NOTICE: NOT FOR OFFICIAL PUBLICATION. 

UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL 

AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.

IN THE 

ARIZONA COURT OF APPEALS

DIVISION ONE

MTR BUILDERS, INC., an Arizona corporation, 

Plaintiff/Counterdefendant/Appellee/Cross-Appellant,

v.

JAHAN REALTY MANAGEMENT CORPORATION, 

Defendant/Counterclaimant/Appellant/Cross-Appellee. 

No. 1 CA-CV 14-0650 

Appeal from the Superior Court in Maricopa County 

No. CV2011-007463 

The Honorable Maria Del Mar Verdin, Judge, Retired 

The Honorable James T. Blomo, Judge 

AFFIRMED 

COUNSEL 

Dickinson Wright PLLC, Phoenix 

By Denise H. Troy 

Counsel for Plaintiff/Counterdefendant/Appellee/Cross-Appellant 

Wilenchik & Bartness PC, Phoenix 

By Dennis I. Wilenchik and Tyler Q. Swensen 

Counsel for Defendant/Counterclaimant/Appellant/Cross-Appellee
MTR BUILDERS v. JAHAN 

Decision of the Court 

2

MEMORANDUM DECISION 

Presiding Judge Andrew W. Gould delivered the decision of the Court, in 

which Judge John C. Gemmill and Judge Margaret H. Downie joined. 

G O U L D, Judge: 

¶1 MTR Builders Inc. (“Contractor”) and Jahan Realty 

Management Corporation (“Owner”) both appeal from a jury verdict 

declaring Owner breached the parties’ contract and awarding Contractor 

$52,129.18 in damages. For the following reasons we affirm the verdict and 

rulings of the trial court. 

FACTS AND PROCEDURAL BACKGROUND 

¶2 In December 2009, Owner and Contractor entered a 

construction contract to build a shell building for retail space in Tempe. 

The construction contract contained a draw schedule of five progress 

payments outlining the amounts Owner would pay Contractor at 

predetermined stages of construction.1 The project progressed and 

Contractor reached completion of the fifth and final phase of construction. 

¶3 On June 1, 2011, Contractor emailed Owner with an invoice 

seeking payment of Draw 5 and requesting a final walkthrough. Owner 

responded via email on June 10 stating that a few outstanding matters 

needed to be resolved pursuant to the contract before scheduling a final 

walkthrough; Owner requested issuance of a Certificate of Occupancy by 

the City of Tempe and final written approval by the Owner’s appointed 

third-party inspector. 

¶4 Owner and its architect, who acted as the third-party 

inspector, walked through the building and created a punch list that was 

sent to Contractor on June 29, 2011. Contractor responded on July 12, 

stating (1) it had remedied all punch-list items for which it was 

contractually responsible, and (2) requesting Owner’s inspector to reinspect the property and issue final approval. However, the inspector 

 

1 During the course of construction the parties signed an amendment 

to the contract extending the completion date and increasing payment to 

Contractor for various change orders. 
MTR BUILDERS v. JAHAN 

Decision of the Court 

3

declined to re-inspect the property unless at Owner’s direction, explaining 

that he could not sign a certificate of substantial completion without a 

certificate of completion first being issued by Tempe. 

¶5 On July 24, 2011, Contractor informed Owner that it needed a 

certificate of special inspection to be signed by Owner before Tempe would 

issue a certificate of completion.2 In the communication, Contractor again 

requested payment for the work it had performed in the amount of 

$59,224.18. 

¶6 The parties continued to disagree over some items required 

to complete the contract. Owner required Contractor to test and balance 

A/C units it installed. Contractor maintained that any outstanding items 

were warranty items that would be remedied after Owner paid the final 

payment in completion of the contract. Owner also requested Contractor 

to provide an unconditional lien waiver indemnifying Owner from any 

subcontractor claims. 

¶7 At one point, Owner obtained a certified check in the amount 

Contractor was requesting for final payment, and the only outstanding 

issue appeared to be Contractor’s lien waivers. Additionally, the record 

shows the City of Tempe did issue a certificate of completion, although both 

parties were unable to produce the document at trial, and Owner continued 

to demand that Contractor provide it.3 

¶8 Ultimately, the parties’ differences could not be resolved and 

communication between them broke down. Contractor then filed a 

complaint for breach of contract against Owner on August 3, 2011. 

