East Bergholt Parish Council went to court after Babergh District Council granted three separate planning permissions for residential development in its area at a single council meeting in August 2017.
Babergh accepted that none of the projects accorded with the local development plan, but concluded that it only had a sufficient supply of deliverable housing sites to last about three years.
That was below the five-year target set by the National Planning Policy Framework (NPPF), so Babergh decided that the presumption in favour of sustainable development applied and that the planning permissions were therefore justified.
Challenging the decisions, East Bergholt argued that Babergh's understanding of the NPPF was flawed. It was alleged to have treated as deliverable only those sites where future housing development was "certain" or even "absolutely certain."
East Bergholt's challenge to the planning permissions was dismissed by the High Court, but it renewed the challenge in the Court of Appeal.
Ruling on the case, Lord Justice Lindblom said: "Put simply, the degree of confidence required in the 'deliverability' of sites is for the decision-maker to decide, within the bounds of reasonable planning judgment."
Babergh enjoyed considerable "latitude" when assessing whether there was "a reasonable prospect" of various sites being developed and whether such developments would be "achievable".
He noted that the question of whether a site is deliverable depends not only on achievability, but also on availability, suitability and viability, all of which ultimately depend on an exercise of planning judgment.
Babergh had made no reference to "certainty" or "absolute certainty" as a proxy for the concept of "realistic prospect", added the judge, who was sitting with Lords Justice Underhill and Irwin.
Babergh may, or may not, have taken a "more circumspect" view of deliverability than some other local authorities, but there was no indication that it misunderstood or misapplied the NPPF.
East Bergholt also argued that Babergh effectively caved in to "developer pressure" and was inappropriately influenced by fear that, if it refused to grant the permissions, it was likely to face the prospect of expensive appeals by developers.
Rejecting those claims, however, Lord Justice Lindblom said it was "not unlawful for a local planning authority to want to have confidence that it will be able to robustly defend the judgments it forms on the deliverability of housing sites."
He added: "The reality here is that the district council made its decisions to grant planning permission lawfully, with a true understanding of relevant policy and on the strength of land use considerations that were material. It did not resort to considerations that were immaterial."
Agreeing that East Bergholt's appeal be dismissed, Lord Justice Underhill said Babergh's decisions were made "on the basis of proper planning considerations" and were not "distorted" by financial concerns.
Earlier this month, an Essex council refused an application for 250 homes on an unallocated greenfield site after officers described the proposal as "poor planning", despite recognising that there is uncertainty over the authority's five year housing land supply position.