The Montgomery County Circuit Court has upheld the county Planning Board's approval of the 298-unit Fallsreach development in Potomac.

In doing so, the court ruled against a consolidated suit brought by the Fox Hills West subdivision and Myron and Sandra Uman, which claimed that the Planning Board had not followed proper procedures in granting approval for subdivision.

The suit alleged that residents of two neighboring subdivisions - Fox Hills West and Cold Spring - were not afforded due process of law during the board's action on the Fallsreach subdivision plans.

The plaintiffs claimed that they had suffered special damages since the board had approved the pre-preliminary plan without first providing written notice to the Fox Hills West Citizens Association. The Planning Board also approved an amended preliminary plan without giving intersested parties an opportunity for a public learing, it was claimed.

Judge Philip M. Fairbanks, however, ruled that none of the plaintiffs resented evidence showing special damages.

The suit was a consolidation of two suits, both filed against the board two years ago. One, by residents of the Cold Spring subdivision, was primarily concerned with plans to build townhouses in the Fallsreach subdivision and use those at the moderately priced dwelling units (MPDUs) that are required by law.

Plaintiffs claimed that clustering all of the MPDUs in one area of the subdivision was in violation of the MPDU ordinance which says that MPDUs must be distributed evenly throughout county. Judge Fairbanks, however, ruled that this does not mean they must be evenly distributed within a given subdivision.

The other suit, brought by residents of the Fox Hills West subdivision, was primarily concerned with plans to extend Falls Chapel Way and Coppola Drive and connect them to Fallsreach.

The Cold Spring Elementary School is on Falls Chapel Way and serves children of both Cold Spring and Fox Hills West. There are no sidewalks on the street and residents said they were concerned that the increased traffic caused by the extension of the road into Fallsreach would pose a danger to the children walking to and from school.

The 145-acre Fallsreach subdivision is being developed by C.I. Mitchell & Best Co. At present, 14 houses are completed and occupied and another 45 are under construction. Townhouse construction will be begin in 1980 and the development should be completed by 1983, according to Robert Mitchell.