TORONTO -- Canada failed to take reasonable steps to prevent thousands of on-reserve children who were placed with non-native families from losing their indigenous heritage during the '60s Scoop, an Ontario judge ruled in a landmark case Tuesday.

The decision in the long-running and bitterly fought class action paves the way for an assessment of damages the government will now have to pay and was hailed as a major step toward reconciliation and healing.

The lawsuit launched eight years ago sought $1.3 billion on behalf of about 16,000 indigenous children in Ontario who claimed they were harmed by being placed in non-aboriginal homes from 1965 to 1984 under terms of a federal-provincial agreement.

In siding with the plaintiffs, Ontario Superior Court Justice Edward Belobaba found Canada had breached its "duty of care" to the children. The judge also found that Ottawa breached part of the agreement that required consultation with Indian bands about the child-welfare program.

Belobaba was scathing about the government's contention that consultation with the bands would have made little difference to the children.

"This is an odd and, frankly, insulting submission," Belobaba wrote. "Canada appears to be saying that even if the extension of child welfare services to their reserves had been fully explained to the Indian bands and, if each band had been genuinely consulted about their concerns in this regard, that no meaningful advice or ideas would have been forthcoming."

Belobaba rejected the government's arguments that the 1960s were different times, and that it acted with good intentions in line with prevailing standards. As a result, the government insisted, it could not have known the harm that might have been done to the children.

"Canada's submission misses the point," Belobaba said. "The issue is not what was known in the 1960s about the harm of trans-racial adoption or the risk of abuse in the foster home."

Instead, the justice said, there could be "no doubt" that what was well known even then was the importance to First Nations peoples of protecting and preserving their distinctive cultures and traditions, including their concept of extended family.

The lead plaintiff in the Ontario action, Marcia Brown Martel, 53, a member of the Temagami First Nation near Kirkland Lake, Ont., was adopted by a non-aboriginal couple in 1972 at age nine. She later discovered the Canadian government had declared her original identity dead.

"I feel like a great weight has been lifted from my heart," Brown Martel said in a statement. "Our voices were finally heard and listened to. Our pain was acknowledged."

In Ottawa, Indigenous Affairs Minister Carolyn Bennett said the government would "absolutely not" appeal the ruling, but she also suggested more than money was at stake.

"It is really important that, as we begin these conversations about what is the best way forward for these survivors, we understand that what they are talking about are language and culture and the kinds of things that were taken from them, and they're things that a court can't really award," Bennett said.

"So, it's really important that we get to the table as quickly as possible."

Belobaba said that while the 1965 agreement, strictly speaking, applied to the Indian bands and not the children, he hoped the government would not now try to make such a "formalistic argument" given the First Nations context.

The Liberal government indicated last week it was going to try to block Belobaba from releasing his ruling after Bennett announced an intention to negotiate with '60s Scoop survivors across the country. The government relented amid outrage by the plaintiffs and critics, who called the attempt to stop the ruling unprecedented political interference.

Similar legal actions in several provinces other than Ontario are pending but none has been certified. Those cases focus on the apprehension of the children itself rather on the protection of their aboriginal identities.

Perry Bellegarde, the chief of the Assembly of First Nations, welcomed the ruling, saying children of the '60s Scoop deserve "justice, healing and reconciliation."