TORONTO -- The courts must clear up the mystery of why the federal government withheld thousands of relevant documents from survivors who sought compensation for their horrific abuse at a notorious Indian residential school, a judge was told Friday.

In calling for a wide-ranging investigation into the non-disclosure, lawyer Michael Swinwood said one of the plaintiffs in the case was retraumatized by the initial denial of her compensation claim.

"There's something amiss in relation to the non-production of these documents," Swinwood told Ontario Superior Court Justice Paul Perell. "The court needs to know why is it that we're in this situation."

Two survivors of St. Anne's residential school in Fort Albany, Ont., are trying to persuade Perell to order the probe into the documents that flowed from a lengthy criminal investigation into problems at the school. The documents record details of the sexual and physical abuse of about 1,000 children who attended the school.

The settlement of a class action related to all residential schools in Canada established the independent adjudication process to hear compensation claims. One of the St. Anne's survivors, K-10106, hired a law firm to represent her.

What she didn't know, court heard, was that the firm had previously acted for the Roman Catholic Church -- essentially putting it in a conflict of interest -- and that it knew of the documents that might have helped her case.

Her claim was denied on the basis there was no sexual abuse at St. Anne's.

"She was not believed that she suffered severe sexual abuse at St. Anne's and it was student on student abuse," Swinwood said. "She was devastated by that hearing."

While K-10106 later received compensation after a review, Swinwood told the full courtroom that the first hearing and the law firm's conduct was "severely traumatizing."

Swinwood said the decision was "somehow" taken by the government and two law firms to hide documents that would have helped K-10106 and other claimants. He noted Perell has twice before ordered disclosure of the records.

"We need to know why is it that these documents are not being brought forward by Canada under the obligations of the settlement agreement," Swinwood said. "What you have before you would appear to be non-compliance with those court orders."

Whether Perell has the jurisdiction to do what the claimants are asking remains to be determined. The Court of Appeal recently ruled the courts can only weigh in on the adjudication process in rare or "exceptional circumstances."

Government lawyer Catherine Coughlan was adamant the claimants have no standing to make their case, and Perell has no jurisdiction to give them what they want.

"We have contractual boundaries," Coughlan said. "The relief that my friends seek is not open to this court to grant."

The lawyer said there was no evidence of non-compliance with Perell's previous disclosure orders, and no basis for the court to determine that further investigation was warranted.

Coughlan also pointed out that the vast majority of claims have been settled, proving justice has by and large been done.

Lawyers for the two law firms involved agreed with the government that Perell has no jurisdiction to get involved. They also "vigorously denied" the allegations of conflict of interest levelled against them.

Nevertheless, Swinwood said K-10106 and her co-claimant Edmund Metatawabin deserve answers about the lack of disclosure, because siding with the government would mean the documents stay "buried."

The court must intervene, he said, to ensure other St. Anne's claimants were not unfairly denied compensation or the residential school settlement would be undermined.

"The native peoples in this country are still viewed by the government as wards of the Crown with no equal treatment," Swinwood said. "This does not look like reconciliation."

Perell reserved his decision.