In Practice

The Face-to-Face Mediation Program: A Massachusetts Success Story

Suzanne Goulet Orenstein and Kathleen Grant

Predictions from national consumer experts to the contrary, a Massachusetts program offering face-to-face mediation for consumer disputes has become an increasingly viable alternative to small claims court hearings. The program in the office of Massachusetts Attorney General James M. Shannon has also proven to be an important catalyst for nonlegal dispute resolution methods in other consumer and civil litigation work, both in the Department and in other state agencies.

However, when the "Face-to-Face Mediation Program" was ftrst proposed in 1984, national consumer agencies were not at all encouraging about adding the approach to the Attorney General's existing consumer protection services. The White House Office of Consumer Affairs suggested that the dollar amounts involved in small claims might not be sufficient to justify the time to be put into the cases by consumers and businesses. The National Association of Consumer Agency Administrators was dubious about businesses' willingness to participate in such a voluntary process. No other model for such an application of consumer dispute resolution could be found anywhere in the country.

A study of the program's first two years disproves these reservations. The report prepared by project staff focuses on the eight local community mediation programs inaugurated in cities and towns throughout the state between January 1984 and the end of 1986. The National Institute for Dispute Resolution (NIDR) provided the initial funding for two face-to-face mediation services to operate as adjuncts to existing local consumer advocacy programs. Then, as state funds were appropriated, the other programs were added.

A well-developed local consumer advocacy system offered a strong existing base on which to develop the new service. The 28 grantee agencies in the existing program already provided telephone information and consumer advocacy on the

Suzanne Goulet Orenstein, who is Senior Associate, Program on Environmental Dispute Resolu­tion with The Conservation Foundation, Washington, D.C., formerly was Chief, Local Consumer Groups and Dispute Resolution Activities with the Office of the Massachusetts Attorney General. Kathleen Grant is Coordinator of the Face-to·Face Mediation Program, Public Protection Bureau, The Massachusetts Attorney General's Office, 131 Tremont St., Boston, Mass. 02111.

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local level. Two-thirds of the individual consumer complaints filed with the Attorney General's office were handled in these offices. Consumer advocates in local town halls, legal service offices, anti-poverty programs, and private, non­profit consumer protection programs assisted thousands of consumers each year. They regularly resolved up to 70 percent of the complaints they handled.

For the complaints that were not resolved, the small claims court was the next step. However, a 1983 survey of those cases indicated that over half (54 percent) of the consumers referred to small claims court did not actually file a claim. These consumers said they were frustrated by the responses to their grievances and by the options available to them.

Given the proven value of community mediation programs in resolving minor criminal and family disputes elsewhere, face-to-face consumer mediation was proposed as a more convenient and timely mechanism for dealing with these unresolved consumer cases.

The authors coordinated the Face-to-Face Mediation Program from within the Attorney General's Office. They prepared a report detailing how the experi­mental approach grew into a stable system of eight local programs--the first state-run community mediation system in Massachusetts--and highlighting the impact of the system on the institutionalization and use of mediation in other state contexts. Their report also included a survey of the mediation clit:nts conducted by the Attorney General's office.

Local Program Experience All eight programs were created as adjuncts to existing consumer advocacy programs that would be the source of the cases to be mediated, as well as a source of consumer rights information for the clients who would be participating in the process. Each program had a full-time director and a pool of volunteer mediators.

The use of volunteers was considered to be critical to creating a credible and fair pool of mediators; if the mediators came from the consumer protection staff, they might well be viewed as consumer-biased. Over 200 mediators were trained at the local sites by members of the Attorney General's Face-to-Face Mediation Program staff.

The mediation sessions were scheduled for evenings and Saturdays for the convenience of the clients, as well as of those mediator-volunteers who were employed.

The cases most frequently mediated include home improvement complaints, implied warranty claims, landlord-tenant disagreements, car repair disputes, and merchandise credit and return issues. In general, the face-to-face mediation programs seemed to have the most impact in cases in which:

• the parties disagreed about the facts of the conflict (and thus were unable to resolve the complaint through negotiation by a consumer advocate);

• the business was willing to resolve a complaint but was unwilling to provide the exact remedy sought by the consumer; or,

• the law was unclear or not applicable to a particular problem.

The types of sponsoring agencies differed from location to location. Some of the face-to-face programs became part of city-run consumer protection pro­grams; others were implemented in community action anti-poverty programs.

