The claim by "Mr Y" was first filed with the courts in 2006.
Sonja Cooper, the principal of Cooper Law representing representing "Mr Y," said the claim was intended to test matters of fact and responsibility in the court and she had claims by another 50 former Whakapakari residents waiting in the wings on the court ruling.
Ms Cooper said part of the government's defence involved disavowing any responsibility for any actions undertaken by independent contractors, despite receiving years of warnings and complaints.
Last year Whakapakari was the subject of a Weekend Herald investigation that found complaints in 1998 about four boys claiming to have been subjected to mock executions, including being forced at gunpoint to dig what they were told would be their own graves, were mishandled by government overseers.
A review of the case by the Commissioner for Children found serious holes in the official version of events.
"Mr Y" is not one of the four boys but his claims of sexual abuse by staff, management-sanctioned pack beatings by other residents, and unsupervised exile with no shelter and minimal food are similar to experiences of more than a dozen residents spoken to by the Weekend Herald.