Albury councillors say they have never "kowtowed" to developers, in response to criticisms by election candidate Ross Hamilton.
The council voted 5-4 on Monday night to allow two townhouses to be built on a block neighbouring Mr Hamilton's property at Brooklyn Fields estate.
Mr Hamilton had argued before councillors on November 8 that he bought his Birchgrove Crescent land after being told there was a covenant that did not allow multiple dwellings on estate blocks.
Brooklyn Fields agent Michael Walsh told council on Monday night that the estate had dual occupancy blocks from the outset.
Mr Hamilton said of the vote: "The five seeking re-election showed their vision for Albury is to kowtow to property interests and protect corporate interests over the ratepayers that they represent".
In response, Councillor Darren Cameron said it was a concern Mr Hamilton was bringing a personal issues into the election campaign.
"A councillor needs to be able to strictly separate their personal matters and their duties as a councillor and the ratepayers of Albury are entitled to ask, 'Does Mr. Hamilton have that capacity?'," he said.
Cr David Thurley also defended his vote in favour of the proposal.
"There is a covenant that that about dual occupancy, but the developer has the right to change or allow developments under that covenant," he said.
"We have to make planning decisions based on planning grounds.
"There's always an element of subjectivity, in inevitably someone's going to be not happy.
"I've never kowtowed to developers, and if you look at my record, I have often (voted against projects), because I didn't think it was in the best interest of the city."
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The votes of Darren Cameron, Graham Docksey, Alice Glachan, David Thurley and Henk van de Ven got the proposal over the line, while retiring councillors Amanda Cohn, Murray King, Kevin Mack and John Stuchbery opposed it.