By Ian Neubauer

The City of Sydney has forked out $65,000 to cover the legal costs of a Kings Cross nightclub it targeted for closure in a protracted two-year long courtroom drama exposed by TheShout early this year.

The City had insisted Ladylux nightclub on Rosyln Street lacked ‘legal consent’ to operate as a nightclub, despite its holding of a Public Place of Entertainment License issued in 1987 and a Nightclub License issued in 1994.

Ladylux proprietor, Scott Bayly, also alleged the City had deliberately redrawn the boundaries of the Kings Cross Entertainment District to deprive the club of its late-night trading rights while the aforementioned proceedings were underway.

But NSW Land and Environment Court ruled in favour of Ladylux on all counts in May, paving the way for the awarding of legal costs Bayly had incurred in defending his club against the City.

The City of Sydney said at the time it had taken legal action to close Ladylux after it continued to trade following a previous Land & Environment Court decision that supported the City’s 2006 refusal of an application to change the use of the premises from a restaurant to a nightclub.

It also said it was considering lodging an appeal, claiming Ladylux was negatively impacting on the lives of nearby residents who had issued repetitive complaints.

But the City changed its tune this month and agreed to pay $65,000 in a move that lawyers said brings complete closure to the matter.

“The payment gives Ladylux some measure of compensation for the costs it was put to as a consequence solely of the City’s error in misinterpreting its own records of approvals for the site,” said Gardens Lawyers partner, Anthony Whealy, who represented Ladylux in court.

“Council has accepted the inevitability of a costs order and accordingly made payment to the Ladylux rather than incurring more legal fees by arguing over costs in Court.”

A spokesperson for the City said it now respects the court’s decision and would not lodge an appeal.

It justified the large expenditure of ratepayer’s money to “protect the interests of local residents”. 

Complaints against Ladylux were funnelled though The Potts Point and Kings Cross Heritage Conservation Society, a resident’s group that alleged the club was responsible for noise violations and the anti-social behaviour of patrons queuing at its doorway and meandering in an adjacent alley.

Contacted this week, Society president Andrew Woodhouse refused to say if the situation on Rosyln Street had been remedied after claiming TheShout was patently biased.

In May, Woodhouse levelled accusations of bias at Judge Sheahan, the magistrate who had presided over the Ladylux case. Woodhouse also insisted the City had no obligation to bear Ladylux’s legal costs because it was “upholding its public duty to protect the wide public interests”.

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The Shout Team

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