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.
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.