Construction Leaders Podcast: "Evolving Disputes, Smarter Solutions: How Construction Leaders Can Stay Ahead"

Date: November 1, 2025
Host: Construction Management Association of America
Guests: Brian Van Lenten (Director, Claims, Arcadis), Steve Warhol (Senior Director, Claims, Arcadis)
Summary by Section

Episode Overview

This episode of the Construction Leaders Podcast examines the shifting landscape of construction disputes in North America, drawing from Arcadis' 15th Annual Construction Disputes Report, titled Construction Disputes in Motion: Speed, Agility, and Adapting to Change. Carly Troup and Nick Soto discuss with Brian Van Lenten and Steve Warhol the causes, values, and resolution times of disputes, as well as broader industry challenges including labor shortages, rising costs, and the impact of technology adoption (like AI and BIM) on dispute prevention and resolution.

Guest Introductions (02:07–03:42)

• Brian Van Lenten:

  • Background: Structural engineer, transitioned into construction claims resolution 12 years ago.
  • Focus: Delay, productivity claims, testifying expert, educator on claims avoidance.
  • "I've taught claims avoidance seminars to departments of transportation across the U.S." [02:07]

• Steve Warhol:

  • Nearly 40 years in the industry, from scheduler to program manager to claims/resolution.
  • Testified as expert in disputes ranging from small condos to multi-billion dollar plants.
  • Professorship: University of Washington, teaching claims and dispute resolution.
  • "I've worked my way up...from scheduler to program manager of a $4 billion program." [02:50]

What is the Construction Disputes Report? (04:04–05:32)

• Annual, 15th edition; covers trends for 2024–2025.
• Measures: Dispute values, durations, causes, and avoidance techniques.
• Data from wide survey of owners, contractors, engineers, and CMs.
• Provides industry benchmarks and highlights trends like workforce shortages and tech adoption.
• "Ultimately, the report serves as both a snapshot...as well as a guide for owners, contractors, and legal practitioners on dispute avoidance and resolution strategies." [04:55] – Brian Van Lenten

Key Trends in Construction Disputes (05:32–09:43)

• Dispute Values and Duration:

  • 2024 average dispute value: $60M (up 40% from $43M in 2023; triple that of 2019).
  • Average resolution time: 12.5 months (down 14%—shortest in a decade).
  • Larger, more complex disputes, but being resolved faster.
  • Increasing use of alternatives like mediation and data-driven analysis.
  • "Disputes [are] becoming larger and more financially complex, yet they're being resolved faster." [06:49] – Steve Warhol
  • Memorable anecdote: $3B project, grew to $6B, arbitration took nearly five years. [07:28]

• Why Faster Resolutions?

  • Post-COVID backlog: need to resolve and move on.
  • Labor shortages: urgency to finish projects, leading to expedited dispute resolution.
  • Growing popularity of alternative dispute resolution tools.

Labor Shortages & Economic Impacts (09:43–11:36)

• Skilled Labor Shortages: Affecting project delivery, timelines, and costs.
  • "Owners and project managers are reporting that the shortage of skilled labor is having an effect on their projects and causing delay." [09:43] – Brian Van Lenten
  • Contractors are paying premium rates; basic economics (supply & demand).
• Costs Expected to Rise:
  • "Those people that they do find are asking for premium rates for the labor...So it's cost is going up and schedules are being delayed." [10:28] – Steve Warhol

Top Causes of Construction Disputes (11:36–13:57)

• For third consecutive year:
  1. Errors and omissions in contract documents.
  2. Failure to understand or comply with contract obligations.
  3. Owner-directed changes.
• Persistent issues: Unclear documentation, misaligned expectations, inadequate compliance, and communication failures.
• "Contract clarity and stakeholder education remain really central to avoiding disputes." [12:56] – Brian Van Lenten
• Owner changes can severely disrupt schedule and budget.

Addressing Contract Ambiguity (13:57–16:27)

• Contract Ambiguity: One of the most frequent causes of disputes.
  • Parties not reading/understanding contracts thoroughly.
  • Custom contracts are challenging—often written by those unfamiliar with construction, creating gaps and misinterpretations.
  • "The owner might read the same paragraph one way and the contractor reads it another way, obviously probably to their advantage." [15:15] – Steve Warhol
• Practical Steps:
  • Thorough pre-construction contract reviews (“constructability reviews”).
  • Risk assessments, especially vital for smaller projects that often skip these steps.
  • "Project owners do not do enough in performing risk assessments of their own projects and understanding where the weaknesses are before they even hire the contractor." [16:14] – Steve Warhol

Technology Adoption in Construction (17:40–22:23)

• Adoption is Accelerating (but still uneven):

  • Drones: Widely used for progress tracking and delay verification.
  • BIM: Effective in catching design clashes early.
  • AI: Growing role in predictive scheduling, risk assessment, and real-time monitoring.
  • IoT: Used to gather detailed equipment and labor usage data.

