TORONTO - Ontario risks undermining confidence in its justice system if it does not address compensation for innocent people who were wrongly accused of killing children in cases handled by disgraced pathologist Dr. Charles Smith, a public inquiry heard Monday.

It would be "absurd'' for the inquiry probing Smith's mistakes to make recommendations to improve the province's pediatric forensic pathology system while ignoring the very people whose tragedies prompted the inquiry, said Peter Wardle, who represents several families affected by Smith's errors.

"You're leaving a very important part of the story off the table,'' he told Justice Stephen Goudge, who is leading the inquiry into pediatric forensic pathology in Ontario.

"The public at large, they know what's happened to these families, and they know the tragedies and what they've been through. And to restore public confidence, to right the justice system -- if I can put it that way -- in my submission you have to deal with that issue.''

Wardle's remarks led final arguments at the inquiry, which was called after an expert panel questioned the findings in 20 of the 45 autopsies performed over a 10-year period by Smith, who was once considered a leading pediatric forensic expert in Canada.

Twelve of those 20 cases resulted in criminal convictions.

Lawyers for the Ministry of the Attorney General have argued that compensation is outside the scope of the inquiry's mandate and is best dealt with through existing channels, such as civil actions and mediation.

That suggestion is the "polite equivalent to 'go fish' for these families,'' Wardle told Goudge.

"It would be, in my submission, absurd and inequitable for you to make recommendations to the government of this province about long-term funding for a new, improved coroner's organization and leave on the sidelines the very individuals whose cases, whose tragedies, have brought us here to begin with,'' he said.

Ministry lawyers were quick to point out that the government is not ruling out compensation.

"The government is not saying -- let me repeat myself -- not saying 'no compensation' to people that have suffered,'' Bill Manuel said during final arguments.

"But the evidence is not before you to create a whole alternative system.''

Manuel also brushed off recommendations that the province expand its review of pediatric autopsies and "shaken baby'' or head injury cases that led to criminal convictions -- contrary to the opinion of its own expert -- as well as suggestions that the federal and Ontario governments revamp the way they review convictions.

The inquiry is already examining Smith's work from 1992 to 2002, and an internal review of his earlier cases from 1981 to 1991 is ongoing.

Compensation should be a part of the inquiry, said Brenda Waudby of Peterborough, Ont., who was jailed after being accused of beating her toddler to death in 1997. Ultimately, the child's babysitter admitted to killing Waudby's 21-month-old daughter.

"I believe it was a whole, complete system failure,'' Waudby said.

"I don't believe that it was just one doctor. It was everybody all helped each other to get through this.''

Wardle argued that during his stint as director of the Ontario Pediatric Forensic Pathology Unit at Toronto's Hospital for Sick Children, Smith wasn't held accountable for his errors, nor did anyone take responsibility for them.

He laid much of the blame on then-chief coroner Dr. James Young and deputy chief coroner Dr. Jim Cairns, who oversaw many of Smith's cases.

Earlier in the inquiry, Cairns suggested that Smith was held in such high regard that none of his contemporaries would dare second-guess his work. He said he only started to question Smith's findings after it came to light he took a hair found on Waudby's daughter and kept it like a souvenir for five years before handing it over to police.

Young also expressed remorse during the inquiry for failing to act on complaints about Smith.

Smith suffered from a lack of professionalism, competence and objectivity, which led to numerous mistakes that sent innocent people to jail, Wardle charged.

But the "symbiotic'' relationship between Smith and the coroner's office also greatly contributed to the lack of oversight, he said.

"It meant that the chief coroner's office, having had a major role in building up the reputation of the icon, was reluctant to tear it down because of the ramifications for the reputation of the office and for Dr. Young himself,'' Wardle said.

It also helps to explain why Smith was "sheltered and protected'' by Young in particular in 2001 and beyond, he added.

Final arguments were to resume Tuesday. Goudge is expected to deliver his final report Sept. 30.