Peter Drummond - who led developer Grosvenor's masterplan team - said the site of the School Lane/ Peter's Lane cultural and retail centre was needed to provide a "prime retail route" between Church Street and two anchor department stores on Paradise Street.
Liverpool City Council and partner Grosvenor are seeking to compulsorily purchase (CPO) the Quiggins site to build a covered arcade of exclusive shops.
It is believed this will create a pedestrian link and carry shoppers through from Church Street to the new development, including a new John Lewis department store.
But a dramatic day of evidence at the public inquiry into the CPOs saw the Quiggins team, led by QC Robert McCracken, launch a strong defence of their right to stay in a building which now supports 45 businesses and 250 jobs.
In his opening submission, Mr McCracken said Quiggins - owned by brothers Peter and Jimmy Tierney - was part of what "made Liverpool Liverpool."
He said there were undoubted conflicts of interest between what was right for the Duke of Westminster-owned Grosvenor and what was right for Liverpool.
Mr McCracken said: "Quiggins supports the regeneration of the Paradise Street Development Area (PSDA).
"Indeed, it likes the idea so much it has been doing it for more than 10 years!
"It has breathed new life into the Palatine building. During those 10 years where has the Duke of Westminster been, where has Grosvenor been, where was Henderson?
"Indeed, how long did Henderson's commitment to Liverpool last?
"Quiggins supports Liverpool as a city of culture. Not some sub-Edinburgh, sterile, exclusive middle-class culture of subsidised opera and ballet, but people culture."
Henderson, the original financial backers of the project, pulled out in March last year.
Grosvenor project director Rod Holmes, who reiterated his desire to relocate Quiggins elsewhere in the city centre, said Henderson's decision was down to external forces.
Much of the day was dedicated to the painstaking cross-examination of Grosvenor and council witnesses by Mr McCracken.
With the QC seizing on any apparent weaknesses in evidence, a number of heated exchanges arose, particularly with masterplanner Peter Drummond.
Mr McCracken criticised the fact that Mr Drummond could not give any concise definition of what "prime retail" meant and had no figures to show the pedestrian footfall outside Quiggins.
HM Inspector Derek Mumford warned Mr McCracken twice for "bullying the witness."
Mr McCracken asked Mr Drummond to consider a situation where Grosvenor did not get Quiggins and Peter's Lane remained an open street.
The planner said it would bring the whole project into jeopardy.
He said: "For the purpose of securing retail circuits from Church Street to the southern end of Paradise Street, it is essential to have a prime retail route down that street."
The inquiry continues until Friday.
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