¶9 Contractor’s complaint alleged Owner had breached its 

contract, Owner was unjustly enriched thereby, and Owner had violated 

the Prompt Pay Act in failing to pay Contractor’s invoice. Owner replied 

 

2 Although the contract refers to a certificate of occupancy, both 

parties agree that what was actually required was a certificate of 

completion. The building is a shell building that would not be occupied 

until tenant improvements were performed; therefore, completion of 

Contractor’s work on the building would be marked by a certificate of 

completion. 

3 We conclude that a certificate of completion was finally issued 

because Owner admitted it was able to occupy the property. 
MTR BUILDERS v. JAHAN 

Decision of the Court 

4

and filed a counterclaim alleging Contractor was the party who had 

breached. 

¶10 Before trial, the parties filed cross-motions for summary 

judgment on Contractor’s Prompt Pay Act claim. Contractor argued it 

submitted an invoice requesting final payment pursuant to the Act on June 

1, 2011, and Owner had failed to provide a written objection to the billing 

within the required time. Owner responded that Contractor’s request for 

final payment was premature. Additionally, Owner claimed it did object 

to Contractor’s requested billing in its June 10 email response and the punch 

list generated by its inspector on June 29. Owner also sought dismissal of 

the unjust enrichment claim because a contract governed the parties’ 

relationship. 

¶11 The court granted summary judgment for Owner on both the 

Prompt Pay Act and the unjust enrichment claims. The court concluded 

that Contractor’s request for final payment was premature and that Owner 

had timely objected in its email and punch list. 

¶12 Just before start of trial, Owner filed a motion for judgment as 

a matter of law. Owner argued the contract contained conditions precedent 

to final payment that precluded Contractor from prevailing on its breach of 

contract claim. Owner asserted that Contractor did not obtain the thirdparty inspector’s final approval or the City of Tempe’s certificate of 

completion before seeking final payment. Thus, under American Continental 

Life Insurance Co. v. Ranier Construction Co., 125 Ariz. 53 (1980), Owner 

concluded it was entitled to judgment as a matter of law. 

¶13 The court denied Owner’s motion and proceeded with the 

trial. During trial, Contractor presented evidence that it had substantially 

performed its duties under the contract. Further, Contractor showed that 

the City of Tempe eventually issued a certificate of completion, and Owner 

was able to occupy the premises. Owner’s expert testified that Contractor 

had grossly deviated from the contract and the cost of required repairs 

exceeded the amount of the final payment. Contractor’s rebuttal expert 

countered that many of the complained-of deficiencies were minor and 

incidental to any construction project. 

¶14 Having found there was sufficient evidence to support both 

parties’ breach of contract theories, the court instructed the jury on 

substantial performance and anticipatory breach. The jury returned a 

verdict in favor of Contractor on its breach of contract claim and awarded 
MTR BUILDERS v. JAHAN 

Decision of the Court 

5

$52,129.18 in damages; the jury also entered a verdict denying Owner’s 

breach of contract claim against Contractor. 

¶15 The court entered judgment in accordance with the jury 

verdicts and awarded Contractor $105,000 in attorneys’ fees. Owner 

renewed its Rule 50(b) motion, requesting the court direct a verdict in its 

favor pursuant to Ranier. The court denied Owner’s motion. 

¶16 Owner appealed the denial of its Rule 50(b) motions. 

Contractor cross-appealed the grant of summary judgment to Owner on the 

Prompt Pay Act claim. 

DISCUSSION 

I. Summary Judgment Award 

¶17 “We review an award of summary judgment de novo, both as 

to whether there are any genuine issues of material fact and as to whether 

the moving party is entitled to judgment as a matter of law.” Greenwood v. 

State, 217 Ariz. 438, 442, ¶ 13 (App. 2008). “[W]e view the facts in a light 

most favorable to the party opposing the motion.” Nelson v. Phoenix Resort 

Corp., 181 Ariz. 188, 191 (App. 1994). We will affirm if the trial court’s ruling 

is correct for any reason. Hawkins v. State, 183 Ariz. 100, 103 (App. 1995). 

