A local authority official made a "perverse" decision when concluding that a 16th-floor council flat was suitable for a woman who suffered severe vertigo, judges have said.
Hayat El-Dinnaoui's husband, Fadi, took legal action against Westminster City Council after failing to persuade staff to offer them a flat on the ground or first floor, the Court of Appeal was told.
An official who dealt with the case thought that Mrs El-Dinnaoui would settle "in time", the court heard.
But three appeal judges ruled against the council, following a hearing in London.
They said the official had not given "proper weight" to medical evidence when deciding that the flat in Maida Vale, central London, was appropriate.
Mr El-Dinnaoui had appealed after a county court judge ruled in the council's favour.