Developers who applied for planning permission for massive housing projects in the South Staffordshire area have lost a High Court challenge to overturn the way the Government decides on appeals.

The decision is a big boost to residents who have campaigned against the expansion of Cheslyn Hay, Featherstone and Fradley.

The Secretary of State for Communities and Local Government, Hazel Blears, is considering appeals against South Staffordshire District Council’s decision to deny permission for the developments in the three villages following hearings last summer.

But the developers called on Mr Justice Jeremy Sullivan to stop Miss Blears using new research, which has not yet been officially recognised by central government.

It requires councils to insist developments take place on derelict industrial land first before tearing up swathes of greenbelt.

One of the country’s top planning judges, Mr Justice Jeremy Sullivan dismissed the challenge. He backed the Secretary of State’s decision to use the more up to date figures. The developers now have two weeks to decide whether to launch a further bid in the Court of Appeal.

Land owner Dr Nigel Roberts, Wolverhampton-based Persimmon Homes and the Curborough Consortium, claimed they were given a “legitimate expectation” that, until a new housing policy comes into effect, housing provision for the South Staffordshire area would be assessed on the basis of a scheme which was used since the 1960s.

They claimed the Government had gone back on that, making planning applications for large housing developments in South Staffordshire more difficult.

Dr Roberts applied for 560 homes on land he wants to sell in Campions Wood, Cheslyn Hay, while Persimmon wanted 360 homes in Featherstone and the Consortium asked to build 1,400 homes at the Curborough site in Fradley.

Leader of the district council, Councillor Brian Edwards, said: “If these appeals had all been granted it would have used up our entire planning allocation for the next 15 to 20 years.”

Decisions on the appeals are expected during April.