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Students  at Cross Lake Indian Residential School in Cross Lake, Man., in February, 1940.HANDOUT/Reuters

Survivors of Canada's residential schools for Indigenous people can destroy records of their "monstrous" abuse if they wish, because that is what the federal government promised them, the Supreme Court of Canada ruled unanimously on Friday.

The records were created when individuals seeking compensation for abuse, and sometimes the alleged perpetrators, testified in closed hearings to determine financial compensation for suffering and economic loss. The hearings were established by a written agreement between the Canadian government, which funded the schools, several churches, which operated them, and the former students.

For more than a century, 150,000 Indigenous people attended residential schools under an assimilation program launched in Canada's early years. The country's first prime minister, Sir John A. Macdonald, told Parliament on May 9, 1883, that the children would "acquire the habits and modes of thought of white men" by being removed from the influence of their parents. Many suffered physical, sexual and emotional abuse, and neglect.

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Senator Murray Sinclair, who headed the Truth and Reconciliation Commission, which examined the schools' legacy, had said the country's historical memory was at stake in the case. However, the survivors said they testified only because they had been assured of confidentiality. Two lower courts had sided with the survivors.

The Supreme Court said educating future generations through the preservation of documents should not be done at the expense of the people who testified. Those individuals, it said, had been expressly promised confidentiality in writing.

Mr. Sinclair and the Truth and Reconciliation Commission had proposed that the records eventually go to the National Centre for Truth and Reconciliation, where the general public would have been able to view them.

The Supreme Court said that would have caused more harm to the survivors.

"Their stories – which, it bears reiterating, include accounts of abuse ranging from the monstrous to the humiliating, and of harms ranging from the devastating to the debilitating – would in time be disclosed to the NCTR (and, by extension, to the public), to be applied to its project of commemorating and memorializing the residential schools system," Justice Russell Brown of Alberta and Justice Malcolm Rowe of Newfoundland and Labrador wrote for the court. "In other words, highly sensitive and private experiences would be conscripted to serve the cause of public education. But this is plainly not what the parties bargained for."

The court also said that, in 32 per cent of the cases, survivors applied for compensation on the basis of student-on-student abuse. If disclosed, such individual records could have destructive effects on communities, it said.

Perry Bellegarde, the national chief of the Assembly of First Nations, said the ruling means "we can have the best of both worlds," preserving history and privacy, if the government "reaches out and does the proper communication and consultation."

Ottawa had argued that it controlled the records and wished to preserve them. Crown-Indigenous Relations Minister Carolyn Bennett said on Friday she was "very disappointed" by the ruling because it will harm research on the residential schools.

"That analysis of the system in the churches and in government has not yet been done," she told reporters, "and that's why the Centre for Truth and Reconciliation wanted access to the documents ongoing, anonymized or whatever way you could protect the privacy."

Survivors of the residential schools had launched class-action and individual lawsuits across the country. In 2007, the government settled those lawsuits. Every former student received $10,000 for their first year, and $3,000 for every subsequent year at a school. Those who could show they were abused or subject to other wrongful acts resulting in serious psychological harm were eligible for up to $275,000 each, plus $250,000 for income loss from the lasting effects of the abuse.

The records include audiotapes, transcripts, adjudicators' decisions and application forms of the 38,000 people who sought the higher level of compensation. Because the hearings were created through the settlement of class-action lawsuits, the Supreme Court ruled that the courts had the authority to supervise the adjudication process, including deciding the records issue.

Joe Arvay, a Vancouver lawyer who represented the Chief Adjudicator of the Indian Residential Schools Adjudication Secretariat, an independent body administering the assessment of compensation claims, said the court had been wise to hold that "it is for the survivors of the residential school tragedy to control the fate of their extraordinarily sensitive and private stories of physical and sexual abuse and not Canada, which caused or contributed to the horrible harms to those survivors in the first place."

Former residential school students in Newfoundland and Labrador were excluded from the 2007 settlement and subsequent 2008 apology by prime minister Stephen Harper. The federal government announced on Friday that Prime Minister Justin Trudeau will apologize to those people in late November in Labrador, according to a lawyer for the former students.