds already paid to defendants pursuant to the original contract “for that amount that cross-claimants are found to be liable to the plaintiffs herein.” Interpleaders also requested attorneys’ fees against defendants pursuant to A.R.S. § 12-341.01.
Interpleaders then sought and received leave to file an amended answer, which added defenses to the other counts of the second amended complaint, although no relief was sought against them on those counts.
On April 4, 1988, a default judgment was entered on interpleaders’ crossclaim against defendants. On April 6, 1988, a stipulated judgment was entered against defendants in interpleaders’ favor, as follows:
1. Interpleaders/Cross-claimants herein shall have Judgment against the Defendants/Cross-defendants in an amount equal to that which the Cross-claimants are required to pay to Plaintiffs in chief____
2. The Judgment shall include the principal sum and interest to be paid to the Plaintiffs herein along with the actual attorneys^] fees and costs incurred by Interpleaders/Cross-claimants in defense of their claim in this action.
3. The foregoing shall accrue interest at the legal rate until paid.
Plaintiffs then filed a motion for partial summary judgment against interpleaders, requesting a ruling that the transfer violated the bulk sales act on the basis that the list of creditors did not comply with the statutory requirements and no notice of sale was sent to any creditor. The inter-pleaders responded, conceding that the statutory notice requirements were not met, but asserting that plaintiffs’ action against interpleaders was barred by the six-month statute of limitations in A.R.S. § 47-6111, and cross-moved for summary judgment on that ground. Plaintiffs replied that the statute of limitations did not bar their action because the second amended complaint relatеd back to a date within the statute of limitations, pursuant to Rule 15(c), Arizona Rules of Civil Procedure. Interpleaders’ reply put in issue this contention.
After several hearings, additional discovery and a request by the court to brief the issue whether noncompliance with the statutory notice requirements constituted “concealment” of the transfer, which would toll the statute of limitations until plaintiffs discovered the transfer on March 28, 1987, the court held that the transfer was not “concealed” within the meaning of A.R.S. § 47-6111 for purposes of tolling the statute of limitations, that plaintiffs’ second amended complaint did not relate back to a date within the statute of limitations, and that the interpleaders were therefore entitled to summary judgment on the bulk sales claim because plaintiffs’ action against them was time-barred.
Subsequently, the court, in the action between plaintiffs and defendants (to which interpleaders were not a party), entered a stipulated judgment. in favor of plaintiffs against defendants on the conversion count, dismissing “all other pending
Interpleaders filed a motion to set aside the stipulated judgment, claiming that they had a “priority entitlement to the funds in the restricted account” because they prevailed against plaintiffs on the bulk sales claim, and stating:
Interpleaders now claim a right to a set-off and/or recoupment of funds in the bank account as payment for successfully defending against the Bulk Transfer claim together with the balance of payments on the $30,000.00 promissory note in connection with its successful motion for Summary Judgment on the Bulk Transfer issue.
Interpleaders also noted that they had previously obtained a judgment against defendants, had prevailed in obtaining summary judgment against plaintiffs, and had concurrently filed an application for attorneys’ fees against plaintiffs. After a hearing on the motion 1 the court ruled as follows:
Based upon the oral argument, the Court ruled that the interpled funds belong to the plaintiffs, and further ruled that neither the settlement agreement nor any judgment entered in this case affects any recoupment,.setoff, or similar claim that the interpleaders may assert as a defense to payment of the promissory note.
After further briefing and additional oral argument, the court denied interpleaders’ motion for attorneys’ fees against plaintiffs, but granted their motion for attorneys’ fees against defendants. On April 7, 1989, the trial court entered its “Judgment re: Attorneys’ Fees (v. [defendants]),” awarding intеrpleaders $20,046.75 in attorneys’ fees against defendants pursuant to A.R.S. § 12-341.01, and awarding $666.90 as taxable costs. On May 5, 1989, the court entered its “Judgment (v. [plaintiffs] )” in interpleaders’ favor against plaintiffs, dismissing the second amended complaint against interpleaders with prejudice, awarding $2,492.40 attributable to attorneys’ fees previously granted arising out of plaintiffs’ withdrawal of their motion for leave to file a third amended complaint, awarding $666.90 in taxable costs, and denying attorneys’ fees pursuant to A.R.S. § 12-341.01.
