A decade ago, the Arizona Court of Appeals held that “the primary purpose of [Arizona’s Prompt Pay] Act is to establish a framework for ensuring timely payments from the owner to the contractor and down the line to the subcontractors and suppliers whose work has been approved.” Stonecreek Bldg. Co., Inc. v. Shure, 216 Ariz. 36, 39 (App. 2007) (emphasis added). But just recently in Zumar Industries, Inc. v. Caymus Corp., No. 1 CA-CV 16-0423, the Court of Appeals was tasked with deciding whether the Act still applied to a “down the line” relationship on a federal work project, where there was, by statute, no preceding “owner-contractor” relationship. The Court held that the Act did not apply in these circumstances.
The Arizona Court of Appeals recently addressed the scope of Arizona’s Prompt Payment Act in RSP Architects, Ltd. v. Five Star Development Resort Communities, LLC, 306 P.3d 93, 232 Ariz. 436 (App. 2013). Specifically, the court was tasked with determining whether an architect performing an architectural services contract was a “contractor” entitled to protection under the Act. Consistent with the ordinary definitions of “architect” and “contractor,” the court ultimately held that the Act does not apply to architectural service contracts. But the case was not as straightforward as one might have expected.