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One was located in a legal services office; others were housed in free-standing consumer advocacy projects.

Referrals the Key Referrals proved to be the most troubling aspect of the program. For every five referrals, there was only one actual mediation. In the other four cases, one of the parties-primarily the business in question-refused to attend a session. Seventy percent of the businesses referred to mediation declined to take part.

To pinpoint the reasons for limited participation, especially on the part of businesses, the Attorney General's staff conducted a survey of those who used mediation and of those who refused it in late 1985 and early 1986. Among the significant findings of the survey:

• Consumers reported more reasons than businesses for agreeing to mediate; consumers saw a lack of other alternatives and were more emotionally involved in pursuing the case, while businesses perceived fewer reasons for participating.

• Both consumers and businesses reported that they found the mediation pro­cess fair and unbiased and said they did not feel at a disadvantage in negotiations.

• Businesses that did participate were more satisfied with the results than the consumers were.

• Landlord-tenant cases, which involved past and continuing relationships, were more frequently settled through mediation than were consumer-merchant cases which often involved zero-sum dollar amount negotiations.

• While lower than that in other community dispute resolution programs, the 75 percent agreement rate in consumer mediations does warrant continued use of this process. Participants apparently follow through on their commitments-95 percent of the agreements reached are upheld.

To stimulate broader use of their services over the two years, some of the programs began soliciting referrals from small claims courts and offering media­tion to those who were awaiting trial there. Additional cases served to make the program more visible and valuable to the communities and to the court system. As visibility increased, referrals began coming in from other community agencies, district attorneys, and shelters. The growing "word of mouth" network even produced a client who had heard of the program from a cab driver! Caseloads for the volunteer mediators continued to build as time brought increasing awareness of the program.

Influence on Other Institutions The Face-to-Face Mediation Program has had a wide impact on the broader public protection work both within the Department of the Attorney General and in other agencies. A valuable side benefit of the local program has been the growing recognition of the usefulness of the mediation process by assistant attorneys general and other state agencies. Mediation has been sought as an alternative or supplement to litigation in class action consumer, civil rights and environ­mental lawsuits.

For example, damages in a home construction case were mediated after liability was determined by the court; a suit alleging the "bad faith" closing of a mobile home park was averted when a mediator helped the tenants to purchase

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the park; several environmental and civil rights cases have been referred out to private mediators. In addition, mediation and arbitration have been written into consent judgments as an ongoing dispute resolution mechanism. In a very large case against five automobile dealers, an individualized set of arbitration rules was developed to include in a consent judgment.

Other state agencies with a consumer-oriented mandate have sought and taken part in training in face-to-face mediation provided by the Attorney General's staff. Sessions have been held, for example, for housing advocates and mediators, for conciliators from the state's Industrial Accident Board, and for nursing home ombudsmen.

Department staff involved in the program have become a strong voice in the community mediation field, particularly in training and standards. Face-to-face project staff represented the Attorney General on the Governor's Working Group on Alternative Dispute Resolution (ADR) and on the committee established by the Chief Justice of the Trial Court to implement the ADR Working Group's recommendations. Staff served on a national commission that considered a revision of standards for the operation of arbitration mechanisms by businesses as a way of resolving automobile "lemon law" and other consumer cases.

Local program staff are active on the executive committee of the Massachu­setts Association of Community Mediation Programs. The Massachusetts Media­tion Service, one of four state offices of mediation in the country funded by the National Institute for Dispute Resolution, designed its program to include a close working relationship with the Attorney General's office.

In all of these instances, the Attorney General's endorsement of mediation and ADR was a factor in encouraging the use and growth of mediation in other institutions.

Summary An effort that began as an experimental alternative to small claims court for consumer cases has fostered the application of alternative dispute resolution to many other conflicts in Massachusetts. The Attorney General's Face-to-Face Medi­ation Program, unique in the country, has proven to be an effective local resource to citizens of the state for resolving consumer disputes. The influence of the program has been felt outside the Attorney General's office as well as within.

In the two years since this report was written, the Attorney General's Face-to-Face Mediation Program has shown a steady increase both in referrals and in quality of service. Today, all but one of the seven remaining mediation programs is running at or near capacity. In 1988,84 percent of the approximately 700 cases that were mediated reached agreement, and 96 percent of those agreements were upheld.

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