Northallerton could lose one of its oldest businesses now that councillors have thrown out a scheme to move the auction mart close to a residential estate.

In a unanimous vote yesterday, Hambleton's development control committee rubber-stamped a recommendation by planning officers to refuse the application.

The outcome had been widely expected after planning officers revealed last week that the application to relocate along Thirsk Road - close to the St James' area - did not meet crucial criteria.

Northallerton Auctions director, Alan Harrison, said the company could now have to consider leaving the town, severing ties which go back nearly 100 years.

"The company is one of the oldest established businesses within the town and to its wide customer base is still considered to make an important contribution to the prosperity and vitality of Northallerton," he said.

"We think this would be a sad loss of business and a reflection on the town."

Mr Harrison said the only other option for the firm was to stay put at its Applegarth site for the foreseeable future.

A last-minute statement by the company was given to councillors yesterday. This set out Northallerton Auctions' own suggestions for addressing concerns about the move. It also asked for a decision to be deferred while these were considered in detail.

"Democracy and the planning system in particular can be seen as a frustrating business for all parties," said Mr Harrison.

"Regrettably, the process is sometimes inclined to take the line of least resistance.

"While it is not surprising in this case, it is nonetheless disappointing that the company, having tried to address many areas of concern, has not been afforded the chance to have the application deferred as requested, to enable further clarification and attend to remaining outstanding objections.

"We have, however, adopted a philosophical approach and are quietly confident these can be resolved and must now consider our various options."

The controversial scheme had sparked a huge swell of protest from residents who sent in more than 600 individual letters of objection to Hambleton Council.

Concerns included traffic problems, noise, smell and flooding risks.

After the decision, action group leader Bob Beaver said: "There is just absolute relief that the council has heard our views. We were worried we were not being listened to.

"This is a great result."

Earlier, residents' spokesman Malcolm Lloyd told councillors that people agreed Northallerton should not become just a dormitory town and that there should be industry and commerce, even close to the centre.

"But those who made their homes to the south of the community did so with regard to quality of life which your planning policies promoted but which this development so directly contravenes," he said.

The later statement from Northallerton Auctions asked the committee to consider the following ideas for addressing concerns:

* Flooding - a flood risk assessment report the company felt would satisfy Environment Agency's objections.

* Highways - statements about "unacceptable problems" were misinterpreted and not consistent with the highways authority's views.

* Impact on landscape and surrounding countryside - high hedging and trees to be supplemented by further extensive planting and screening.

It was felt this would ensure the site was invisible from Thirsk Road and that its effect on St James would be insignificant.

* Impact on residential amenity - the company's existing premises are considered incompatible with a town centre but for reasons of traffic and safety. Neither would be an issue on the Thirsk Road site.

"The company would not wish to be associated with a scheme which could cause unnecessary distress or which adversely affected amenity," said Mr Harrison