The power of the Northern Ireland Secretary to withhold sensitive information from reviews under a new legacy body is unlawful, the Northern Ireland Court of Appeal has found.
It ruled that the power of the Northern Secretary was in breach of the European Convention of Human Rights.
The issue of disclosure of such information had dogged a number of inquests which have now passed to the new body.
Families of victims had appealed a ruling of a lower court that backed the Independent Commission for Information Recovery and Reconciliation (ICRIR).
That court found the commission was capable of carrying out investigations that complied with international human rights law.
But families continued to question its independence and appealed the judgement.
The Court of Appeal ruled that the lower court had come to the proper decision in respect of the commission's independence and effectiveness.
But it raised a flag around the power of the Northern Secretary to withhold sensitive information in review cases.
It said the arguments it had received around that issue raised a "valid query".
As a result it said it was allowing the families' appeal "in part".
It also found that an inability of families lawyers to ask questions as part of the new process was also an issue.
The ICRIR was a body established under controversial UK legacy legislation introduced by the UK's previous Conservative government.
The new law found no support in Northern Ireland among politicians or victims' groups.
The commission had originally been empowered to offer those involved in murders and cases of serious injury, a conditional amnesty in return for information.
That provision was struck out by a Belfast court earlier this year and the new Labour government announced it would not appeal.
Labour has promised to replace the legacy arrangements.
But Northern Secretary Hilary Benn has indicated that he does see a continued role for a reformed ICRIR.
In recent days he has refused to establish public inquiries into a number of cases, instead pointing families towards the commission - something they have rejected.
Many victims of the Troubles say the commission is tainted by the act which established it and they want it completely replaced.
Victims' groups gathered outside the Court of Appeal to protest.
They brought shoes belonging to Troubles victims and carried placards including some calling for the resignation of the ICRIR's chief commissioner Declan Morgan.
'Our voices were heard'
The lead applicant in the appeal was Martina Dillion whose husband Seamus was shot dead by loyalists in Dungannon in 1997.
His inquest became bogged down by delays over the disclosure of sensitive information linked to the presence of state agents amongst his killers.
The hearing was cut short by the new Legacy Act and pushed into the caseload of the new commission.
Mrs Dillion appealed the ability of the commission to carry out an effective review.
She said she felt vindicated by today's judgement of the court of appeal.
"Today was a victory for us. Our voices were heard," she said.
"We have come a long road and we're not turning back.
"Give us back our inquest, let us have our day in court, that's all we wanted all along.
"We didn't ask for this commission, we want our inquest."
Gráinne Teggart of Amnesty NI said the court ruling was a "huge victory" for victims.
"The commission must go, the Secretary of State Hilary Benn spoke too soon when he said he would retain the commission.
"He should heed the judgement, scrap the commission and scrap the Legacy Act."
In a statement, the Independent Commission for Reconciliation and Information Recovery said that it notes the judgment and will "carefully consider the full written judgment and its implications".
Chief commissioner Declan Morgan said that he welcomed the Court of Appeal recognising that the ICRIR needs additional powers to disclose some information.
"It is a matter for the Secretary of State to respond to the judgment. The Commission has already welcomed his proposal to further enhance our independence and would welcome additional steps by him to address the issues identified by the court."
A UK government spokesperson said: "The Government is committed to addressing the legacy of the past in a way that can obtain the support of victims and survivors, and comply with our human rights obligations.
"We note the Court's ruling and will take the necessary time to consider our next steps on this complex judgment."
An Irish Government case challenging the UK legacy legislation at the European Court of Human Rights remains live.