Plaintiffs timely appealed from the judgment in interpleaders’ favor on the bulk sales claim. Interpleaders have cross-appealed from the denial of attorneys’ fees against plaintiffs under A.R.S. § 12-341.01 and from the court’s refusal to allow them a priority entitlement to the interpled funds to satisfy their judgment against defendants.
Discussion
I. Issues on Appeal
A. Relation-Back of Amended Complaint
Plaintiffs argue that the trial court erred in holding that their second amended complaint, filed December 11, 1987, did not relate back to a date within the six-months statute of limitations. 2 Rule 15(c), Arizona Rules of Civil Procedure, provides:
Whenever the claim or defense asserted in the amended pleading arose out of the conduct, transaction, or occurrence set forth or attempted to be set forth in the original pleading, the amendment relatesback to the original date of the original pleading. An amendment changing the party against whom a claim is asserted relates back if the foregoing provision is satisfied and, within the period provided by law for commencing the action against the party to be brought in by amendment, that party, (1) has received such notice of the institution of the action that the party will not be prejudiced in maintaining a defense on the merits, and (2) knew or should have known that, but for a mistake concerning the identities of the proper party, the action would have been brought against the party.
See also Watts v. State,
Thе parties do not seriously dispute that the first two requirements of the rule have been met: (1) the bulk sales claim arose from the same transaction as the sale of the business claims set forth in the original complaint, (2) interpleaders received written notice of the institution of that action shortly after it was filed. The only issue remaining is whether the amendment naming the interpleaders as defendants on the bulk sales claim was a result of a “mistake” concerning their identities. In the trial court, plaintiffs contended that the omission of the interpleaders as parties in the first amended complaint, filed within the statutory period,
was as a result of the inadvertence and mistake of [plaintiffs’] counsel in interpreting the reach of the bulk sales provisions of the U.C.C. Specifically, [plaintiffs’] counsel incorrectly determined that the Interpleaders did not have to be named in order for a lien to bе placed upon the property transferred in the subject sale. "
Plaintiffs attached an affidavit from counsel, which stated as follows:
3. Prior to September, 1987, ... co-counsel in this action instructed me to research the specific issue of whether [interpleaders] had to be named to this action, in order for [a] lien to be placed upon the property transferred in the transaction which is the subject of this matter.
4. After researching this issue, I erroneously concluded that the Interplead-ers did not have to be named. The statute of limitations thereafter ran against the Interpleaders.
5. After the statute of limitations had run, I determined that my previous conclusion was in error and immediately moved to add the Interpleaders to this action.
6. The Interpleaders did not object to being added to this action and the Plaintiffs’ Second Amended Complaint was filed on December 11, 1987.
7. If [сo-counsel] had received proper counsel from myself on this issue, the Interpleaders would have been named in the original Complaint, as well as the First Amended Complaint.
Plaintiffs thus admit that the “mistake” in not naming interpleaders as defendants on the bulk sales claim in their first amended complaint was a result of an erroneous conclusion of law by their counsel. Further, it is clear that by naming interplead-ers as the subsequent purchasers in both the original complaint and the first amended complaint that plaintiffs knew of the existence and identities of these parties from the time they commenced this action. The issue is thus directly presented as to whether the failure to name interpleaders as the result of a “mistake as to the necessity for naming them,” meets the requirements of Rule 15(c).
In our opinion, a “mistake concerning the identities of the proper party” does not include a mistake of law by counsel regarding whom to name in a lawsuit. If such a broad reading of Rule 15(c) were adopted, it would unreasonably extend the statute of limitations in a limitless number of cases in which legal counsel made strategic, conscious, tactical choices, although erroneous, about whom to sue initially, and then changed their minds after the statute of limitations had run.
