The legal application argues that the Parades Commission, the body that approved the march, had 'materially misdirected itself' on the police assessment of the potential for disorder. The challenge is being brought by residents of the Garvaghy Road, a Catholic enclave in the largely Protestant town.
The stalemate has reopened what was once the most bitter parading dispute in Northern Ireland. Stand-offs between marchers and residents in the mid-to-late 1990s were accompanied by riots, roadblocks and killings.
The Parades Commission had given the go-ahead for the Orange Order parade, a decision that residents and their supporters say fails to account for the risk of serious public disorder. The Court of Appeal hearing is expected to examine whether the commission properly considered evidence from the Police Service of Northern Ireland before reaching its decision.
Representatives of the Orange Order have not commented on the legal challenge. Northern Ireland's political leaders have urged calm on all sides as the court process unfolds.