¶18 The trial court granted Owner’s motion for summary 

judgment on the Prompt Pay Act claim. It concluded that Contractor’s 

request for payment was premature and that Owner timely objected to the 

request for payment. On cross-appeal, Contractor argues the trial court 

erred in granting summary judgment to Owner. Contractor contends 

Owner never issued a written statement within the terms of the act to notify 

Contractor it would not approve the billing. 

¶19 Under the Prompt Pay Act an owner is required to make final 

payment to the contractor “within seven days after the billing or estimate 

for final payment is certified and approved.” Arizona Revised Statutes 

(“A.R.S.”) § 32-1129.01(A). The contractor shall submit its billing “[o]n final 

completion of the work.” A.R.S. § 32-1129.01(K). The Act defines “final 

completion” to mean either (1) when the work “has been completed in 

accordance with the terms and conditions of the construction contract,” or 

(2) the “date of final inspection and final written acceptance by the 

governmental body that issues the building permit.” A.R.S. § 32-

1129(A)(3). 
MTR BUILDERS v. JAHAN 

Decision of the Court 

6

¶20 The terms of the parties’ contract provide that payment for 

Draw 5 would be made after the contractor finished “plumbing, electrical . 

. . and any other work to complete the Project and obtain the Certificate of 

Occupancy.” The contract also states that draw payments would be 

disbursed subject to the satisfaction of a third-party inspector to be 

designated by Owner. The contract reiterates that “Draw 5 may be 

withheld pending final approval by the City of Tempe and the third-party 

inspector, which will then result in receiving the Certificate of Occupancy.” 

¶21 Thus, under both the contract and the Prompt Pay Act, 

Contractor could not submit a billing for Draw 5 before obtaining final 

approval of the third-party inspector and of the City of Tempe as evidenced 

by a Certificate of Completion. The record reflects that neither occurred 

before Contractor submitted its invoice seeking payment of Draw 5 on June 

1, 2011. 

¶22 At the time Contractor submitted its request for payment of 

Draw 5, the Owner’s inspector had not performed a walkthrough and the 

City of Tempe had not issued a certificate of completion. Accordingly, 

under the Prompt Pay Act, Contractor’s request for payment was 

premature; the trial court properly granted summary judgment to Owner 

on Contractor’s Prompt Pay Act claim.

¶23 On appeal, Owner reasons the court’s ruling denying 

Contractor’s Prompt Pay Act claim is tantamount to a finding that Owner 

did not breach the contract. We disagree. 

¶24 The primary purpose of the Prompt Pay Act is to establish a 

framework for ensuring timely payments from the owner to the contractor. 

Stonecreek Bldg. Co. Inc., v. Shure, 216 Ariz. 36, 39, ¶ 16 (App. 2007). The Act 

does not displace other contractual remedies available to the parties; rather, 

the Prompt Pay Act affords a remedy for enforcement of construction 

contracts in addition to any other breach of contract remedy available to a 

contractor. Thus, the court’s grant of summary judgment against 

Contractor on its Prompt Pay Act claim did not prohibit Contractor from 

seeking damages for breach of contract. 

II. Denial of Rule 50(b) Motion 

¶25 We review the court’s ruling on a motion for directed verdict 

de novo. Dawson v. Withycombe, 216 Ariz. 84, 95, ¶ 25 (App. 2007). In our 

review, “we view the evidence and all reasonable inferences drawn from 

the evidence in a light most favorable to the non-moving party, and will 

reverse a court’s denial only upon a showing that there is no probative 
MTR BUILDERS v. JAHAN 

Decision of the Court 

7

evidence in the record to support the ultimate verdict.” Id. “When the terms 

of a contract are plain and unambiguous, its interpretation is a question of 

law” subject to de novo review. ELM Retirement Ctr., LP v. Callaway, 226 

Ariz. 287, 291, ¶ 15 (App. 2010); Grosvenor Holdings, L.C. v. Figueroa, 222 

Ariz. 588, 593, ¶ 9 (App. 2009). 

