Pushing for a vote ... Energy Minister Chris Hartcher.

Pushing for a vote ... Energy Minister Chris Hartcher. Photo: Simon Bennett

The NSW Liberal Party has lost a Supreme Court battle over changing the way candidates are selected for state and federal seats and is likely to have to put the issue to a vote later this year.

The decision potentially throws the party's preselection timetable into disarray before next year's federal election.

This is because a new preselection system allowing direct election of candidates may need to be developed if the party's constitution is changed by a vote of at least 60 per cent of state council members.

In comments this afternoon, Justice William Nicholas said the Liberal state executive was wrong to exclude a motion to debate direct election and a change to the powers of state executive at this Saturday's state council meeting.

The hard right faction of the Liberal Party, including the Energy Minister Chris Hartcher, had been pushing for a vote.

But the state executive, which is controlled by the left and centre right factions, instead decided both issues would the subject of a non-binding policy debate.

The right faction believes direct election will empower grassroots members by removing the influence of state executive in preselections. But the left and centre right fear it will lead to branch stacking in seats held by vulnerable MPs.

The right believes state executive has abused its special powers which allow it to override the wishes of branch members in preselections.

The issue blew up earlier this year when candidates were imposed in Dobell and Robertson.

It was the Robertson branch that proposed that motion, put by Mr Hartcher in May.

Justice Nicholson has yet to issue final orders. Counsel for the Liberal Party and the plaintiff - a central coast branch member, Denis Pogson - are negotiating over whether the Saturday meeting will go ahead.

On Monday, lawyers for Mr Pogson offered to allow the meeting to proceed but then be adjourned for 21 days so a new motion for a vote could be placed on the agenda. This was rejected.

The Liberals have yet to choose candidates in 12 NSW seats including the ultra marginal western Sydney seat of Greenway, which they expect to win.

The decision is embarrassing for the Premier, Barry O'Farrell, who recently called for the vote to be deferred until next year.

The potential delay in preselections will also upset the Opposition Leader, Tony Abbott, who blamed his 2010 election loss on late preselections in NSW, particularly on the central coast and western Sydney.