Board Update on Legal Matters and 2025 Legal Expenses
Board Update on Legal Matters and 2025 Legal Expenses
Dear NLYH Members,
Several residents have reached out with questions regarding current legal matters, and the Board would like to provide a brief update. As mentioned during the October 2025 Board meeting of litigation, there are three residents involved in pending legal matters with NLYH.
NLYH does have insurance coverage in place and has notified its carrier of the matters raised, and we are working with them should coverage be needed.
The Board remains mindful of its responsibility to respect legal and confidentiality requirements and will share additional information when appropriate. We will not comment on the merits, strategy, or confidential communications while matters are pending, and we ask to refrain from speculation or public commentary that could prejudice NLYH’s position.
Legal expenses for 2025 totaled $152,615.48. These costs include the three legal matters, one eviction, and other routine legal services. These expenditures were necessary to enforce duly adopted Bylaws and rules and to defend the corporation against claims; failing to do so would increase risk and potential costs to all shareholders.
The Board has been duly elected to operate the corporation and is responsible for enforcing the Bylaws and rules of NLYH, as well as overseeing the corporation’s financial decisions. These legal expenditures are part of the approved operating budget, which was reviewed and voted on as a whole. In making these decisions, the Board acts in good faith, on an informed basis, and in the best interests of the corporation, standards commonly known as the business judgment rule, and will continue to do so. Line‑item legal spending may fluctuate as needs arise, but the total budget was approved by the membership and is being managed within that authority.
Importantly, the Board has also achieved significant savings in other areas through prudent financial management. For example, maintenance currently reflects a surplus of over $100,000, sales efforts have generated over $100,000 and investments have produced $124,000 in additional revenue. Additional operating categories have also performed favorably. Taken together, this reflects prudent stewardship: addressing necessary legal matters while driving operational efficiencies to mitigate the overall impact on the budget.
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Ron Thomas
NLYH Secretary