¶26 Owner relies on Ranier, to argue the trial court erred in 

denying its Rule 50(b) motion for directed verdict on Contractor’s breach of 

contract claim. In Ranier, the court enforced a condition precedent to final 

payment in the construction contract and denied final payment to the 

contractor. 125 Ariz. at 54-55. The parties’ contract expressly conditioned 

payment on issuance of a final certificate for payment by the architect. Id. 

at 55. Because the contractor did not obtain a final certificate for payment, 

the court found that the owner was entitled to a directed verdict on its 

breach of contract claim against the contractor. Id. at 56-57. Accordingly, 

the court reversed a jury verdict in the contractor’s favor and directed the 

trial court to enter judgment in the owner’s favor. Id. at 57. 

¶27 The facts of this case and the facts of Ranier are similar. 

However, the holding in Ranier specifically relied upon the express, 

unambiguous contract language stating that payment was required 

“provided that . . . a final Certificate for Payment has been issued by the 

Architect.” Ranier, 125 Ariz. at 55. Accordingly, Ranier only requires a 

directed verdict for Owner in this case if the subject contract expressly 

conditions payment on the alleged conditions precedent. 

¶28 “As a general rule conditions precedent are not favored and 

the courts are not inclined to construe a contractual provision as a condition 

precedent unless such construction is plainly and unambiguously required 

by the language of the contract.” Watson Constr. Co. v. Reppel Steel & Supply 

Co., 123 Ariz. 138, 140 (App. 1979); see also Valley Nat’l Bank of Ariz. v. Cotton 

Growers Hail Ins., Inc., 155 Ariz. 526, 528 (App. 1987). To create a condition 

precedent “there must be contractual language demonstrating the parties’ 

unequivocal intent” to do so. L. Harvey Concrete, Inc. v. Agro Constr. & 

Supply Co., 189 Ariz. 178, 182 (App. 1997). The language must demonstrate 

that payment is only required upon satisfaction of that condition, and that 

failure to satisfy the condition precludes any right to payment. See Watson, 

123 Ariz. at 142. To determine what the parties intended, we “consider the 

plain meaning of the words in the context of the contract as a whole.” 

Figueroa, 222 Ariz. at 593, ¶ 9. 

¶29 Owner contends that final approval by its third-party 

inspector, issuance of a certificate of completion by the City of Tempe, and 
MTR BUILDERS v. JAHAN 

Decision of the Court 

8

signing of lien waivers on behalf of subcontractors are conditions precedent 

to the payment Contractor sought. Owner relies on a number of provisions 

of the contract in support of its condition-precedent argument. Section 2.3 

states “[s]ubject to the inspector’s satisfaction, each draw will be 

disbursed.” Section 3.1 states “Owner will make payments to the contractor 

pursuant to the attached construction draw schedule as work required by 

said schedule is satisfactorily completed per the Inspector’s satisfaction.” 

Additionally, the contract states “Draw 5 may be withheld pending final 

approval by the City of Tempe and the third-party inspector.” Finally, the 

contract amendment provides “future draw releases or payments will 

require a conditional lien waiver signed by all subcontractors and MTR.”4 

¶30 However, the contract contains other provisions under which 

Contractor can seek payment. In section 3.2 the contract expressly provides 

that in the event either party terminates the contract Owner remains 

obligated to pay Contractor for “that part of the work performed to the 

satisfaction of [the third-party] inspector.” Section 12.1 provides that 

should either party fail to carry out the contract, “with all of its provisions,”

the non-defaulting party may proceed for breach of contract and seek its 

damages. Thus, the contract language, when viewed as a whole, is not a 

strict condition precedent contract. Miller v. Crouse, 19 Ariz. App. 268, 273-

74 (1973) (stating that where the contract provides the remedy for breach or 

termination of contract, the terms of the contract control). 

¶31 Contrary to Owner’s assertions, Contractor’s breach of 

contract claim is not simply a claim for payment of Draw 5, and therefore 

limited to section 3.1 of the contract. Rather, Contractor’s claim reaches 

beyond payment of Draw 5 and seeks damages for breach of contract in the 

amount of $59,224.18. The claim is for Contractor’s damages caused by 

Owner’s breach of the contract pursuant to section 12.1 of the contract. 

