First there was to be the John F. Kennedy Library, a monumental shrine drawing bus after bus of the nostalgic. Community opposition convinced the trustees it might be better to install the museum on Boston's Columbia Point.

Next, there were plans for 120,000 square feet of retail space, along with a hotel, office and housing complex. Community opponents yelled about traffic and pollution, so the retail section of the complex was trimmed to under 100,000 square feet.

But the neighbors kept on screaming- and filing lawsuits as well. Last week, they won most of their demands in a settlement that may finally end the half-decade battle and allow the development of Parcel 1B, a 4.2 acre lot off Mt. Auburn St.

The developers agreed to the compromise under a variety of pressures-the two lawsuits threatened to drag on 40 years, tying up their capital and costing them hundreds of thousands of dollars. And an unhappy community meant the prospect of new legal obstacles at every turn.

The neighbors won a drastic reduction-to a maximum of 40,000 square feet-in the amount of retail space in the complex. Worried that the store and shops would attract the most cars, community opponents were willing to allow increases in the amount of housing and office space to offset the retail reductions.

In return, they promised to drop their lawsuits and not start any new ones-a blanket pledge not to cause trouble as the developers stick to their guidelines for the complex.

The most interesting part of the story, though, is the form of the agreement. Signed outside of court, and without the intervention of local government, the agreement is a unique attempt at independent settlement of community problems.

"People who hadn't talked with each other for years were sitting around the bargaining table in quite friendly discussions," John Pitkin, one of the community negotiators, says.

"Once we got momentum going, it all went very quickly," Pitkin says.

There are still possible snags. Perhaps the company's architects will not be able to draw up plans conforming to the new use guidelines-"they obviously think they can do it, though," Pitkin says. The Planning Board might turn thumbs down on the new plans-but they seemed happy with news of the compromise at an informal meeting last week. Or, it might turn out after all these years that two feet under Parcel 1B there is a gigantic marsh ready to swallow any development.

More likely, however, a firm foundation has been laid, and some day not too far away, Parcel 1B will be transformed from a controversial muddy field into a concrete mall. And if its neighbors keep their word, no one will be protesting this time.