The proper interpretation of the rule is that widely adopted in other federal and state courts: Where a plaintiff knows
Furthermore, under Rule 15(c), plaintiffs are required to establish that the interpleaders “knew or should have known” that, but for that “mistake,” they would have been sued. Notice of the suit does not necessarily establish that knowledge.
See, e.g., Bisaillon v. Casares,
Because plaintiffs failed to meet the “mistake of identity” requirement of Rule 15(c), the trial court correctly refused to allow plaintiffs’ second amended complaint to relate back to defeat the interpleaders’ statute of limitations defense.
B. Waiver of Defense by Joinder/In-terpleader
Plaintiffs alternatively argue that, even if their second amended complaint does not relate back to a date within the six-month statute of limitations, interpleaders are estopped from asserting the statute of limitations defense because it was waived by voluntarily moving to join the suit before the statute of limitations had run. We disagree.
Because an answer can be amended at any time prior to trial with permission of the court, a statute of limitations defense is waived only if not asserted prior to judgment.
Transamerica Ins. Co. v. Trout,
In this case, interpleaders’ motion to join for the purpose of interpleading the funds at issue in the lawsuit was not a responsive pleading that required them to assert any defenses to a claim that at this point in the proceedings had not been brought against them. We find no “waiver” of the statute of limitations defense.
C. Noncompliance as “Concealment” Under the Bulk Sales Act
The parties’ primary dispute in the trial court and on appeal is the date on which the applicable six-month statute of limitations for the bulk sales claim began to run. The relevant statute provides:
No action under this chapter shall be brought or levy made more than six months after the date on which the transferee took possession of the goods unless the transfer has been concealed. If the transfer has been concealed, actions may be brought or levies made within six .months after its discovery.
A.R.S. § 47-6111 (emphasis added).
The dispositive dates are undisputed: the transferee took possession on February 18, 1987; plaintiffs’ discovery of the transfer occurred on March 28, 1987; plaintiffs’ complaint naming interpleaders on the bulk sales claim was filed on December 11,1987. Plaintiffs argue that because the transfer was “concealed” by failure to comply with the requirements of the bulk sales act, the statute of limitations did not begin to run until they discovered the transfer on March 28, 1987. Therefore, their amended complaint was not barred by the statute of limitations. 3 On the other hand, interplead-ers contend that mere noncompliance with the notice provisions of the bulk sales act, alone, does not constitute the “conсealment” necessary to extend the statute of limitations to six months from plaintiffs’ discovery of the transfer. Rather, they argue that some affirmative act or intentional deception of the transfer is required to keep the fact of the sale from plaintiffs, of which there is no evidence in this case.
First, we agree that there is no evidence in this record that either the transferor or the transferee in this bulk sale performed any “positive acts ... to prevent detection” by “trick or contrivance to exclude suspicion and prevent inquiry,” under the traditional definition of “concealment” in other contexts outside the bulk sales act.
See Tovrea Land & Cattle Co. v. Linsenmeyer,
We therefore must decide whether the “conceаlment” necessary under A.R.S. § 47-6111 to extend the running of the statute of limitations requires something more than mere noncompliance with the notice provisions of the bulk sales act. This issue is one of first impression in
To determine this question, a review of the notice provisions of the bulk sales act is in order. A bulk transfer is ineffective against any creditor of the transferor unless the transferee gives proper notice of the transfer to that creditor at least ten days prior to payment or possession. A.R.S. § 47-6105. The notice must state that the transfer is about to be made, the names and business addresses of the trans-feror and transferee, and whether the debts are to be paid in full upon transfer. A.R.S. § 47-6107. The notice must be personally delivered or sent by registerеd or certified mail to the creditors on the list. A.R.S. § 47-6104. The parties do not dispute that this was a bulk transfer to which this requirement applied, and that proper notice was not given to plaintiffs. 4 Additionally, the parties concede that the other creditors named on Exhibit D to the purchase contract were paid in full at the time of transfer. 5
Some jurisdictions have held that total noncompliance with the notice provisions of the bulk sales act constitutes the “concealment” necessary to toll the running of the statute of limitations to the date that a creditor discovers the transfer, without requiring any showing of any other acts by the transferor or transferee to hide the transfer.