¶32 This distinction is significant. In the event that either party 

should default and fail to carry out its obligations under the contract, the 

non-defaulting party is given the option to sue for breach of contract. 

Thus, although there are conditions under section 3.1 that may preclude 

Contractor from demanding payment of Draw 5, in the event of a breach, 

sections 12.1 and 3.2 of the contract provide that Contractor is still entitled 

 

4 Owner incorrectly asserts the contract required Contractor to 

provide unconditional lien waivers. The contract language clearly provides 

that conditional lien waivers be signed by subcontractors and by 

Contractor. Furthermore, the contract does not expressly condition 

payment of any draw on the lien waivers. 
MTR BUILDERS v. JAHAN 

Decision of the Court 

9

to seek damages for breach of contract. These contract provisions clearly 

govern the dispute between Owner and Contractor. 

¶33 Thus, when viewed as a whole, the contract does not plainly 

and unambiguously create conditions precedent for Contractor to seek 

damages for breach of contract; accordingly, Ranier does not control. The 

court correctly denied Owner’s Rule 50(b) motions. See Gardner v. Royal 

Dev. Co., 11 Ariz. App. 447, 449 (1970) (stating that reviewing court will 

assume court made necessary findings to support its ruling). 

III. Trial Court’s Jury Instructions

¶34 “In determining whether a jury instruction is justified, we 

must view the evidence in the strongest manner supporting the theory of 

the party requesting the instruction.” Pioneer Roofing Co. v. Mardian Constr. 

Co., 152 Ariz. 455, 462 (App. 1986). The instruction should be given if there 

is “any evidence tending to establish” the theory, “even if contradictory 

facts are also presented.” Id.

¶35 Owner argues the court erred in instructing the jurors they 

could find in favor of Contractor if they found Contractor had substantially 

performed the contract.5 Owner also contends Contractor anticipatorily 

repudiated the contract when it prematurely sought final payment thereby 

freeing Owner of any obligation to further perform. 

¶36 The court properly instructed the jury on both substantial 

performance and anticipatory breach. Evidence was presented at trial that 

could support either theory. See Golonka v. General Motors Corp., 204 Ariz. 

 

5 Owner also argues interpretation of the contract, a legal 

determination, was improperly sent to the jury. “When the terms of a 

contract are plain and unambiguous, its interpretation is a question of law 

for the court.” Callaway, 226 Ariz. at 291, ¶ 15. However, if the court 

determines the “contract language is reasonably susceptible to more than 

one interpretation,” “determination of the intent of contracting parties from 

extrinsic evidence may require fact finding.” In re Estate of Lamparella, 210 

Ariz. 246, 250, ¶ 21 (App. 2005). Here, the court determined the contract 

was ambiguous as to the parties’ intent to condition Contractor’s right to 

payment on satisfaction of certain conditions. Having done so, it was 

proper to submit the issue to the jury. 
MTR BUILDERS v. JAHAN 

Decision of the Court 

10

575, 593, ¶ 64 (App. 2003). “It is for the jury to find the facts and apply the 

instructions to the facts as they find them.” Pioneer Roofing, 152 Ariz. at 462. 

CONCLUSION 

¶37 The trial court properly dismissed Contractor’s Prompt Pay 

Act claim on summary judgment and allowed Contractor’s breach of 

contract claim to go to the jury. We also affirm the jury’s verdict in 

Contractor’s favor and the trial court’s award of attorneys’ fees. 

¶38 Both parties have requested their fees on appeal. Owner 

requested fees under A.R.S. § 12-341.01. Although Owner successfully 

defended Contractor’s cross-appeal, Owner was unsuccessful on its appeal. 

Therefore, in our discretion we decline to award it fees. 

¶39 Contractor requested fees both under A.R.S. § 12-341.01 and 

pursuant to the contract. The parties’ contract provides that a nondefaulting party may recover reasonable attorneys’ fees resulting from the 

other party’s breach. Thus, upon compliance with ARCAP 21, Contractor 

is entitled to its reasonable fees incurred to pursue the appeal. Because 

Contractor was unsuccessful on its cross-appeal, any fees incurred in 

pursuance of the cross-appeal should not be included in Contractor’s 

request.