Penalties for using an illegal construction contract in Arizona:
- Failure to note an alternate billing cycle allows an award of interest and attorney fees to the successful party if suit is necessary.
- Failure to provide two copies of the notice required by Arizona's Home Solicitation and Referral Sale Act, Revised Statutes § 44-5001 to § 44-5008, is a third degree misdemeanor punishable by a fine up to $500 (Arizona Revised Statutes § 13-802) and imprisonment for up to 30 days (Arizona Revised Statutes § 13-707-A). Failure to provide two copies of the required notice also voids the contract. Arizona Revised Statutes § 44-5004. The Act applies regardless of whether the type of construction is residential or commercial.
- For swimming pool and spa contracts, failure to provide the notices required by Arizona Revised Statutes § 32-1158.01 and § 44-5004 constitute grounds for revocation of a contractor’s license.
- Failure to make federal truth-in-lending disclosures requires restitution of the overcharge.
- Failure to include the disclosures required by 12 Code of Federal Regulations § 226.15 extends the right of rescission to three years (rather than three days).
- Omitting insulation disclosures required by 16 Code of Federal Regulations § 460 can result in an $11,000 fine.
The contracts linked below will help Arizona contractors avoid these penalties by complying with state and federal law.
The contracts linked below also comply with current Arizona and federal court decisions.
The contracts linked below comply with the following Arizona and federal laws:
- Arizona Revised Statutes § 12-341.01 (recovery of attorney fees)
- Arizona Revised Statutes § 12-552 (statute of limitations)
- Arizona Revised Statutes 23-906 (workers' compensation insurance)
- Arizona Revised Statutes 32-1129 (progress payments and alternate billing cycle)
- Arizona Revised Statutes 32-1129.01(K) (interest on unpaid balances)
- Arizona Revised Statutes 32-1129.05 (choice of law)
- Arizona Revised Statutes 32-1159 (indemnity)
- Arizona Revised Statutes 33-1003 (mechanics liens)
- Arizona Revised Statutes 33-981 (mechanics liens)
- Arizona Revised Statutes 33-992 (mechanics liens)
- Arizona Revised Statutes 34-221 (payment on public works projects)
- Arizona Revised Statutes 41-2577 (payment on public works projects)
- 15 United States Code § 1638 (truth-in-lending)
- 12 Code of Federal Regulations § 226.15 (right of rescission)
- 16 Code of Federal Regulations § 460 (insulation disclosure)
Return to Penalties for Illegal Contracts in Arizona.
The contracts linked below conform with current Arizona and federal court decisions.
The contracts linked below comply with the following Arizona and federal court decisions:
- Indemnity - Allison Steel Manufacturing v. Superior Court, 523 P.2d 803, 1974
- Liquidated damages - Larson-Hegstrom & Associates v. Jeffries, 145 Ariz. 329, 1985
- Cost of delay - Mechanical Air Engineering v. Totem Construction, 166 Ariz. 191, 1989, Roscoe-Gill v. Newman, 188 Ariz. 483, 1996
- Pay only if paid - L. Harvey Concrete v. Agro Construction & Supply, 189 Ariz. 178, 1997
- Required changes - Willamette Crushing Company v. Arizona, 188 Ariz. 79, 1997
- Plan defects - Chaney Building Co. v. City Of Tucson, 148 Ariz. 571, 1986
- Warranty - Nastri v. Wood Bros. Homes, 142 Ariz. 439, 1984
- Statute of limitations - Woodward v. Chirco Construction. Co., 141 Ariz. 514, 1984
Return to Penalties for Illegal Contracts in Arizona.
Return to construction contract laws in Arizona.
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