See, e.g., Carpenter, Bennett & Morrissey v. Jones,
Other jurisdictions hold that something more than mere notice noncompliance is necessary to constitute concealment of a bulk sale.
See e.g., Matter of Borba,
We believe the better-reasoned view is taken by courts that hold that the “concealment” required to extend the running of the statute of limitations to the date the creditor discovers the transfer requires more than mere noncompliance with the notice provisions of the bulk sales act. The bulk sales act clearly provides three different time periods in which a creditor may bring suit, depending on the circumstances. First, if the creditor has received proper notice, it has ten days prior to the transfer to protect its interest. A.R.S. § 47-6105. Second, if the creditor does not receive notice, it has six months from the date of the transferee’s possession to take action. A.R.S. § 47-6111. Third, if the transfer has been concealed, the creditor has six months from discovery of the transfer to take action. Id. We agree with those cases that note that if we were to interpret “concealment” as including failure to give notice, we would render meaningless the language in A.R.S. § 47-6111 referring to the six months from the date of the transferee’s possession. We would also distort the ordinary definition of “conceal” from meaning “to prevent disclosure or recognition of; to place out of sight” to mean something more, without any legislative intent of such a broad interpretation. See Webster’s New Collegiate Dictionary (1981).
The position we adopt has been supported by prominent commentators as well:
Under this concealment exception, we believe that only a buyer who knowingly and willingly withholds notice of the transfer, i.e., acts in bad faith, should be denied the benefit of a short statute of limitations. In our view, so long as buyers act in good faith, they should be entitled to the benefit of a short statute of limitations, even though they completely fail to give notice under Article Six.
J. White and R. Summers, 2 Uniform Commercial Code § 20-4 at 117 (3d ed. 1988). We agree with the reasons given for this position. First, bad faith can be proven by evidence that the buyer knowingly and willingly withheld notice. Second, contrary to those courts that have adopted the “complete failure rule” on the basis that the legislative intent was to protect creditors against fraudulent transfers, in our opinion, there exist two competing goals of the bulk sales act: to protect creditors from fraudulent transfers and to protect innocent transferees from stale creditоr claims. Id. at 117-18. Those combined purposes are best served, in our opinion, by this interpretation. It is important not only that creditors be protected but also that transferees enjoy the right to continue the operation of the purchased business after a reasonable period of time without fear of creditor claims. Third, extending the limitations period against a transferee without a showing of bad faith “does not lessen the chance of fraud by the transferor. It does not provide the creditor with notice, it simply punishes the unwary transferee.” Id. at 118. Finally, the drafters’ intent was to minimize “the possibility of a trap for the unwary buyer”; however, applying the “complete failure” rule to good faith transferees “would widen the trap without lessening the danger of fraud,” which contradicts that intent. Id.
Apparently the drafters of the uniform law also agree with this position. The current version of the limitаtions period for bulk sales claims, set forth in 2A Uniform Laws Annotated § 6-110 (Supp.1991), specifically states: “Complete noncompliance with the requirements of this article does not of itself constitute concealment.” We believe our interpretation of “concealment” in A.R.S. § 47-6111 is a tacit recognition of this standard.
We hold, therefore, that the interplead-ers’ failure to comply with the notice requirements of A.R.S. § 47-6111, without further evidence of any act or omission calculated to hide the transfer from these plaintiffs, did not constitute “concealment” within the meaning of A.R.S. § 47-6111 that would extend the statute of limitations to six months after plaintiffs discovered the transfer. The trial court thus correctly concluded that plaintiffs’ amended claim for interpleaders’ violation of the bulk sales
II. Issues on Cross-Appeal
A. Interpleaders’ Priority Rights to Interpled Funds
On cross-appeal, interpleaders argue, as they did in the trial court, that they had a priority right to setoff against the interpled funds the judgment they were awarded against defendants “on their breach of warranty claim.” We find that interplead-ers neither asserted a “breach of warranty" claim against defendants nor presented any other claim that would entitle them to a right of setoff against the interpled funds.
