NEWCASTLE'S fate is in the hands of retired High Court judge Michael McHugh. Justice McHugh has been appointed as arbitrator in the club's protracted dispute with the State Government over EnergyAustralia Stadium.

The hearing is expected to start on July 14 and last for two or three days, after which McHugh will announce a resolution that will be final and binding for all parties. It is understood McHugh, who was born and educated in Newcastle, was short-listed by the government and endorsed by Knights officials.

The 73-year-old has been entrusted with one of the most momentous decisions in the club's 21-year history. The NRL club and the Hunter Venues Authority, which manages the stadium on behalf of the government, have been at loggerheads since late last year over a number of issues relating to the ground.

The Knights have defaulted on paying almost $800,000 in rent and have refused to settle the debt until they are satisfied with the amount of compensation they receive while the stadium has a reduced capacity. They were initially served with a default notice by Hunter Venues in March and given until April 30 to pay. NSW Premier Nathan Rees extended that deadline by a month and also appointed Sydney Supreme Court barrister Michael Whelan as a mediator in the meantime.

When Whelan's mediation attempts failed and the Knights again defaulted on their commitments, the government announced it had "decided to move to independent arbitration as the most appropriate and transparent way forward".

Knights officials will be hanging nervously on the outcome. The club has close to $3 million in accumulated losses and an adverse result from the arbitration process could prove terminal.

There are a number of complicated issues that Justice McHugh will be asked to resolve. As well as the impasse over unpaid rent and compensation, Hunter Venues is keen to wrest control of the stadium from the Knights, who signed a 12-year management licence, or lease, in January last year. Knights officials say they are not opposed to relinquishing control of the stadium but believe the Hunter Venues proposal would financially disadvantage their club to the extent that it would go broke.

Justice McHugh retired from the High Court in 2005 and is regarded as an authority on issues of negligence, especially in relation to economic loss claims.

http://www.smh.com.au/news/lhqnews/stadium-stoush-could-kill-off-knights/2009/07/03/1246127696322.html

0 Replies, start dicussing now