A housing association that caters only for Orthodox Jews has been cleared of discrimination in the courts – but a housing lawyer has vowed to appeal the decision.

The claimant, who has been granted anonymity by the court, had wanted a home in Agudas Israel Housing Association’s new Aviv development in Stamford Hill, but was not given the chance to bid because of their race and religion.

Their claim against Hackney Council and AIHA challenged its policy of barring anyone who is not part of the Charedi community from becoming tenants.

But the application for a judicial review was dismissed on all grounds.

Lord Justice Lindblom and Sir Kenneth Parker sitting in the High Court decided AIHA serves a specific need and that Orthodox Jewish community members’ way of life requires them to live close by each other to the extent that many prefer to stay in unsuitable properties than to move away from their community. They also recognised widespread and increasing overt antisemitism and prejudice in society, including in the private rental sector, against Orthodox Jews on account of their appearance, language and religion.

They said the arrangements were “justified” and “proportionate” and found that the actions of the council and AIHA were entirely lawful, stating: “Provided that AIHA is acting lawfully in the relevant respect, Hackney simply has no legal right or power, even if it were so minded, to insist that AIHA jettison its lawful arrangements, and to make allocation decisions without regard to those arrangements.”

But housing lawyer Rebekah Carrier, who brought the case on behalf of her clients who are in “desperate” need of rehousing, has branded the decision “worrying”.

“We couldn’t find a single other housing association which does the same thing,” said Rebekah, a director at Hopkin Murray Beskine. “I think people genuinely thought you aren’t allowed to do that any more and it may give the green light to other housing associations to do the same.

“If you saw an ad saying ‘Muslims only’ or ‘whites only’ we wouldn’t countenance that. It’s reminiscent of the stories we hear about in the ’60s when adverts for properties said ‘no blacks, no dogs, no Irish’.”

Rebekah, who has been shortlisted for awards through her work challenging the government’s bedroom tax and benefit cap, plans to appeal the practice she has branded “queue jumping”.

“In the social housing sector the law requires Hackney to have a set of rules about how housing should be allocated, and they have to follow those rules,” she said. “Here we say the council is colluding in what is obviously a discriminatory practice, and the result is that they are housing not the families in the greatest need but families of one particular religion. That’s unfair and it creates more segregated communities.

“It’s not only about my one client but it’s about how Hackney decides who gets social housing, which is massively important not least to the [13,000] people on Hackney’s waiting list.”

She pointed out that other groups are also facing high levels of poverty, overcrowding and hate crimes.

Met figures show homophobic crime is more prevalent than anti-Semitic crime, and figures for faith based crime (which include anti-Semitic crime) are lower than for racist crime.

“What makes the case unusual is it’s about blatant direct discrimination,” said Rebekah.

“I do a lot of cases about discrimination, and it’s often indirect discrimination. It’s never usually the intention to discriminate. Of course it’s of particular resonance in Stamford Hill, where we are talking about what it does to the community. It’s a strange result and strange that Hackney is part of it.”

Ita Cymerman-Symons, who set up AIHA in 1981, is delighted, however.

Last year she slammed the legal action as a “political stunt,” asking: “Which non-Jewish person honestly speaking wants to live in the midst of a building full of Haredi men with all the beards, and all the chanting on a Friday night and all the children?”

She said the ruling would help address the “imbalance, disadvantages and prejudices” faced by Orthodox Jewish families in trying to find suitable housing. “I firmly believe that our work contributes to alleviating in our small way, a national housing crisis,” she said. “We do not take properties from others, but we lessen the queue for other properties.”

The council said: “The claims against Agudas and Hackney Council were dismissed on all grounds. The judge found the council’s actions were entirely lawful.”