Community group Local Democracy Matters and Waverley Council are fighting a rearguard battle against the state government in a bid to stop the planned demolition of the Moore Park stadium.

With the March state election weeks away, the courtroom showdown threatens to derail the Berejiklian government's ambition to raze Allianz and build a replacement stadium for $730 million.

An expedited hearing of the case began in the NSW Land and Environment Court on Wednesday.

Local Democracy Matters, which successfully campaigned against the merger of Waverley and Randwick councils, said the government's application process for the demolition was flawed.

The group is arguing that the stadium plan had insufficient public consultation, did not satisfy design excellence requirements and failed to consider contaminated soil on the site.

The group's barrister, Tim Robertson, SC, told the court that soil analysis in a consultant's report showed traces of carcinogenic substances had been detected in landfill containing ash, cinder, slag and building rubble at the site.

Mr Robertson said those substances were in amounts "well in excess of the criteria for recreational use and environmental base criteria" and should have triggered further investigation.

"That fact was known to Infrastructure NSW and it was suppressed during the exhibition process," he said in his opening address.

He said documents outlining the possible contamination had been "in the hands of Infrastructure NSW but were never provided to the public, nor to the [Environment Protection Authority]".

"The public should have been given the detailed site investigation. It seems to have been done but it was never made available to the public."

Barrister for Infrastructure NSW, Sandra Duggan, SC, said there was "no evidence my client had this report during the public exhibition period".

"There is no evidence to support these outrageous suggestions," she said.

Local Democracy Matters is seeking a declaration that the consent for the stadium demolition is invalid and of no effect.

If its case is successful, the group wants the government to reverse the soft stripping that has started.

So-called hard demolition on the stadium's roof and walls is set to begin later this month.

Waverley Council's case, which will be heard concurrently, hinges solely on the argument that the government breached the project's design excellence requirements.

The hearing has been set down for three days.