• Benefits:

  • Dispute support with evidence-based data, improved risk/claim prediction.
  • More accurate productivity and delay measurement.
  • "With something like a drone, I think it's fairly obvious what the benefits are. ...You can track progress on the project." [18:12] – Brian Van Lenten

• Challenges:

  • Smaller firms face upskilling and integration barriers.
  • Some tech capabilities are overpromised/not yet realized at scale.

• Real-world Example: (Steve Warhol)

  • On a $6B refinery project, AI and data mining help process 50 months of updates, each with 35,000–40,000 activities.
  • "Construction managers would rather be out watching the project in real time instead of trying to spend hours...trying to figure out where one activity started going askew." [23:09] – Steve Warhol

• On AI and Human Expertise:

  • AI won't replace construction managers because construction "is built by humans...you have to have people who are watching and managing and have a human understanding. It's rarely ever black and white..." [23:55] – Steve Warhol

Broader Market Challenges (24:18–25:47)

• External Pressures:

  • Geopolitical uncertainty, tariffs, wars disrupts supply chains and impact costs (especially for lumber and steel).
  • "The concern is also escalation of costs. So if we shut down the borders...on lumber, the price of housing is going to go up..." [24:56] – Steve Warhol

• Strategies for 2026:

  • Limited solutions—some issues rely on political decisions.
  • Emphasis on flexibility, risk awareness, and adaptive management.

The Future: Technology, Collaboration, and Leadership (25:47–30:28)

• Will Disputes Ever Disappear?

  • Highly unlikely—too much inherent uncertainty in construction.
  • "I don't know that we're going to be in a position to get rid of construction disputes, at least not in the foreseeable future. ...there's always going to be, first of all, unknowns that you encounter." [26:03] – Brian Van Lenten

• Best Hopes:

  • Use tech to record granular data, enabling quicker dispute resolution.
  • Efficiency is increasing: disputes are larger but resolved faster.
  • AI will help identify key data and responsible parties, but cannot prevent all issues.

• Best Practices for Prevention:

  • Early involvement of consultants to conduct risk assessments and constructability reviews.
  • Ongoing stakeholder education and training.
  • Frequent, open communication to maintain trust and resolve tension early.
  • "You can avoid all those tensions and miscommunications if you keep in touch with each other and resolve things professionally." [29:22] – Steve Warhol
  • Proactive claim/issue mitigation—negotiate and address items early.

Notable Quotes & Memorable Moments

• On Growing Dispute Values:
  "In 2024, the average dispute value jumped about 40% from about $43 million in 2023 to over $60 million." – Steve Warhol [06:18]

• On Speedier Dispute Resolution:
  "The average resolution time dropped by about 14% to just 12 and a half months, which is the shortest we've seen in a decade." – Steve Warhol [06:32]

• On Persistent Contract Issues:
  "The leading cause of disputes, for in fact the third year in a row, is errors and omissions in contract documents." – Brian Van Lenten [12:07]

• On Impact of Labor Shortages:
  "Those people that they do find are asking for a premium rates for the labor. So it's a supply and demand issue right now." – Steve Warhol [10:31]

• On Technology Adoption:
  "AI won’t replace construction management people...you can’t replace workers with machines on building a building." – Steve Warhol [23:55]

• On Importance of Communication:
  "Failure to communicate...is a huge part of not just resolving claims, but avoiding claims in the first place." – Brian Van Lenten [12:41]

Timestamps for Key Segments

• [02:07] – Brian Van Lenten: Background and claims expertise
• [02:50] – Steve Warhol: Experience and academic role
• [04:04–05:32] – Construction Disputes Report overview
• [05:32–09:43] – Dispute trends: rising values, faster resolutions, post-COVID effects
• [09:43–11:36] – Labor shortage impacts
• [11:36–13:57] – Top 3 causes of disputes
• [13:57–16:27] – Addressing contract ambiguity and recommendations
• [17:40–22:23] – Technology’s role and challenges
• [24:18–25:47] – Market and supply chain challenges
• [25:47–30:28] – Future outlook, leadership, and best practices

Final Takeaways

• Construction disputes are increasing in scale but taking less time to resolve, due to improved efficiency and alternative dispute mechanisms.
• Labor shortages and supply chain uncertainties are major sources of pressure and risk.
• Persistent contract clarity issues fuel most disputes; proactive reviews and stakeholder education are essential.
• Technology (AI, BIM, drones, IoT) is gradually improving project data quality and dispute resolution, but can't replace the human element.
• Proactive communication, collaboration, and early intervention remain the most effective dispute prevention methods.

Read the full Arcadis report at arcadis.com > Expertise > Contract Solutions.

End of Summary