Greater Hume Shire was sued following the blaze, which started at the Walla tip on December 17, 2009, and spread through an abandoned golf course and farmland.

Five houses were destroyed, four damaged and 17 outbuildings burnt down, along with stock and crop losses.

About 5200 acres were burnt out and 57 people affected by the fire joined the class action.

Both sides are reviewing their positions after the claim was recently dismissed in the NSW Supreme Court.

Gerogery woman Sharon Patricia Weber led the legal action after losing her home, which was in the direct path of the fire.

It had been argued that the shire breached a duty of care to the residents.

The group had been seeking costs, damages and interest from the shire.

The blaze reached Gerogery about an hour after escaping the tip, with about 40 fire brigades and four aircraft used to extinguish the blaze. 

It was argued the shire should have had a fire management plan, fire breaks, waste separated into appropriate areas and firefighting equipment on site.

It had also been argued that the shire should have removed fuel such as leaves, grass and trees, and monitored the facility during periods of extreme bushfire risk.

Ms Weber and her legal team alleged the fire was started by management failures at the tip, leading to “substantial loss and damage”.

The shire, it was argued, should have foreseen that the tip waste could ignite, with risk it would spread.

Six possible causes of the fire had been identified, including spontaneous combustion, the materials dumped at the tip, or deliberate ignition, but experts said the cause could not be determined.

Justice Michael Walton said that meant “ [Ms Weber] cannot, therefore, prove that the fire was caused in breach of any duty owed by the [the shire] to her (or the other group members).”

“I find that the plaintiff has failed to prove, on the balance of probabilities, causation namely, that any negligence of the defendant caused the harm suffered by the plaintiff,” he said.

An appeal against the decision would need to be lodged by June 11.