Community leaders are to reconsider the go-ahead for 55 new homes at Melton - after opponents indicated legal action might be taken.
East Suffolk councillors approved proposals from developers Warburg Dawson Partnership a year ago.
But the planners then received a letter from solicitors acting for nearby residents saying that a judicial review could be sought in the Hight Court.
Case officer Rachel Smith said the letter claimed the planning committee had been misled over whether the highways authority had formally objected or simply raised concerns.
It also considered the committee had been advised incorrectly regarding potential costs that could be sought against the council in the event of an appeal.
Ms Smith said the council disputed the claims - and had provided recordings of the meetings as evidence - but had said the matter would be reconsidered by the planning committee.
The south area planning committee will meet on February 22 to look afresh at the plans - and is again being recommended to approve the proposals, subject to conditions.
In order to achieve a safe and suitable access, extra highways works are proposed further along St Andrews Place and onto Station Road - including crossing points, new lengths of footway, widening existing footways and providing additional parking spaces.
Nearly 100 people objected to the plans originally, and a report to go before councillors says 64 more protests have been received in the past year. Concerns include worsening queues at the already over-capacity Melton traffic lights, noise, pollution, and lack of community benefits.
Despite some additional works, Suffolk Highways still objects to the planning application due to construction access, traffic impact and sustainable access but does accept that the scope of improvements to St Andrews Place has progressed as far as is feasible and the improvements would provide a benefit to the flow of traffic and improve pedestrian safety.
The project effectively forms the second phase of plans to develop the wider site, the first being the Riduna Park development for businesses, while the remaining land will come forward for development in future.
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