Delaware sues housing community developer, alleging fraud

DOVER, Del. (AP) — Delaware’s attorney general has filed a lawsuit against the developer of a senior housing community following an investigation into alleged fraudulent practices affecting prospective homebuyers and current residents.

The lawsuit, filed Thursday in Chancery Court, targets developer Harry Miller III and various entities under his control in the development and management of the Villages of Noble’s Pond, an age-restricted “55-plus” community just north of Dover.

State officials allege that Miller’s development company, Regal Builders LLC, requires home buyers to enter into deed restrictions that are confusing, misrepresent or omit material facts and include terms and conditions that violate state or federal law.

The lawsuit alleges that those contracts enable Regal Builders and its affiliates to dominate community governance and exploit Noble’s Pond residents, forcing them to buy telecommunications and propane services through companies owned by Miller, often at a substantial markup.

The lawsuit also alleges that Regal Builders falsely portrays the development’s clubhouse as a community amenity, even though it is privately owned and residents have no say in its management.

The complaint alleges multiple violations of Delaware’s Consumer Fraud Act, Deceptive Trade Practices Act and other state consumer protection laws.

According to the lawsuit, Regal Builders began marketing single-family homes in Noble’s Pond more than 10 years ago and has built and sold more than 220 homes to date.

“The record plans for Noble’s Pond indicate that Regal Builders intends to build nearly 900 homes in all — a total that would make Noble’s Pond one of the largest planned communities in Delaware,” the lawsuit states.

Attorney General Kathleen Jennings said her office began its investigation after receiving dozens of complaints from homeowners who did not receive what had been advertised to them.

In addition to Regal Builders and Miller, defendants in the lawsuit include Galaxy Networks LLC, County Propane of Delmarva LLC and other entities owned or controlled by Miller.

Miller did not immediately return a message left at his office Friday. A secretary said he was out of town.