Interpleaders included in their amended answer an affirmative defense of setoff to the bulk sales claim, as follows:
In the event it is determined that there is a debt owed to Plaintiffs by Defendants and said amount represents a lien on the property acquired by Interpleaders, the Interpleaders are entitled to setoff of that amount to the extent the Interplead-ers paid debts owed by Plaintiffs to third parties____
No lien on the property occurred as a result of any of the four judgments entered in this case, so this request does not entitle interpleaders to any right of setoff on that basis.
In addition, in their crossclaim, inter-pleaders requested the following relief against defendants:
1. That in the event [Interpleaders are] found to be liable to Plaintiffs, or in the event [Interpleaders are] assessed a lien on the personal property acquired pursuant to the Purchase Contract, then [In-terpleaders] be awarded a Judgment against [Defendants] in the amount of said lien.
2. That in the event [Interpleaders are] required to make payment to Plaintiffs herein [Interpleaders] have a setoff of any amounts owed to Plaintiffs from the funds placed in the Court Ordered bank account and pursuant to the Promissory Note described herein.
3. For reasonable attorneys’ fees.
As to the first request, interpleaders were not found to be liable to plaintiffs, as the amended bulk sales clаim was dismissed as untimely, and they were not named defendants on any of the other counts in the complaint. As we have already noted, no lien was placed on the business. As to the second request, no setoff was necessary as affirmative relief because no judgment was entered against interpleaders in plaintiffs’ favor. As to the third request, interplead-ers were awarded attorneys’ fees against defendants, but did not claim any right to setoff that award against any interpled funds. Interpleaders had no right to setoff the judgment for attorneys’ fees owed by defendants to them from the funds found by the court to be owed by defendants to plaintiffs.
Interpleaders also argue that they have a priority entitlement to the interpled funds “since [interpleaders] prevailed by summary judgment on the Plaintiff’s sixth claim for relief in the second amended complaint,” (the bulk sales claim). However, interpleaders did not rеceive any money judgment on this claim, nor did they assert any affirmative claim against plaintiffs on that action. Interpleaders also argued that they had “prevailed” on the other counts against defendants, but they were not named parties on those counts, which were dismissed as a result of a stipulation between plaintiffs and defendants on the conversion count. We simply find no basis in this record for interpleaders’ entitlement to setoff of any portion of the interpled funds on any theory against plaintiffs.
As the trial court correctly noted, the judgments in this case did not bar any future “recoupment, setoff, or similar claim that the interpleaders may assert as a defense to payment of the promissory note.” The interpleaders’ right to setoff against plaintiffs is clearly not raised in this lawsuit. We do not determine if such a claim of setoff may arise if interpleaders fail to make payments on the promissory
B. Attorneys’ Fees Pursuant to A.R.S. § 12-341.01(A)
Interpleaders also cross-appeal from the trial court’s denial of their request for attorneys’ fees against plaintiffs, based on their successful defense of the bulk sales claim, contending that such a claim is embraced within A.R.S. § 12-341.01(A), which provides:
In any contested action arising out of a contract, express or implied, the court may award the successful party reasonable attorney’s fees.
The trial court denied interpleaders any attorneys’ fees against plaintiffs on the basis of A.R.S. § 12-341.01, finding that the bulk sales claim, on which interpleaders prevailed, arose out of a statutory claim, not contract. 6 We agree.
Interpleaders argue that A.R.S. § 12-341.01(A) is applicable bеcause, “but for” the management agreement and purchase contract involved in this case, no bulk sales claim would have arisen. Although conceding that they “prevailed upon an issue which did not itself concern a contract,” they argue that when a contract is “a factor” causing the dispute, the statute applies.
