Customers burned by bankrupt solar firm get some welcome relief

By Daniel Rothberg

Friday, Aug. 5, 2016 | 2 a.m.

When Richard Gilliam first contracted Summerlin Energy to install solar panels on his roof last fall, he had no problem with the company. Four months later, that all changed when Gilliam ended up with a $20,323 lien on his home from a supplier Summerlin Energy had failed to pay.

“It really sucks,” Gilliam said after a Nevada State Contractors Board meeting on Thursday.

After several turbulent months and the fatal shooting of a company leader on Thanksgiving, the Las Vegas-based solar company filed for bankruptcy in February, leaving more than $4 million in liabilities, about $1 million in debt to suppliers and customers without their solar panels. The closure of Summerlin Energy triggered one of the largest investigatory cases in state history.

Some homeowners were left having paid for panels the company never installed. Others, like Gilliam, received solar panels but were later assessed liens because under Nevada law, suppliers are allowed to file liens against a customer’s property if they haven’t been paid by a contractor. This put customers in the situation of paying twice — first for the panels and again for the lien.

On Thursday, 133 homeowners received some relief with the board awarding them a collective $400,000, the maximum the board can distribute for complaints against a single contractor.

“To be able to provide homeowners financial recourse after they have been taken advantage of by a licensed contractor underscores the importance of the board’s mission,” Margi A. Grein, the board’s executive officer, said in a statement after the award was approved by a committee.

Of the more than 50 homeowners present, many expressed relief they were at least getting some assistance on the liens or funds Summerlin Energy owed. But many were frustrated that they were still taking a loss. Since the board’s relief fund is capped at $400,000, the board could not cover each entire claim. For all 133 homeowners, the board identified over $1 million in claims.

Miguel Velazquez is one such customer. Sun Valley Electric Supply, which claims to have sold over $700,000 of solar panels and materials to Summerlin Energy, slapped a lien on his home.

According to the board, Velazquez, 65, will receive about 38 percent of his $5,642 claim.

“What am I going to do for the rest of it?” he asked.

A lawyer for Las Vegas-based Sun Valley Electric Supply said the company, which assessed roughly 100 liens, has settled with some of the customers. Donald Williams, the attorney, would not say whether those customers paid the full amount of the lien or a lower negotiated amount.

“We are working very hard with homeowners to try to resolve the issues,” he said.

When Summerlin Energy declared bankruptcy, it claimed about $680,000 in property, and a court-appointed trustee said most creditors were unlikely to be paid back. The board’s probe of the company remains active, and one official left open the possibility of a criminal proceeding.

On Thanksgiving Day, Henry Bankey, the apparent CEO of Summerlin Energy, was fatally shot after a dispute with his ex-wife. At the hearing, some questioned why Summerlin Energy had been allowed a license, given that Bankey had been indicted on felony charges in 2007. The contractors board said that although it conducts background checks when companies apply for licenses, Bankey’s name was not associated with Summerlin Energy’s license.

“If he was here today, he’d have a lot of problems,” said Paul Rosario, the board’s director of investigations. “He’s not here to answer questions and the concerns of the homeowners.”

Summerlin Energy was not present at the meeting.

It is unclear what led to the company’s bankruptcy, but between November and February, Summerlin Energy missed several payments to contractors, Clark County records show. At the time of its bankruptcy filing in February, the company listed $2,112 in its checking accounts and $676,484 in accounts receivables. It owed $4,215,560 to customers, workers and suppliers.

In its bankruptcy filings, it also listed five additional limited-liability companies ­­— Summerlin Energy New Mexico, Summerlin Energy Arizona, Summerlin Energy Riverside and Summerlin Energy El Paso. As of March, the contractors board in California was looking into Summerlin Energy and at least one complaint had been reported against the company in Arizona.