Councillors rescinded last night a decision to rezone land at Nulkaba in order to check its legality.

The land was one of the developments based on the memoranda of understanding that stalled projects at Huntlee and Catherine Hill Bay in the Land and Environment Court earlier this year.

Councillors said they would also defer voting on the draft citywide Local Environment Plan (LEP) until they knew the legal ramifications of proceeding.

Cr Neil Gorman said that by rushing the citywide plan the council ran the risk of the "whole LEP falling over".

Cr James Ryan, who lodged last night's rescission motion, said the problem would affect the entire Cessnock area.

"The issue now is not only this Nulkaba amendment but a whole draft LEP that has got bits of land in it as part of a memorandum of understanding signed by the [former] planning minister," he said.

"Not only the Nulkaba amendment but the whole draft [plan] will have to be redone if someone challenges them in court.

"It's a disaster really, because council has already spent a great deal of time and money trying to explain the new [plan].

"I expect that we're going to have to re-exhibit our entire LEP at a cost of tens of thousands of dollars."

Cr Dale Troy noted that the plan had been formulated assuming that Huntlee would go ahead.

"I think this is a prudent way to go considering the monumental stuff-up that has taken place," Cr Troy said.