A government planning inspector has rejected proposals by a developer to build a £150 million district shopping centre next to Derriford Hospital, in Plymouth.
The multi-million pound battle was triggered in 2011 after Plymouth City Council's planning committee rejected a proposal by developer Wharfside Regeneration Ltd for land known as the North West Quadrant.
With millions of pounds at stake, Wharfside launched a lengthy and expensive planning appeal last September and October.
Now a government planning inspector has ruled in favour of the council. And Wharfside will have to pay some of the council's costs, thought to be in the region of £250,000.
Wharfside wanted to build a supermarket alongside 356 homes, shops and restaurants on its 16.5-acre site. The company has already begun building a car park next to the hospital.
Meanwhile, the council earmarked the nearby Seaton Barracks parade ground as its preferred site for a district shopping centre, to be anchored by a 7,000sq metre superstore.
Sutton Harbour Holdings also joined in the fray to promote its own masterplan for a new community, including shopping centre, on the former airport site, further north.
The issue became more complex this year when a different government inspector said he was minded to reject the council's blueprint for the north of Plymouth.
John Oxley, a director of Wharfside Regeneration Ltd, said: "We are studying the decision of the inspector."
Paul Barnard, Plymouth's chief planner, said: "The decision is a ringing endorsement of our detailed evidence to the inquiry. There is a lot of development interest in Derriford."
He said any decision to push ahead with a proposal for the Seaton Barracks site would be taken by the city as landowner.