The alleged offences occurred yesterday at 1am.
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The officer told the court police were called by CCTV operators to a report of two males involved in an incident.
He signed for Institute in December 2015 with his manager Kevin Deery describing the 6ft1 player as a “big prescence”.
The officer confirmed it is believed the substantive injuries sustained by Mr Grace were caused by this fall.
“He was taken to Altnagelvin Hospital but his condition quickly deteriorated and he was transferred to the Royal Victoria Hospital in a critical condition”. There was blood coming from his nose and he was vomiting.
The court was told the defendant has no previous convictions.
The police officer said the defendant was recognised by the CCTV monitors and by bouncers in the local bars and he was arrested a short distance away.
The officer also said the CCTV showed both men coming towards each other and appearing to throw a punch each, after which both fell to the ground.
He said: “That would be my interpretation”.
Defence counsel Nicola Coulter said: “This is clearly a devastating incident for everyone concerned”.
He plays Gaelic football and has a full-time job.
The barrister told the court her client is a young man with a stable lifestyle who is now in employment and has no criminal record.
He opposed bail on the grounds that McDermott may re-offend and could interfere with witnesses.
He added that police have concerns about the 22-year-old’s safety due to the “public reaction to this incident”. The court heard allegations this was a “one-punch attack” and McDermott and Mr Grace did not know each other.
Deputy District Judge Peter King said that the case was in its early stages and he wanted to see how the condition of Mr. Grace went.
He said he does “not believe” the defendant is suitable for bail.
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He said there were concerns for McDermott’s safety and remanded him in custody to appear again on September 22.
