Michael Lyndon-Stanford, who owns the Grade I-listed Wingfield Castle in East Anglia, accused Mid Suffolk District Council of failing in its conservation duties over the approval of the residential conversion.
Now, a High Court judge has ruled that the local authority's decision was based on "misleading" reports from its heritage team, related to Lyndon-Stanford’s attempts to buy the Grade II-listed Castle Farm Barns.
Deputy judge John Howell QC said that the moated castle dates back to around 1385, and was partially demolished after it was seized by Henry VIII in the 16th Century. One original wall remains, and the castle was repaired and rebuilt in around 1544.
The judge added that the adjacent barns are buildings of "special architectural and historic interest", and said that they have a "close visual relationship" with the castle.
However, they were sold into separate ownership as part of a farm during the 20th century.
Lyndon-Stanford claimed that in 2006 he tried to buy the barns in order to preserve them.
But he said the owners, Duncan and Peter West, withdrew from negotiations.
In 2015 though, the Wests and Warren Hill Farms made their application for planning permission and listed building consent to convert the barns into three homes.
Heritage watchdog Historic England and Lyndon-Stanford objected to the plan but the council’s development control committee overrode their objections and approved the project, granting listed building consent in March and planning permission in April.
Lyndon-Stanford attacked the way the council addressed the impact of the proposed redevelopment on the setting of Wingfield Castle, and its consideration of whether there was an alternative means of securing their future.
He argued that the development would "harm the setting" of his castle.
Quashing the decision, the judge said that the reports on which the decision was made were "misleading" because they wrongly gave the impression that Lyndon-Stanford had been offered multiple opportunities to buy the barns but had failed to do so.
The council, which will now have to reconsider the application, had argued that the decision would have been the same even if the correct information had been given.
R on the Application of Lyndon-Stanford v Mid Suffolk District Council. Case Number: CO/2439/2016