Alternative Dispute Resolution in Construction: The Rise of AI, Expedited Arbitration, and Digital Platforms

The Digital Transformation of Construction Dispute Resolution

The construction industry is experiencing a fundamental shift in how disputes are resolved, driven by technological advancements and the urgent need for faster, more cost-effective solutions. Traditional construction disputes that once took years to resolve through litigation are now being addressed through innovative alternative dispute resolution (ADR) mechanisms that leverage artificial intelligence, expedited procedures, and digital platforms.

Construction disputes have historically been among the most complex and time-consuming legal matters, often involving massive volumes of technical documents, multiple parties, and intricate contractual relationships. However, the landscape is rapidly evolving as legal practitioners embrace technology-driven solutions that promise to revolutionize how construction lawyers handle dispute resolution. While these solutions are not appropriate for every dispute, they can help address time-sensitive issues without stalling out a construction project.

AI-Assisted Document Review: A Game Changer for Construction Arbitration

Artificial intelligence is transforming document review and production in construction arbitration, cutting both the time required to reach resolution and the costs involved. The sheer volume of documentation in construction disputes—including contracts, change orders, daily reports, correspondence, and technical drawings—has traditionally created bottlenecks that could extend proceedings for months or years.

AI-driven legal technology can help streamline discovery by automating certain parts of document review, including by identifying key correspondence and flagging critical issues. Large language models (LLMs) can be used to take a first pass through documents and sort them into different categories by topic, date, or other criteria. While these tools cannot replace lawyers (and aren’t as precise as them), they can reduce the overall time burden that lawyers have to spend filtering through thousands, if not millions, of pages of construction documentation. However, practitioners must remain vigilant about data security, AI bias, and the need for human oversight in critical decision-making processes.

Technical Expert Determination: Specialized Resolution for Complex Issues

Expert determination has emerged as particularly valuable for construction disputes involving technical issues where specialized knowledge is essential — such as determining whether a construction deficiency is a construction defect or a design defect, or determining whether a change order is valid. Unlike arbitration, where arbitrators act as judges, expert determination involves appointing independent professionals with relevant technical expertise to decide specific disputes based on their specialized knowledge.

Construction projects increasingly involve complex technical disputes that benefit from expert determination, including design defects, construction quality issues, delay analysis, and cost valuations. The process typically involves the expert receiving written submissions from each party, considering supporting documentation, and issuing a binding written determination.

The key advantage of expert determination in construction contexts is speed and technical (but perhaps not legal) accuracy. Expert determination is typically quicker and cheaper than arbitration or litigation, often providing resolution within months rather than years. The expert's deep technical knowledge allows for more informed decision-making on complex construction issues.

Expedited Arbitration: Fast-Track Solutions for Time-Critical Construction Claims

The construction industry's demand for faster dispute resolution has driven widespread adoption of expedited arbitration procedures. Traditional arbitration, while often faster than litigation, still often requires 18-24 months to reach final resolution—too long for construction projects with tight schedules and cash flow pressures.

If project-critical disputes arise in the middle of construction, parties often prefer to have their disputes settled within weeks or months, not years. Some construction industry participants are now drafting specific expedited arbitration clauses, limited to time-sensitive issues that can arise mid-construction. And both AAA and JAMS have developed comprehensive expedited arbitration procedures for construction claims.

Recent trends show expedited arbitration gaining particular traction in renewable energy projects, where technical issues can halt progress and cause significant financial strain. The ability to resolve disputes quickly while maintaining project momentum has made expedited procedures increasingly attractive for owners, contractors, and lenders involved in complex construction projects.

Online Dispute Resolution Platforms: The Future of Virtual Construction ADR?

The COVID-19 pandemic accelerated adoption of online dispute resolution (ODR) platforms, which have now become standard practice rather than emergency measures. Virtual hearings, electronic document management, and digital case management systems have proven their effectiveness in handling complex construction disputes.

Leading ADR providers like JAMS and AAA now offer comprehensive virtual services including online case management platforms, secure document sharing, and hybrid hearing capabilities. JAMS Virtual Moderators provide technical support throughout the process, from pre-hearing test runs to after-hours assistance, ensuring seamless virtual proceedings.

International arbitration institutions have also embraced online construction dispute hearings, with significant developments in the UK, UAE, China, and other major construction markets. The LCIA's revised arbitration rules specifically empower tribunals to employ technology to enhance efficiency, while Chinese institutions like CIETAC have established specialized Online Dispute Resolution Centers.

The advantages of ODR for construction disputes extend beyond pandemic necessities. Virtual proceedings significantly reduce travel expenses and time for multi-jurisdictional construction projects, enable real-time document sharing and collaborative review, and provide recorded proceedings for improved accuracy. For international construction projects, ODR platforms eliminate the logistical challenges of coordinating hearings across multiple time zones and jurisdictions.

Integration and Future Implications for Construction Law Practice

The convergence of these technological and procedural innovations is creating new opportunities for construction lawyers to provide more efficient and effective representation. AI-assisted document review enables faster case preparation, expert determination provides technical accuracy for complex issues, expedited arbitration delivers timely resolution, and ODR platforms reduce logistical barriers and costs.

However, these developments also present new challenges for construction law practitioners. Lawyers must develop competency in AI tools while maintaining professional responsibility standards, understand the limitations and appropriate applications of expert determination, master expedited procedure requirements, and ensure cybersecurity and confidentiality in virtual proceedings.

Looking forward, construction lawyers who embrace technological and procedural innovations will be better positioned to serve clients effectively in an increasingly complex and fast-paced industry. The combination of AI efficiency, technical expertise, expedited procedures, and virtual accessibility is reshaping construction dispute resolution from a time-consuming last resort to a strategic business tool that supports project success rather than merely resolving project failures.

As these trends continue evolving, construction lawyers must balance technological adoption with traditional legal practice, ensuring that innovations enhance rather than compromise the quality and integrity of dispute resolution services. The future of construction law lies in the thoughtful integration of these advanced tools and procedures to deliver faster, more accurate, and more cost-effective solutions for the complex disputes that inevitably arise in major construction projects.