7 tech trends could reduce construction liquidated damages disputes

Resolution Management Consultants says new project technologies could shrink commercial construction disputes tied to liquidated damages by catching problems earlier, improving coordination and speeding completion checks. The company points to BIM, AI, drones, blockchain and cheaper tools as forces that may make delays and claims less common.

Why it matters: - Liquidated damages clauses are in nearly every commercial construction contract, and disputes over them can delay project closeout for years. - Better project controls could reduce delays, limit claims and improve profitability across commercial construction. - The dispute risk matters because liquidated damages must compensate for loss, not punish a contractor.

What happened: - James Gallagher, P.E., F.ASCE, CEO of Resolution Management Consultants, outlined 8 technology and management shifts he says could reduce disputes over liquidated damages. - Gallagher said the construction industry is moving toward tools that identify issues earlier, improve coordination and clarify responsibility before claims escalate. - Resolution Management Consultants is based in Marlton, New Jersey, and works on both project planning and dispute resolution.

The details: - Building Information Modeling has expanded in depth, speed and reach, allowing real-time monitoring and communication across more project functions. - Earlier issue detection through collaborative technology can reduce delays before they become claim-worthy problems. - Artificial intelligence can recalibrate project activities in real time, including change orders and their impact on completion. - AI can flag work that falls short earlier in the process, triggering fixes before delays and damages grow. - New technology can bring subcontractor and third-party work into real-time scheduling and management. - Drones and other inspection tools can make inspections faster, cheaper and more effective. - Earlier inspections can help management correct problems before they become major errors or delays. - Blockchain can make change management more accurate and efficient by increasing trust among parties. - More efficient supply chains may reduce shipping delays as more materials are sourced in North America. - Technology is becoming more affordable and easier to implement even as disputes and litigation become more expensive. - New tools can confirm whether work is complete and ready for payment, which can reduce gray areas that often spark disputes. - BIM combined with AI can help determine whether payment should be authorized or whether shortcomings still exist. - Resolution Management Consultants was founded in 1993 by veterans in construction, contracting and engineering. - The firm says it has helped private owners, public agencies and contractors meet project goals or resolve time and cost disputes. - The company lists its website as the company announcement.

Between the lines: - The argument is less about any single tool and more about a shift from reactive dispute handling to early detection and continuous coordination. - If projects can document progress more clearly and resolve issues sooner, liquidated damages claims may become harder to sustain. - Gallagher's view implies that many disputes stem from uncertainty, not just delay.

What's next: - Gallagher expects technology to keep reducing the number of delay-related disputes, even if construction claims never disappear entirely. - Greater use of AI, BIM and other monitoring tools could make completion verification faster and more defensible. - More efficient workflows may push commercial construction toward fewer disputes and faster payment decisions.

The bottom line: - Liquidated damages disputes may not vanish, but better technology could make them less frequent, less expensive and easier to resolve.