The council is being sued for the alleged mistakes of its predecessor - Cleveland CC - over the care of a young boy named only as X.
The alleged abuser was acquitted at Teesside Crown Court of molesting X between the ages of 11 and 16 in the mid 1980s.
But X is suing Middlesbrough Council for massive damages, and today Judge Paul Collins reserved judgement on whether the local authority is responsible for X's psychiatric injuries.
Barrister Steven Foro denied Middlesbrough Council was to blame, and said they had been hampered in defending the case by the length of time it took X to launch his damages claim.
Mr Foro argued the council's defence was 'prejudiced', and said to allow X to bring his case so 'out of time' would be an 'exceptional indulgence'.
'It's of paramount importance that the defendants are able to defend the claim,' he explained.
And Mr Foro added that the council were unable to ascertain exactly when the alleged abuse occurred, unable to meet allegations of negligence or to instruct a psychologist to find out exactly what caused X's problems.
Earlier Judge Collins heard that it was X's case that Middlesbrough Council and its predecessor had failed in their 'duty of care' towards him.
But Ann Smith, who was X's social worker for some of the time he was in care, said much had been done to help him.
She explained that, when X went into a bed and breakfast, after finishing at Saltergill, far from being abandoned, his landlady treated him as one of the family.
'She took him everywhere with her, she brought him clothes, took him on family outings,' she said.
Ms Smith also argued that X had begun seeing his alleged attacker after his acquittal, and had received driving lessons from him.
'The trouble is with 16-year-olds is that they won't accept they are at risk,' she said, adding she had tried to persuade X not to see the man.
Elizabeth Ann Gumbel, for X, put it to her that more should have been done to protect him. 'That's what he needed to be protected from,' she said. 'He was under the power of the man.'
Ms Smith repeated: 'Absolutely. But the trouble is with 16-year-olds, unless you lock them away, you can't stop them doing these things.'
Ms Gumbel has told he court that the school worker who carried out the alleged abuse had been convicted of similar offences in the Republic of Ireland before he got the job at Saltergill.
She added that X was raped, and as well as being picked on by one member of staff in particular he was also handed over to other men who abused him.
'Vulnerable' X did not have an independent social worker to whom he could turn, and said reasonable steps had not been taken to prevent physiological, psychiatric and physical injury.
Ms Gumbel also argued medical examinations should have been carried out, X should never have been moved from another school, and his alleged abuser should never have been employed at Saltergill.
STRAND NEWS SERVICE