In Martinez, Eileen Horton’s dream is to build a two-bedroom ADU in her backyard for her two grandkids.
“They need a place to live because rent is so high,” she said.
Unfortunately for her, Horton hired Anchored Tiny Homes (ATH).
That’s the embattled ADU builder accused of taking unlawfully large down payments, then stalling or doing work but not paying subcontractors. Anchored’s CEO said he just mismanaged the business. Yet, sinking ATH left dozens of customers who paid up front, like Horton and her husband, holding the bag.
“We lost $30,000,” Horton said.
But she still needed an ADU. So, she turned to another builder: Nonna Homes. Horton said she and her husband didn’t do much research because they met with the owner.
“He sounded like he had compassion for us because of where we came from -- Anchored Tiny Homes -- and I trusted him," Horton said.
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The Hortons signed on. They said they gave Nonna $19,500 up front.
And then?
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Feeling ripped off – twice
“We got stuck in sanitation permitting for five months,” Horton said. “I sent a list of complaints to the owner of Nonna Homes, and I never heard back.”
The Horton household was reliving their Anchored Tiny Homes nightmare.
“It occurred to me that I was probably going to lose more money,” Horton said. “This can’t be happening again.”
Horton contacted NBC Bay Area Responds. Consumer Investigator Chris Chmura saw two red flags. First, Horton said nothing happened in her backyard for five months. Second, Nonna Homes took $19,500 up front. That’s 19 times the state limit of $1,000 on contractor deposits, including new ADUs, according to the Contractors State License Board.
Chmura contacted Nonna Homes, which is headquartered near Sacramento. Nonna attributed the Hortons’ delays to issues getting initial permits. As far as the $19,500 deposit -- 19 times the state cap -- Nonna contended it didn’t have to follow that limit because “the contract in question was not a home improvement contract but rather a preconstruction service agreement.”
Horton shared her contract, and NBC Bay Area Responds reviewed it. It doesn’t say “pre-construction” anywhere. Rather, its title is “ADU Contract.” The opening paragraph states the agreement is for “project management and construction services.” The contract then lists about a dozen steps from site prep to final permit.
Who's the contractor here?
Nonetheless, Nonna told NBC Bay Area Responds it believed the state’s $1,000 limit on deposits didn’t apply to Horton because, as far as they were concerned, she was serving as an “owner builder” – basically her own contractor. So, Chmura told Nonna he was heading back to Horton to ask if she knew that they considered her a contractor of sorts.
“No, I did not know that,” she said.
During Chmura's visit, there was a surprise: a Nonna representative showed up. He gave the Hortons a check for $19,500 – a full refund.
“I can’t believe what just happened,” Horton said.
Their case is closed.
“We no longer have a relationship with Nonna homes," Horton said. "We are finished.”
But Horton said she opened a case with the contractor board. She’s not alone. The agency just publicly disclosed several new consumer complaints about Nonna homes that the board said are under investigation for “probable violation” of state law, including:
- receiving or requesting more money than work completed,
- taking a down payment in excess of the state maximum of $1,000,
- and failure to pay subcontractors in a timely manner.
Nonna’s attorney told Chmura the company is trying to do “the right thing” with consumer complaints.
Subcontractors' protest escalates
As for subcontractors’ complaints, this story takes a turn.
“I have not received one penny from them,” East Bay contractor Andrei Melchner said.
He said he’s done several jobs for Nonna.
“I’ve basically helped them start some early phases of foundation work," he said.
He said the company owes him thousands of dollars.
“For work that I’ve delivered and haven’t been paid for, we’re in the neighborhood of about $55,000," he said.
Nonna said it “inadvertently executed a subcontractor agreement” with Melchner and wasn’t going to pay him.
This past Friday, Melchner and another contractor who said he’s also owed thousands, protested outside Nonna’s office. They said it ended with Nonna’s owner, Ray Guanill, in handcuffs.
Melchner recorded a video.
“We’re just here working and protesting because we just want to get paid, and you had to go and pull a gun on us,” he said.
Melchner said he called police. But NBC Bay Area does not know for sure what happened beforehand.
Guanill was later released. The Sacramento County District Attorney’s office said, “we declined to file charges at this time pending further investigation.”
Nonna’s attorney said the protest scared employees and the company is pondering a restraining order against Melchner.
Let’s circle back to Horton. While Chmura was still in her kitchen, her husband took the check to the bank. It cleared. So, Chmura asked, "What’s next?"
“Well, we’re still going to build,” she said. “We’re gonna build.”
Perhaps the third time’s a charm? Horton said she will not pay more than $1,000 up front this time. It’s a reminder for everyone: the state said the most a construction contractor can take from you up front is $1,000 or 10% of a job’s cost, whichever is less. It’s the law.
