Campaigners claim the last sanctuary of peace and quiet in Jericho, Oxford, is under threat if developers get permission to build a block of flats.

A three-year battle by Oxford firm W Lucy and Co to build six two-bedroom flats on land at 44-49 Juxon Street will be determined by a Government-appointed planning inspector after city councillors, planners and developers failed to agree a way forward.

People living near the proposed development Wharf House Mews which has been in the pipeline since 2003, say the peace and quiet of neighbouring St Sepulchre's Cemetery will be lost forever if the flats are built.

Lucy's, the last manufacturing firm in Oxford, has already sold its Jericho factory site to Berk- eley Homes, which has embarked on a large housing development.

At a hearing in front of planning inspector John Colburn, company representatives argued the latest scheme made the best use of previously developed land. The inspector has yet to make a judgement.

Peter Strong, chairman of the friends of St Sepulchre's Cemetery, said: "We look at this cemetery as an amenity used by the Walton Manor and Jericho communities as a place where people can relax. It is a very safe and nice place to go."

Planner Nick Lyzba, for Lucy's, said: "What is proposed is a contemporary design scheme and we make no apologies for that. There is no reason, in this day and age, why we could not be providing striking buildings as long as what is being proposed sits happily in its context and we say it will."

Jenny Mann, of Victor Street, Jericho, said: "If I sit in my back garden I am besieged by radios and people overlooking my home. The cemetery is the only place where I can wander among the trees and flowers it's a quiet little oasis."

Jericho and Osney city councillor Susanna Pressel added: "This cemetery is the only place you can sit, relax and take in the surroundings."

Oxford City Council has been heavily criticised by external auditors for the number of planning applications it loses on appeal.

Each time a developer appeals against a decision and wins, the authority has to pay costs.

Earlier this year the Oxford Mail revealed that the city council's planning department was considering giving councillors crash courses in planning law because so many were refusing applications for reasons that were deemed unacceptable by inspectors.