Earl's £100m housing plan is a non-starter with racing elite

The plan is so unpopular locally that it handed election victory to the Earl's nemesis, Rachel Hood, a lawyer married to the Newmarket trainer John Gosden

There is no one more famous in British racing than the Earl of Derby. His ancestor, the 12th Earl, sponsored the race on Epsom Downs which has been a fixture in the annual sporting calendar since 1780.

But the 19th Earl is not the racing fraternity's favourite aristocrat. Yesterday, a public inquiry opened in the council offices in Mildenhall, in Suffolk, in which the Earl is pitted against some of the most influential figures in racing, and against local opinion around Newmarket.

The Earl wants to build 1,200 houses on a site called Hatchfield Farm, just outside Newmarket. His application was turned down last June by the local authority, Forest Heath District Council, based in Mildenhall, and has now gone to appeal before the Planning Inspectorate. A decision is unlikely to be reached before December.

The plan is so unpopular locally that it has handed a double-election victory to the Earl's nemesis, Rachel Hood. She is a lawyer, married to the Newmarket trainer John Gosden. In May, she stood for Forest Heath Council as a Conservative and won, displacing a Liberal Democrat – a victory she attributed to the support she picked up as founder of the Save Historic Newmarket Action Group, formed to thwart the Earl's building plans. She has since been elected chair of the planning and development committee of Newmarket Town Council.

Another vociferous opponent of the Earl's plans is Sir Michael Stoute, who trained the Queen's horse Carlton House, which came in third at Epsom. With almost the whole of Newmarket's racing elite lined up against him, the Earl has hired the former royal household spin doctor, Mark Bolland, to help make his case.

He also sent an email to some of the racing elite's leading members, hoping to defuse opposition. He said in the email that he wanted its contents kept private "because I have no wish to generate any publicity for my argument". It was sent on 2 June to the Jockey Club, to Tattersalls, the largest bloodstock auctioneers in Europe, and to Sheikh Mohammed, ruler of Dubai, who has pumped billions into racing.

But the Newmarket trainers who have seen the email are unimpressed. "The 'poor me' letter is ridiculous and insulting," one said.

One of the claims it made was that "there are over 800 people on the council's waiting list for homes in Newmarket". In fact, there are 536, and of those 50 per cent are from outside Newmarket. The Earl also claimed that a "show home" on the nearby Studlands estate had been closed because all the houses had been occupied, yet there are numerous estate agents' boards offering houses for sale or to let.

The Hatchfield Farm site is next door to the Earl's family-owned horse-breeding operation, the Stanley House Stud, where the wonder horse Ouija Board, which won more than £3.5 million between 2002 and 2006, was bred.

If the Earl succeeds in obtaining permission to develop the site, it could be worth £100m to him. He is already a wealthy man, with a 2,500 acre ancestral estate at Knowsley, near Liverpool. But the latest published accounts of the Knowsley Estate Company show creditors are owed more than £440,000.

The Earl has said: "Whatever the decision of the Planning Inspectorate, I will remain genuine in my love for Newmarket."