South Hams councillors have refused to back a controversial change to the country's planning laws which would have helped campaigners keep the Costa Coffee giant out of Totnes.
Thousands of people signed a petition calling for the national coffee chain to be barred from opening up a new branch in the former Greenlife shop in the town's Fore Street.
But the district council's planning committee still gave the go ahead claiming its hands were tied by planning rules.
Liberal Democrat district councillors Keith Baldry and Julian Brazil wanted the entire council to pressure local MPs and the Local Government Association to push for law changes giving local authorities a bigger say over what shops are allowed in their High Streets.
But the Tory dominated district council said no by a massive 23 votes to eight as the council's Conservative leader John Tucker declared that it would be wrong to 'meddle with the free market'.
Costa Coffee is due to open the doors to its new shop in Fore Street, Totnes in the next month despite the huge campaign and the claims that it would turn the town centre into yet another High Street clone as the town's unique independent traders are squeezed out.
The Liberal Democrat's ill fated motion had declared: 'This council encourages the town's South Ham's Members of Parliament and the Local Government Association to campaign to amend national planning law to give councils greater powers to take into account whether shops are locally owned shops when granting planning permission to operate.
'The present law does appear to take account of the spirit of localism.'
The motion went on to say: 'We regret that a proposed amendment to the localism bill was defeated in the House of Lords.
'If passed the amendment would have given local councils the power to decide the mix of shops on their High Streets, rejecting those that they fear would lead to their towns and cities becoming clones.
'The amendment would have required councils to draw up retail diversity plans with the help of their residents and would be obliged to consider the plans when considering applications for retail change of use.
'They would have to take into account the balance of independent and multiple traders, unit sizes and classes of us.'
The motion also wanted the council to urge the MPs to support a private members bill which would prevent the demolition or change of use of a pub of independent shop with first winning planning permission.
Mr Baldry said the motion was being put forward in the wake of the 'appalling' and awful decision to allow Costa Coffee into Totnes which he admitted the planning committee 'had really no choice but to approve the application.'