The Ombudsman's report used a complaint from a farmer in regards to a former Wellington Shire mayor as a case study into preferential treatment by local governments.

The complaint concerned the issuing of a planning permit for land forming works for the former mayor without following due process.

In the ensuing investigation, it was found the council did not take action against the farmer's neighbour for completing works without a planning permit, and council issued the neighbour with a permit despite receiving an objection.

The alterations to the neighbour's land resulted in regular flooding to the farmer's land, according to the report.

"My investigation also identified that the council's preferential treatment continued when the neighbour sought an amendment to the planning permit to build a water reuse dam,'' Ombudsman G E Brouwer stated in the report.

The report states council "selectively applied'' expert advice from the West Gippsland Catchment Authority and "assumed drainage responsibility without relevant technical knowledge''.

"I determined that during this process the council disregarded the expert advice it sought and made ill-informed decisions which resulted in flooding of the complainant's property,'' the report states.

When the farmer approached council to review the changes to the permit conditions, council threatened to take enforcement action unless the complainant removed an embankment that had been constructed on their property to prevent flooding.

As a result, an engineer was contracted to provide a detailed assessment of the disputed areas, which confirmed the need for an embankment on the complainant's land.

"My investigation demonstrated a marked difference in the council's treatment of the complainants and their neighbour,'' Ombudsman Brouwer states in the report.

"There was a strong inference that the neighbour received preferential treatment because he had been a councillor and the mayor."

The Gippsland Times phoned Wellington Shire Council for comment on the case study, but the council failed to respond by the time of publication.