The New Lambton Football Club's Juniors have opposed the proposal to build the 12-court basketball stadium in the suburb after initial plans to build at Hillsborough were rejected in May 2022 by the Hunter and Central Coast Regional Planning Panel, which said the site was not suitable for the "scale and intensity" of the stadium.

The New Lambton club's community-level leadership says they are against building the stadium at Wallarah Oval because the spillover effect will overburden limited local sports grounds, facing an influx of new players each year even as local clubs run at or near capacity.

The club's senior-side leadership, however, accuses their juniors of "pursuing personal agendas at the expense of the club's reputation", saying New Lambton Football Club has no formal stake in the stadium build and broadly supports the consultation process.

The Eagles' club structure is internally split between its local community grades, which play under-6s through to over-35s, and the premier grades, which compete in the National Premier League with its associated junior development pathways. The two divisions, which ran independently from the late 1980s and early 1990s, reunified in 2016, but the divisions' respective leaderships have been mired by infighting for the past two years.

The New Lambton Juniors' club secretary, Megan Payne, told the Newcastle Herald on Wednesday that the community teams were already seeing pressure put on limited green spaces in the suburb, adding that players were being "displaced" by the proposed stadium project that would turn Wallarah Oval into a 12-court indoor sports centre, including a 2000-seat show court, in a staged construction project to replace Newcastle Basketball's ageing 53-year-old stadium near Broadmeadow Station.

The first stage is expected to see a "core" build of six courts while Newcastle Basketball, which received $25 million for the project in 2019, seeks additional funding to pay for stage two.

In a response after the New Lambton Juniors club comments were aired, the Eagles' senior division effectively disowned their own community branch in an unsigned statement released via its social media channels early on Wednesday afternoon, accusing the Juniors of "inciting community disharmony" by linking concerns over green space availability to the stadium project that the seniors claim has nothing to do with the club.

In an internal letter sent to Junior club members, seen by the Newcastle Herald, the Juniors leadership called an emergency meeting on March 25, a week before their stadium concerns were publicised, and accused the Eagles senior grades of trying to "take over" the Juniors' home training ground of Novocastrian Park.

The letter claims the Eagles "demanded half of Novocastrian Park for their exclusive use" in what they termed an "imminent threat" to the community side of the club.

The Juniors' letter says that the community branch has held the park's license for use and claimed an "historical usage" right, but the Herald understands that the juniors and seniors have traditionally shared use of the ground.

"Having all of Novocastrian Park available to us is even more important than ever," the memo said, and called on members to "rise and defend what is rightfully ours to use."

The memo, sent to members on March 20 ahead of the meeting on March 25, urged members to "remain steadfast in our determination to protect what we hold dear."

Attempts were made to contact the Juniors on Thursday for comment, but leaders did not immediately respond to calls.

The Eagles' senior division president, Clayton Harrison, insisted on Thursday that the internal dispute had nothing to do with the basketball stadium's construction. He said the New Lambton Football club was not an official user of Wallarah Oval and had no stake in the stadium's future.

"While we might have personal thoughts about where the basketball stadium should land, we have not been identified as stakeholders," Mr Harrison said. "NLFC is not an official user of the precinct, and we do not believe it is our place to use our position to peddle our own thoughts."

Mr Harrison expressed disappointment that the Club's infighting had tarnished the badge at a time when community clubs relied on the goodwill of volunteers to survive. Nevertheless, he stood by the Eagle's earlier statement, which accused the Junior leadership of a "systematic dismantling" of the Club over the past two years. He insisted that the imminent divorce between the community and NPL grades was not connected to the stadium project but was the legacy of long-running internal disunion.

"The Juniors have developed their own off-brand strategy, governance structures, Facebook and web pages, and an alternate logo. They've disregarded the Club's life members and revised our Club's history to suit their agenda," the Eagles' statement on April 3 said.

"These actions disrespect those who built the club and undermine the NLFC Player Development Pathway and reputation we've established over many years."

"The recent media articles and use of our brand for personal agendas is not acceptable.

"It's time for them to establish themselves as a separate entity as it's clear they no longer represent the New Lambton Eagles Football Club."

The president of the neighbouring Lambton Jaffas Juniors, Nathan Errington, declined to comment on the New Lambton club breakdown but shared the Juniors' concerns over space availability in the suburb as the basketball stadium project goes ahead.

Community sports have seen an influx of participation in the post-COVID years, he said, and clubs have been running at capacity in the community grades as local facilities have struggled to keep pace with the sport's popularity.

The Jaffas Juniors operate independently of their senior grades, and Mr Errington said the two divisions maintain good relations but said his Club was "totally against" the stadium proposal. He said local facilities needed maintenance and upgrades to keep pace with the code's expansion, with over 500 players on the Jaffas books, and said the Club was forced to turn away some new players this year because spaces were filled.

He said while the Club primarily uses Harry Edwards Oval and Lambton Park as training grounds and is not a user of Wallarah Oval - which is used by New Lambton High School as its primary green space, among other institutions and codes - where the stadium is proposed to be built, the Club was concerned that others would be forced onto Jaffas' turf if the build goes ahead.

"We believe that when we're not using it, someone's going to come and jump on our oval," he said, "There's no more space until (we) really start upgrading facilities.

"We don't use Wallarah. But that's why we're against this proposal because we believe they will start moving on to those parts when we're not using it ... (Wallarah) is a well-used space. Every time I drive past it, someone is on it.

"Where are they going to put the cricket, where they're going to put the soccer, where they're going to put Lambton High School as well?"