An American war deserter could have a valid claim for refugee status in Canada, the Federal Court ruled on Friday.

In a decision that may have an impact on dozens of refugee claimants in Canada, Federal Court Justice Robert Barnes said Canada's refugee board erred by rejecting the asylum bid of Joshua Key. He ordered that a new panel reconsider the application.

Key was sent to Iraq in 2003 as a combat engineer for eight months where he said he was responsible for nighttime raids on private Iraqi homes, which included searching for weapons.

He alleged that during his time in Iraq he witnessed several cases of abuse, humiliation, and looting by the U.S. army.

When Key was back in the U.S on a two-week leave, he said he was suffering from debilitating nightmares and that he couldn't return. A military lawyer told him that he could either return to Iraq or face prison.

Instead, Key took his family to Canada and applied for refugee status.

While the immigration board concluded that some of the alleged conduct by the U.S military included a "disturbing level of brutality," it said the conduct did not meet the definition of a war crime or a crime against humanity.

Barnes said the board erred “by concluding that refugee protection for military deserters and evaders is only available where the conduct objected to amounts to a war crime, a crime against peace or a crime against humanity."

Citing a case from the U.S. Federal Court of Appeal, Barnes said officially condoned military misconduct could still support a refugee claim, even if it falls short of a war crime.

"The authorities indicate that military action which systematically degrades, abuses or humiliates either combatants or non-combatants is capable of supporting a refugee claim where that is the proven reason for refusing to serve," Barnes wrote.

Barnes said the board imposed a legal standard that was "too restrictive" on Key, who lives in Saskatchewan.

Key's lawyer, Jeffry House, said the ruling expands a soldier's right to refuse military service.

"It's a huge victory for numerous soldiers who are here and maybe others who are thinking of coming here," House said.

A spokeswoman for Immigration Minister Diane Finley said they were reviewing the court decision.

With files from the Canadian Press