An appeal against the refusal for development of the Hotel Australasia site was heard in the Land and Environment Court for the first time on Monday.
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The administrative hearing determined that the respondent, Bega Valley Shire Council, must supply the court with a statement of facts and contentions by Monday, May 5, outlining the reasons behind their refusal of the Development Application (DA).
Great Southern Developments will then be given a week to respond, with a directions hearing on May 19 then determining whether the matter will proceed to court.
Bega Valley Shire Council rejected a development application (DA) from Great Southern Developments in February, with the developer proposing to build a supermarket, liquor store and retail tenancy on the site of the 110-year-old building.
Council then passed a motion last month to include the building under Schedule 5 of the Comprehensive Local Environment Plan 2013 as a heritage item.
Great Southern Developments director Rodney Thompson maintains that his company intends to demolish the hotel and carry out its original plans if successful in the appeal.