Councillors voted to refuse planning permission for 374 houses at Red Lodge in spite of being warned the decision cannot be defended.
Legal and planning officers told members of Forest Heath’s Development Control Committee on Wednesday all their reasons for refusal would be difficult to defend if it went to a planning inquiry.
The Secretary of State for the Environment last month reserved the right to call in any decision.
Crest Nicholson applied for full permission for 106 homes east of Red Lodge and outline permission for 268, with new public space and retail space in the same area.
Last month the committee deferred a decision for information on primary school provision, Section 106 money for local infrastructure and access during construction.
They were also concerned about impact on sewage problems in nearby Herringswell.
On Wednesday they were told St Christopher’s Primary is being extended to 420 places but even without the new homes Suffolk County Council forecast it needing 448 by 2016/17 and 504 in 2017/18.
Gareth Durrant, principal planning officer,said: “The development will add only 17 more pupils by the time a new school opens in 2017.”
He said it had been agreed £80,136 for libraries and £225,367 for early years learning were put back into Section 106 funds and an access route avoiding homes was planned.
An independent report concluded that there was no link between Red Lodge and Herringswell’s sewer systems, so any problems were down to the village’s system.
Cllr Simon Cole said Ofsted listed St Christopher’s as requiring improvement and the last thing they needed was more homes. He added: “If it’s going to have a detrimental impact on these children, it’s not a sustainable development.”
Others objected to impact on the school and sewers.
Mr Durrant warned them: “We’re not confident in being able to defend refusal on educational grounds.”
Refusal was moved on the grounds of impact on education, wildlife and sewage. Marie Smith, place shaping manager, went through each issue explaining how it was not supported by evidence.
Cllr Warwick Hirst said: “The reasons given are not material planning reasons. If this goes to a planning inquiry we’ll not only be paying our costs but theirs.”
He was one of two councillors who voted against refusal, with 10 for. Officers will report to the next meeting on the risks of refusal before a final decision.