Pine Haven park owner faces $800,000 in penalties

Delaware Attorney General Kathy Jennings has obtained a preliminary victory for residents of the Pine Haven manufactured home community after the community owner, Blue Beach Bungalows DE LLC, violated statutory protections afforded to the residents.

Even so, many of the lots in the park are vacant, and many residents have moved out.

An administrative hearing officer issued an opinion April 4 finding that Blue Beach has “willfully violated” Delaware’s Consumer Fraud Act, among other laws, and ordered the company to pay more than $800,000 in penalties, along with rebates of excess rent paid by residents.  Blue Beach has 30 days to appeal the order.  

“Owners of manufactured home communities should consider themselves on notice,” Jennings said. “Exploiting vulnerable Delawareans with threats and lies is not something manufactured home community owners can expect to get away with.”   

In April 2023, after receiving numerous complaints from residents, Jennings’ Consumer Protection Unit issued a cease-and-desist order requiring Blue Beach to refrain from making false statements to residents and evicting residents in violation of the law, among other actions.

Those complaints included failing septic cesspools and unsafe drinking water. Residents were also hit with a $100 increase in monthly rent.

The cease-and-desist order was accompanied by a complaint detailing how residents were subjected to illegal rent increases, illegally threatened with eviction and arrest, and, in some cases, forced out of their homes prematurely. An administrative proceeding followed, culminating in an administrative hearing in September 2023.    

Hearing officer Jameson Tweedie noted that despite being operated as a manufactured home community with numerous year-round residents, the park owner repeatedly made false and misleading claims as to the nature of the park as a seasonal park as justification for taking action against residents.

The owners have been ordered to rebate all tenants and former tenants any excess rental payments and awarded an administrative penalty of $737,000 for willful violations of the Consumer Fraud Act, as well as a penalty of $94,000 for violations of the cease-and-desist order.

A three-year ordeal

The action follows a three-year ordeal by the residents who live in manufactured/RV park at 22506 Corey Drive near Lincoln. Residents complained about conditions in the park for several years before any action was taken. 

On June 20, 2022, the previous owner gave residents 60 days to vacate the park or face arrest, prosecution and confiscation of their personal property. That deadline continued to be extended until the park was sold.

After Blue Beach purchased the property in September 2022, residents received the following letter: “We are happy to inform you that we are the new owners of Pine Haven Campground. We are going to continue to operate Pine Haven in accordance with its legal permitting as a seasonal community. We understand that there are some residents that were misled by the former owner’s operations and believe that this community is a year-round facility. It is simply not. Under seasonal operation, the utility services would terminate by Nov. 15 of each year. However, we know that because some of you have made your permanent home in Pine Haven with no knowledge of the seasonal limitation of the community, we are going to work with you so that we can help ease you through this transition back to seasonal. Thus we will not discontinue utility services at your home until Nov. 15, 2025. This will allow you three years to find another permanent residence.”

Pine Haven is located near Argos Corner and Lincoln off Route 1 adjacent to Yogi Bear's Jellystone Park-Delaware, which is owned by Blue Water Development Corporation of Ocean City, Md., the parent company of Blue Beach Bungalows. 

As of press time, the owners did not respond to a request for comments.

House Bill 374

On July 22, 2022, the governor signed into law House Bill 374, which, among other things, expanded the definition of a manufactured home to certain camper trailers, recreational vehicles and motor homes.

A number of the Pine Haven RV tenants whom Blue Beach is attempting to evict are covered by that amendment, the hearing officer wrote.

Manufactured housing complaints can be made to the Office of the Manufactured Housing ombudsperson by calling the hotline at 800-220-5424.