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Last November, Arizona’s Court of Appeals issued a memorandum decision analyzing Arizona’s Prompt Pay Act. Though the decision was not published and is not binding authority, it does guide the construction industry and practitioners as to how this court analyzed Prompt Pay Act enforcement.
To set the table,
was limited to a payment dispute between the general contractor Shea Connelly, and its subcontractor, Revive. The project owners effectively had no role in the dispute.
Critically for Shea Connelly’s arguments, Revive was hired to provide framing work on two separate Arizona projects, one in Glendale, and one in Fountain Hills called Park Place. The Glendale subcontract included a cross-default term providing that if Revive defaulted on any subcontract with Shea Connelly, it would be deemed to have defaulted on all of its subcontracts with Shea Connelly.