The threat, received this week by the government-appointed council, follows an administrative appeal that resulted in the trust's ACT branch being denied legal standing to argue for protection of the rundown 1960s buildings.

Lawyers for the National Trust are seeking the public consultation begin from scratch for a second time, or they will commence legal action in the ACT Supreme Court on Tuesday.

The trust was excluded from the original consultation process because it did not respond to the heritage council's protection order for about 40 per cent of the precinct within the mandated four-week period.

On May 22, lawyers argued in the ACT Civil and Administrative Tribunal that it had been unfairly excluded because the four weeks was advertised as ending on October 22 last year. Rules set out in the territory's Heritage Act required submissions to be received by October 20.

Despite being responsible for error, the Heritage Council was not required to reopen the public consultation period.

Council chair David Flannery confirmed he had received a letter from the National Trust asking for a second consultation, in order for the trust to be able to argue for protection of the whole precinct. It includes the Dickson Towers, Owen Flats, pair houses, three-storey flats and maisonettes designed by noted Australian architect Sydney Ancher.

On Thursday, Chief Minister Andrew Barr announced development applications would be lodged for the demolition of nearly the entire precinct and the Bega and Allawah flats. The government is also seeking approval for redevelopment of the Currong and Allawah apartments site.

Despite heritage protection being in place for about 40 per cent of the post-war international modernist-style homes, Mr Barr wants only the two northern‐most bedsitter flats and one grouping of pair houses to be retained.

Mr Flannery told the Canberra Times he believed the government would sideline the heritage council to proceed with development of about 1100 privately-owned homes.

It could use development call-in powers to push ahead with bulldozing, central to its plans for a light rail line and receiving $60 million in infrastructure payments from the Abbott government.

Mr Barr lashed the council's ruling announced in February, and said recently he would use every available legal avenue to proceed with demolitions.

Heritage experts have repeatedly warned the government the precinct is a unique example of National Capital Development Commission architecture and important to Canberra's public housing history.

Mr Flannery said the National Trust believed the council had produced a defective heritage protection notice. He said starting the process again would cause delays of as long as six months.

Members of the council will meet with lawyers on Tuesday, before responding to the National Trust threat of a new legal action.

A spokesman for the National Trust ACT branch would not comment on the dispute on Friday but confirmed the letter was being considered.

The government is planning to work with the Gallery of Australian Design to record the precinct's heritage after demolition takes place. The ground floor of the Lyneham Tower could also become home to a new heritage museum for the area, an idea welcomed by Mr Flannery.