OTTAWA -- A case involving Indigenous children taken into foster care by what all parties call Canada's "broken child-welfare system" will begin its second day of hearings at Federal Court today.

A federal lawyer argued Monday the Canadian Human Rights Tribunal overstepped its authority and erred in law when it awarded individual damages to all First Nations kids placed in foster care.

The tribunal's 2019 ruling said Ottawa "wilfully and recklessly" discriminated against Indigenous children living on-reserve by not properly funding child and family services and awarded each child, and their parents or grandparents, $40,000 in compensation.

Sarah Clarke, representing the First Nations Child and Family Caring Society, began her arguments Monday by saying Canada harmed Indigenous children taken into care, but is "shamefully" trying to avoid paying damages.

Clarke, who will continue her arguments today, said the tribunal had highlighted problems with the child-welfare system that ended up incentivizing the removal of children from their homes.

She said the discrimination First Nations children experienced from an underfunded and poorly designed system warrants the damages awarded by the tribunal.

This report by The Canadian Press was first published June 15, 2021.