Construction Leaders Podcast: "Avoiding Disputes and Driving Results with Better Contracts"

Date: October 1, 2025
Host: Construction Management Association of America
Guests: Nick Soto (Host), Carly Trout (Co-Host), Shannon McElveen (Chief Operating Officer, AIA Contract Documents)

Episode Overview

This episode delves into the vital role standardized contracts play in construction project success. Shannon McElveen, COO of AIA Contract Documents (ACD), joins hosts Nick Soto and Carly Trout to explore how clear, collaborative contract language can prevent disputes, enhance efficiency, clarify communication, and support evolving industry needs like sustainability and technology integration. The episode is packed with insights for owners, contractors, and designers, offering practical advice on leveraging contracts to drive better outcomes.

Guest Introduction and the Role of Contracts

Shannon McElveen's Background and Perspective

• Shannon’s Experience: 20+ years in construction finance and management roles, including controller/CFO for major contractors and work at Coca Cola and Fujifilms. (01:31)

  • “In my mind, understanding the contract helps you understand the rules of engagement, the requirements of the owner, and those key milestone and communication process that set up a project for successful completion.” – Shannon McElveen (02:04)

• Current Role at AIA Contract Documents:

  • Oversees Content Team (six attorneys) and Education Department (03:25)
  • Ensures contracts are updated for current case law and industry changes; educates the industry on usage and risk mitigation

• Contract Update Cycle:

  • Standard: 10-year update process, allowing case law and project feedback to inform revisions (04:15)
  • Exception for fast-changing areas (e.g., BIM/design-build): Accelerated updates as industry evolves (08:05)

Key Discussion Points & Insights

1. Why Standardized Contracts Matter (04:15)

• Contracts as Rules of Engagement:
  • Define responsibilities, timelines, and communication processes on a project
  • Outlines procedures for changes, approvals, compensation, and risk management
• Living Documents:
  • Revised in response to legal cases and real-world project outcomes
  • Accompanied by guides offering modification suggestions for project-specific needs

2. Adapting to Industry Change (07:35)

• Standard 10-year revision adapts if industry needs change more quickly
  • Example: Rapid releases for BIM and design-build to keep pace with tech evolution

“If there’s things going on in the industry that are changing, you’re going to see us adapt and release content at a much faster pace.” – Shannon McElveen (08:05)

3. Efficiency through Contract Clarity (08:46)

• Prevents Costly Mistakes: Clear processes for change orders ensure all parties are compensated and avoid rework
• Process Example: Owner requests change, contract specifies required approvals and documentation for payment

"That in itself, understanding those rules of engagement creates a lot of efficiency." – Shannon McElveen (11:15)

• Flow of Payment and Work: Contracts stipulate how payment applications, billing types (cost-plus, GMP, stipulated sum), and paperwork are handled

4. Fostering Collaboration (13:09)

• Contract as Collaboration Blueprint:
  • C132 and A133 forms define construction manager’s collaboration with owner and architect from pre-construction through design review
  • Ensure all parties are aligned on schedule, budget, and constructibility

“If you do that up front, the way those two parties work together and collaborate together are in line with that contract.” – Shannon McElveen (13:25)

5. Real-World Example: The Cost of Skipping Protocol (15:05)

• Case Study: Subcontractor bypasses change order process, installs work, and isn’t fully compensated
  • Result: Required rework, project delays, and frustration among all parties

6. Proactive Dispute Resolution (16:32)

• Disputes Are Inevitable: Even collaborative teams encounter them
• Contractual Process:
  • A201 requires disputes go first to an “initial decision maker” → mediation → litigation/arbitration if needed (17:00)
  • Contractors must continue performing; owners must continue paying while disputes are pending

“The contract says you have to stay there and you have to continue to work... the owner has to continue to pay while things progress. You don’t want a project to stop just because there’s a dispute.” – Shannon McElveen (17:54)

• Controlling the Tempo: Parties can decide whether to resolve individual claims quickly or aggregate for mediation/arbitration

7. Integrating Sustainability & Technology (20:02)

• Adapting for Sustainable Projects:
  • Contracts (A133, C132) include sections to specify sustainable objectives
  • Require “sustainable project exhibits” to define and assign responsibilities for green goals
  • Coordinated language ensures all parties know their role and expectations in meeting sustainability targets

“It’s critical to understand and to ensure that people can remain efficient while doing their part of that project execution, knowing what’s expected of them up front, how to measure success, and how do they report out on it.” – Shannon McElveen (21:41)

8. One Piece of Advice for Contract Success (22:56)

• Don’t Just Rely on Old Forms:
  • Regularly review contracts for updates and relevance to current law and practice
  • Leverage AIA templates, but always review with your general counsel to account for project-specific nuances

“Using the same contract over and over again is not the right answer...take that time up front to make sure you have the best contract for that project and that relationship is worth the investment.” – Shannon McElveen (23:08)

Notable Quotes & Memorable Moments

• On Contract Updates:
  “We want to make sure that the content that we deliver is actually meeting the individual needs in the organization.” – Shannon McElveen (04:01)

• On Change Orders:
  “The last thing you want to happen is that the subcontractor doesn’t get paid or the construction manager doesn’t get paid because they didn’t go through the right process.” – Shannon McElveen (10:49)

• On Collaboration:
  “You don’t want something designed later on down the road [and] you just can’t build it.” – Shannon McElveen (13:37)

• On Staying Efficient During Disputes:
  “If you don’t read the contract, you don’t know those steps. And if you don’t understand those steps, then you’re slowing that project down.” – Shannon McElveen (18:39)

Key Timestamps

| Segment | Time | Brief Description | |-----------------------------------------|--------|----------------------------------------------------------------------------| | Intro & Guest Background | 00:03 | Podcast theme and Shannon McElveen’s introduction | | AIA Contract Document Process | 03:25 | Role of content team, update cycle, liaison involvement | | 10-year Update Cycle & Adaptability | 07:35 | Update process, speed for tech/sustainability | | Contracts & Project Efficiency | 08:46 | How contract clarity prevents delays and disputes | | Collaboration via Contract | 13:09 | Defining collaborative roles in contract docs | | Real-World Case Study | 15:05 | When skipping protocols leads to costly mistakes | | Dispute Resolution Clauses | 16:32 | Stepwise dispute handling, work continuity obligation | | Sustainability & Technology Clauses | 20:02 | Integrating green goals and tech into contracts | | Shannon’s Key Advice | 22:56 | Refresh and tailor contracts—never just reuse |

Final Takeaways

• Contracts are foundational to project efficiency, clarity, and dispute prevention.
• Standardized templates are powerful but always require thoughtful, project-specific review and updates.
• Contract language can advance newer project needs, including collaboration, sustainability, and tech integration.
• Investing in upfront contract diligence pays dividends in avoiding disputes and driving project success.

For more resources, visit AIA Contract Documents or check out CMAA’s contract administration guidelines at cmaanet.org.