FYLDE Borough Council must pay £1,000 compensation following a planning blunder.
The council gave permission for new hen cabins at an unidentified farm near housing.
But an Ombudsman's report says that the units would probably have been turned down if the application had been properly considered.
The £1,000 will go to a nearby resident who complained and suffered injustice following the maladministration.
A farmer had said the new units were needed to comply with new legislation giving battery hens more room.
But, said the local government Ombudsman, neither the council nor the county council, who were consulted, could confirm this was the case.
"The fact that the report to the planning committee was based on an untested assumption was maladministration."
When the resident raised this issue, a letter written on behalf of the borough chief executive said that the issues were the responsibility of the county council.
The council, said the Ombudsman, "should not try to shuffle off blame for those decision onto someone else."
The council is also slammed for failing to make a thorough evaluation of the impact on the resident and his neighbours of increased noise and smell from the units.
"The council did not give proper consideration to the environmental impact of the development which it was required to consider. Contact between planners and environmental health officers at the proper time should have enabled it to do so."
The buildings containing birds and potentially noisy machinery may affect the resident but so far there had been no nuisance from noise or smells.
The report concluded that the council should consider the criticisms and take lessons from them.
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