We have a slow paying customer. We didn't receive our September progress payment until late December. Whats left is retention.
1 reply
Jan 26, 2018
Unfortunately, the Arizona retainage statute is unclear as to how to recover improperly withheld retainage. However, as that retainage represents payment owed and unpaid for the performance of work, it follows that a lien might be filed for unpaid amounts. Of course, the work would have to be lienable work and all other requirements for filing a lien would also have to be adhered to (such as timing and notice requirements - both of which can be found here at our Arizona FAQs). Keep in mind that if the retainage is being validly withheld, retainage payments might not be due and a lien claim might not be an appropriate remedy. Anyway, prior to filing a lien, we have found that sending a notice of intent to lien and prompt payment demand is generally the best method for encouraging parties to make payment. However, keep an eye the deadline for filing a lien - once that date passes, recovery options might be limited. That lien filing deadline will be 120 days of completion of the improvement or 60 days after a Notice of Completion is recorded (if recorded).