WDC had not referred the non-complying applications to the authority, and had "parked" them in the hope they would comply when they saw agreeing bars have their licences renewed. Judge Hole said this was in breach of the 1989 act and was "illegal".
During last week's deliberations, council lawyer Julian Dawson said only 10 applications have been unresolved.
He said according to a council survey, 65 per cent of participants felt the central business district was unsafe after dark.
He said police reported a 10 per cent increase in alcohol-fuelled crime between 2008 and 2009.
Mr Dawson said the policy helped minimise alcohol-related crime and applied consistency in terms of holistically addressing issues such as drinking behaviour.
Des Wallace, director of Bacio, said patrons would be more inclined to leave if given a timeframe of two hours prior to closure rather than enforcing a one-way door policy. The bar owners could appeal the authority's decision to the High Court.