Washington - A federal judge has awarded 720,000 dollars in damages to several victims of Hurricane Katrina, in an apparent precedent-setting ruling against the US Army Corps of Engineers.

US District Judge Stanwood R Duval Jr found in favour of four residents and one business, a decision that could support the claims of about 100,000 residents and business owners in the area, plaintiffs' lawyers said late Wednesday.

The 2005 Hurricane Katrina destroyed much of New Orleans and killed more than 1,000 people. The storm took a political toll on former president George W Bush, who was blamed for failing to rescue tens of thousands of New Orleans residents stranded for days without water, food or sanitary facilities.

The Corp of Engineers designed, built and maintained the Mississippi River Gulf Outlet canal in 1965 as a short cut between the river and the Gulf of Mexico.

Plaintiffs' lawyers argued that the Corps failed to keep the canal from widening through erosion over the years, thus providing a "hurricane highway" for Katrina as she roared ashore. Judge Duval spoke of a "funnel" effect for the rising waters.

The storm surge moved up the channel and overwhelmed the city's own intricate system of levees and canals intended to protect it from flooding.

Duval, who held the trial without a jury, ruled that army engineers were liable for the "negligent operation and maintenance" of the canal, but not for the faulty design or construction, according to Bloomberg financial news service.

The Corps was "obligated" to make sure the channel did not destroy the environment and create a hazard to life and property, he said.

"The people of this community have finally been vindicated and now they're going to be compensated," Joe Bruno, a plaintiffs' attorney, told Bloomberg.

Attorney Pierce O'Donnell, another plaintiff lawyer, said it was the first time ever the Corps of Engineers had been "held responsible for its monumental negligence."

In its arguments before the court, the Corps said the city's levees were the problem, and were inadequate to withstand Katrina's strong force.

Duval found that the Corps was aware of the danger and even considered remedial action just two years after finishing the project, but abandoned the idea as not economically justified. (dpa)