It was a system where all too often children were brutalised, sexually damaged, poorly educated and abandoned to their fate, the tribunal was told.
Incidents of physical and sexual abuse went undetected and unreported, and the worst that staff who were accused of abuse could usually expect was relocation or resignation.
"From the perspective of those adult complainants of abuse who were once children in care, it must seem that the management of Clwyd fiddled while Rome burned," Gerard Elias QC, counsel for the tribunal, said in his opening speech for phase two of the inquiry which is now in its 11th month.
He went on: "If wrongly placed or categorised by a label, the child became a marginalised and scapegoated troublemaker. All too often, it seems, the child entered the system bewildered and left it ... brutalised, poorly educated - if not positively influenced for the worse, sexually damaged and abandoned to his or her fate."
Mr Elias said there appeared to have been an environment of near paralysis at senior management level. "They were reactive and defensive."
He said this led to an out-of-sight, out-of-mind attitude: "The overwhelming impression that this created is that when, unusually, an allegation did come to light, it would be quashed by the pervasive atmosphere that protected the system, not the child within it."
He continued: "The tribunal has heard documented allegations of complaints arising out of incidents at a number of separate homes, covering a period from 1974 to 1993, which may demonstrate that a culture of avoidance and cover-up prevailed.
"If the tribunal accept the preponderance of evidence relating to allegations of abuse in Clwyd, it may find it hard to believe that no field social worker or care worker came away from a home such as Bryn Estyn or Cartrefle without saying or thinking that something was not right about the place ... did no-one think, `This place gives me the creeps?'."
The tribunal heard that between 1974 and last year there were 12 internal inquires into children in care in Clwyd and seven different management structures in the county's social services children's section. But only six of the internal inquiry reports were presented to the social services committee, and just two given in full detail.
He said that one inquiry, the Cartrefle Report in 1992, "catalogues a damning indictment of the whole organisation, management and standards of personal social services for children in care in Clwyd".
But the full report was never given to the committee on the basis that there had been concern by the council's insurers. A similar fate met the biggest inquiry of all, the Jillings Report.It was completed last year, but has never been published.
The tribunal, chaired by Sir Ronald Waterhouse, began sitting in January and is not now expected to complete its evidence-taking until February.