Cambridge scored a major victory in its fight to stop nerve gas testing when a state Superior Court judge struck down a claim by the Arthur D. Little company that its work for the Department of Defense took precedence over local regulations.

Judge Robert Hallisey last week ruled that the Constitution's "supremacy clause"--which gives federal laws precedence over state and local laws--did not apply to the case. He added that he will consider the overall reasonableness of the ordinance in a separate hearing December 27.

Hallisey left intact an earlier restraining order keeping the regulation from going into effect until the legal battle is resolved.

Last night, in a regular City Council meeting, councilors hailed the ruling but cautioned that Little will probably appeal the ruling if Hallisey decides in the city's favor next week, so the issue may be in the courts for a long time to come.

The company has said it conducts experiments with nerve and mustard gas in order to help the U.S. defend against chemical warfare and to develop protective clothing for the outlawed use of the substances.

A week ago the council unanimously passed a resolution urging the company to stop "hiding behind legalities" and immediately cease all testing of the deadly gases.

More Town/Gown

The council last night discussed Harvard's selling of two and three family buildings to faculty members who will occupy them. By selling those buildings, the University will remove them from the domain of Cambridge's strict rent control laws.

Councilor Alfred E. Vellucci said President Bok sent him a letter stating a meeting will be arranged between University officials and four councilors to discuss rent-control.

Vellucci described Harvard's policy as expansionist and against the interests of city residents.

"Harvard has created a housing shortage by its presence. It attracts people from all over the world who compete with people in the city for housing," he added.

He also described University tactics as stemming from "an undercover war" between Harvard and MIT over which university could take over the most Cambridge territory.

The council, at the request of Harvard Tenants Union Coordinator Michael H. Turk, scheduled a public hearing on the issue for January 17.

In other business, the council opened the floor for comments on a proposed five-year contract for City Manager Robert W. Healy.

The two private citizens who commented on the proposal both said they felt the contract would take too much power away from the council and vest it in the appointed post.

Healy has worked for several years without a contract at the pleasure of the council, weathering its many political storms.

Councilors reserved their judgment on the contract for a special meeting this Thursday, but some expressed doubts for the same reasons brought up by the hearing speakers.

Other councilors said Healy was doing a good job and it was only fair to give him some job security, especially in light of recent offers from other cities which the city manager has declined.