See Nationwide Mut. Ins. Co. v. Granillo,
In
Granillo,
Division Two of this court found A.R.S. § 12-341.01 applicable to successful defendants in a declaratory judgment action determining whether an insurance policy provided coverage. Although defendants were not a “party” to the contract, they prevailed on an issue involving “facts and law regarding the insurance contract,” аnd thus were entitled to attorneys’ fees.
Granillo,
In
Ash,
the prevailing party sought by special action to invalidate a contract. This court found A.R.S. § 12-341.01 applied because “the words ‘arising out of a contract’ describe an action in which a contract was a factor causing the dispute.”
Ash,
We also note that this case is unlike
Marcus v. Fox,
We find the cases cited by plaintiffs more analogous to this one.
See Morris v. Achen Constr. Co., Inc.,
[T]he contract in ASH was not merely “a factor”, but the factor giving rise to the litigation. We therefore do not construe the “factor test” adopted in ASH to mean that simply because a contract is peripherally involved in a cause of action, A.R.S. § 12-341.01(A) is always applicable.
Lewin,
We hold that the trial court properly found A.R.S. § 12-341.01 inapplicable to interpleaders’ request for attorneys’ fees against plaintiffs based on interpleaders’ successful defense of the bulk sales claim.
Interpleaders have requested attorneys’ fees for this appeal, presumably under the same theories they were denied in the trial court. For the same reasons that we affirm that denial, we deny their request.
For the foregoing reasons, we affirm the judgment of the trial court.
Notes
. Interpleaders have not provided this court with a transcript of this hearing as part of the record on cross-appeal.
. Plaintiffs’ original complaint, filed within six months of the transfer, contained no bulk sales claim and did not name interpleaders as defendants. Plaintiffs' first amended complaint, also filed within six months of the transfer, аdded the bulk sales claim, added fictitious defendants, but again did not name interpleaders as parties. Plaintiffs made no argument in the trial court that their second amended complaint, filed on December 11, 1987, more than six months after the transfer, was an attempt to "substitute” the interpleaders for the fictitious defendants, nor does the second amended complaint so indicate.
See generally Pima County
v.
Superior Court,
. Inherent in plaintiffs’ position is the argument that their motion for leave to file an amended complaint tolled the statute of limitations, because plaintiffs did not receive a ruling on that motion until after the statute had run under either party's theory. Because we conclude that the statute of limitations ran six months from the date the transferee took possession, we do not reach this issue.
. The parties did initially dispute whether plaintiffs were a “creditor" in this case, but that issue is not before us on appeal.
. We do not decide, as the trial court did, that this payment constituted either partial compliance with the notice provisions or informal notice of the sale that would negate a finding of concealment based on "total" or "complete” noncompliance in some jurisdictions.
See, e.g., SVM Investments v. Mexican Exporters, Inc.,
. The trial court granted interpleaders’ request for attorneys' fees against defendants pursuant to A.R.S. § 12-341.01(A), based on the contractual relationship between those parties. The trial court also awarded interpleaders attorneys’ fees against plaintiffs for those fees incurred in defense of plаintiffs’ motion for leave to file a third amended complaint, which was subsequently withdrawn. Those awards are not at issue in this appeal.
. Interpleaders point out that, in their amended answer, they defended defendants against the other five counts of the complaint. At oral argument in this court, interpleaders argued that, in reality, they had to defend those claims "in defendants’ shoes.” However, interpleaders were not named parties on the other five counts, and cannot now claim they were a prevailing party on contractual claims where no relief was sought against them.
Interpleaders also contend that they successfully obtained judgment against defendants based on a "breach of warranty” claim arising out of the purchase contract. As we have previously pointed out, the pleadings do not support this contention; interpleaders’ crossclaim against defendants sought nothing more than indemnity against defendants if plaintiffs prevailed against interpleaders, and attorneys’ fees against defendant, which they were awarded.