A recent Colorado case judgment1 where a condominium lost its hailstorm lawsuit and had to pay the insurance company attorneys fees, caught my attention. The judge ruled that the Association’s claims expert could not testify because the expert lacked credentials and a scientific basis for opinions.
The insurance company’s motion to strike the alleged expert, Jonna DiRito, made these winning allegations of fact to the court:
DiRito’s roofing experience was installing trusses with her father’s company in her early teens….DiRito then worked in various government positions unrelated to roofing for twenty-six years…. After leaving government, DiRito began managing websites for online car sales….DiRito and her business partner started ManageMyBackOffice, Inc. (‘MMBO’), a South Dakota corporation, in 2016 after leaving the car sales website business…. MMBO began helping a contractor in South Dakota manage its accounts receivable and accounts payable….MMBO went on to assist other South Dakota contractors with moving claim supplements through the insurance process. Through this experience, DiRito claims that she inspected roofs with adjusters and contractors and observed what was paid as storm damage by insurance companies. …DiRito has never worked for an insurance company and has never worked as an insurance adjuster. …She has never taken any certification class to identify hail damage, although one was offered to her. …She is not licensed as a public adjuster… She does not hold a contractor license.
DiRito created DiRito Roofing & Claims on July 30, 2018, as a tradename of MMBO…. DiRito Roofing & Claims was created specifically in response to the opportunity presented by the July 23, 2018 storm in Canon City. Neither MMBO nor DiRito Roofing & Claims have ever registered to do business in Colorado…. DiRito advertises herself as having provided ‘independent claim management for more than 4,000 claims,’ and having ‘negotiated and settled more than $25,000,000 in full claim settlements.’. . . DiRito Roofing & Claims does not do the roofing work itself, and instead hires subcontractors to perform any contracted roofing services… DiRito met Yale’s property manager, Jeff Mueller, in a restaurant on August 15, 2018, where Mueller asked DiRito to come take a look at his property….. DiRito inspected the property on September 25, 2018. …Yale signed a contract with DiRito dated October 12, 2018. …DiRito has never been an expert before.
The first argument was that DiRito should not be permitted to testify because she vilatred Colorado laws regulating businesses, roofers and public adjusters:
Colorado laws require that foreign entities register and file statement of authority with the Secretary of State before transacting business or conducting activities here. C.R.S. § 7-90-801 (prohibiting foreign entities from transacting business or conducting activities in this state unless it is registered with the state of Colorado). DiRito is transacting business and conducting activities in violation of this statute and without authority.
Further, DiRito’s work in this case and proffered testimony violates Colorado laws regulating the conduct of roofing contractors and public adjusters. Colorado prohibits a person from acting as a public adjuster unless he or she is licensed to do so….
At the same time, Colorado law mandates that ‘[a] roofing contractor soliciting roofing services in this state shall not claim to be or act as a public insurance adjuster adjusting claims for losses or damages,’ and the roofing contractor is limited to discussing with an insurer ‘the scope of repairs… when the roofing contractor has a valid contract with the property owner on which the roofing contractor has contracted to perform roofing work.’ Id. § 6-22-105 (3)3. Further, Colorado law imposes requirements on roofing contracts. The roofing statute requires roofing contractors to permit clients to cancel the contract if insurance claims are denied in part or in full, and ‘return to the property owner any payments or deposits made by or evidence of indebtedness of the property owner in connection with the contract for roofing work on the residential property,’ except to compensate the contractor for ‘roofing work actually performed’ on the property ‘in a workmanlike manner consistent with standard roofing industry practices.’
… DiRito’s contract violates the statute and shows that DiRito is not just acting as a roofing contractor; she is also providing claim services for which she expects to be compensated. She is engaging in public adjusting without a license and in violation of Colorado statute and regulations, on a claim for which she is also contracted to perform the roofing work.
. . . .
DiRito is not qualified to provide expert testimony on identifying hail and wind damage. While DiRito asserts that she has inspected thousands of roofs while helping clients with insurance claims, and this may help her learn what to say or do to get claims paid, she is not actually trained or educated on the identification of storm damage on roofing systems. DiRito has not taken any certification course about how to evaluate hail damage on asphalt shingle roofs…. DiRito’s report relies on cut and paste internet material regarding granule loss and damage that she does not attribute, instead passing off as her own. As discussed below, DiRito then modifies that content to insert unsupported hypotheses. DiRito’s experience does not provide the qualifications to conduct this type of analysis.
The court struck the expert’s ability to testify, and the Condominium Association lost its case. The sad part is that when I reviewed her report found in the court file, the pictures clearly depicted what I find true experts to classify as hail damage.
This case could have had a different outcome except for two reasons. First, the selected law firm allowed her to act as the expert. Second, the law firm did not retain other experts who could have been qualified to testify about:
- Meteorology of the hailstorms in the area.
- Hail and wind from the hailstorm causing the damage.
- Independent damages experts about the costs to fix those hailstorm damages.
The bottom line is that Associations should research and hire experienced experts when it comes to work performed on behalf of Association property and insurance claims. Do not trust Internet advertising and what people say. Check out if they are truly licensed and have been retained before.
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1 Yale Condominium Homeowner’s Association v. Americam Family Mut. Ins. Co., No. 1:19-cv-02477 (Dist. Colo. Nov. 1, 2021).