A police cover-up surrounding the plastic bullet killing of an innocent woman led to a breakdown in the rule of law, the High Court heard on Thursday.
Lawyers for the husband of Nora McCabe claimed officers closed ranks and lied under oath to shield two colleagues from facing murder charges.
It was also contended that video footage from the scene in Belfast 28 years ago "comprehensively destroyed" police accounts of what happened.
Jim McCabe is seeking a court order to quash the decision not to charge the sergeant who fired the fatal round or his commanding chief superintendent with either murder or manslaughter.
Both men have since died.
They are also challenging a decision not to prosecute any officers for perjury or attempting to pervert the course of justice at the inquest into Mrs McCabe's death.
The 33-year-old mother of three was killed in July 1981 by a baton round fired as she returned from the shops to her home in Linden Street, west Belfast.
Opening the application for judicial review in front of a three-judge panel, Barry Macdonald QC claimed decision makers must have "taken leave of their senses" to find the case did not meet the standard for prosecuting.
The barrister said the baton round was fired "for no good reason" by a police sergeant from a Land Rover.
It fractured Mrs McCabe's skull and led to her dying the next day without regaining consciousness.
A direction for no prosecution was given largely because it was not clear who fired the baton round.
Mr Macdonald said police gave evidence under oath at the subsequent inquest before the family disclosed that they had a video tape which, he claimed, demolished the officers credibility.
This footage, from a Canadian news crew covering events surrounding the republican hunger strikes, was played in court.
Mr Macdonald said despite its emergence, the Director of Public Prosecutions still declined to bring any charges against officers for murder, manslaughter, perjury or attempting to pervert the course of justice.
The barrister contended their judgment proved correct because the Royal Ulster Constabulary carried out an investigation and recommended no prosecutions.
He told the judges hearing the case: "What this court is invited to do in determining this application is to vindicate the rule of law by granting the relief sought."
Paul Maguire QC, responding for the DPP, stressed that the coroner who heard witness accounts and viewed the film during the inquest could have reported a view to prosecutors that a criminal offence had been committed.
"That did not occur in this case," Mr Maguire said.
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