By Ian Neubauer

The City of Sydney has said it is thinking about appealing a Wednesday decision by the NSW Land and Environment Court that ruled in favour of a Kings Cross nightclub the City is trying to close.

The City had brought proceedings before the court to close down the Ladylux nightclub operating at 2 Rosyln Street on the grounds it did not have legal consent to operate as a nightclub.

A City of Sydney spokesperson said they are disappointed with the decision. It ruled the venue housing Ladylux had evolved over the years from a restaurant to a nightclub and that a 2002 development approval permitted Ladylux to operate as a nightclub.

“It’s disappointing that there is likely to be continuing negative impacts on people living nearby when the City has never intentionally given development consent for the premises to operate as a nightclub,” the spokesperson said. 

The prospect of an appeal has the tacit approval of the Potts Point and Kings Cross Heritage Conservation Society, a residents’ group that claims Ladylux is responsible for excessive noise and anti-social behaviour caused by people queuing outside the club.

The society released a statement yesterday alleging Presiding Judge Sheahan was biased in favour of the club as a result of his links to the Labor Party.

“Judge Sheahan is a former NSW State Labor Party Minister and former president of the NSW State Labour Party. While the decision was pending, there is confirmed evidence he attended a conference,” society president, Andrew Woodhouse, said in the statement.

Woodhouse also levelled criticism at Ladylux’s solicitor over comments published on TheShout’s Wednesday news bulletin that claimed the City would be liable to compensate Ladylux for legal costs estimated to have surpassed $100,000.

"Spurious claims made by Anthony Whealey, solicitor for the club, that council is legally liable to the club are a nonsense on stilts. Mr Whealey should know better than to make these sorts of statements: the court rules each side is to pay its own costs. There is no negligence on council’s part, it is upholding its public duty to protect the wide public interests,” Woodhouse said.

But Whealey said Woodhouse lacked understanding of the legal process.

“Mr Woodhouse demonstrates a fundamental lack of understanding of the court’s rules relating to costs. No such rule exists,” Whealey said.

“The Court has a discretion as to whether costs are awarded and in Class 4 proceedings of this nature. The ordinary practice is that the successful party is awarded its costs to compensate it. One need only look to the relevant part of the judgment — paragraph 105 — to see the Judge ruled;

"As the Respondent [Ladylux] has been totally successful, the appropriate order as to costs would normally be that Council pay the Respondent’s costs." 

Whealey added he would be surprised if council attempts to deny its costs liability.

“To do so would lead to a hearing on costs, resulting in perhaps another $20,000 in costs to Ladylux, which would also be paid by Council — as well as Council having to pay its own legal team for their costs,” he said.

To see the full transcript of Presiding Judge Sheahan’s decision, click here.

To comment on this story, click here.


The Shout Team

The leading online news service for Australia's beer, wine, spirits and hospitality industries.

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