If footmisc package is loaded before the setspace package, then it doesn't work. Though I don't need a work around, since this is easy to incorporate in a document, I just thought that I should share this. If anyone knows the reason behind this, it will be interesting to know (unless there is a mistake in MWE).
MWE
\documentclass{report}
\usepackage[hmargin={2cm,7cm}]{geometry}
\setlength{\marginparwidth}{5cm}
%
\usepackage{setspace}
%
\usepackage[side]{footmisc}
%
\begin{document}
Tedius line of text for the main body.\footnote{This is a respectable line of drab footnote.}
\end{document}

\@footnotetext. Each one undoes the redefinition performed by the other. – egreg Dec 30 '12 at 17:36