A council in Dorset which spied on a family to see if they lived in the right school catchment area has lost a landmark ruling over its actions.
Jenny Paton took Poole Borough Council to a tribunal after it used the Regulation of Investigatory Powers Act (Ripa) to spy on her family 21 times.
The Investigatory Powers Tribunal ruled it was not a proper purpose and not necessary to use surveillance powers.
Miss Paton said she was delighted. The council said it accepted the ruling.
It is the first time these powers have been challenged at an open hearing before the Investigatory Powers Tribunal (IPT).
The IPT also found that the surveillance breached the family's right to privacy under Article 8 of the Human Rights Act, when it ruled on Friday.
The council had argued that the covert surveillance, which took place between 10 February and 3 March 2008, was lawful under Ripa for the over-subscribed and successful Lilliput First School.
Two phone calls to the council were made by members of the public making formal complaints, alleging that the family was not living at the property in the catchment area.
The second caller said Miss Paton had boasted about pretending to live in the property.
The family also owned two flats in another property out of the catchment area and both addresses were kept under surveillance.
Miss Paton, from Poole, only found out she had been under surveillance when it was revealed during a meeting with council officials to discuss their school application.
They were tailed round the clock, spied on at home and their movements were recorded in detailed surveillance forms. Their car was also described as a "target vehicle".
After the tribunal ruling, Miss Paton told BBC News: "It is absolutely brilliant. We are hopeful our case will highlight local authorities' misuse of Ripa [powers].
"The highest legal minds have found Poole Borough Council was wrong even when it was adamant it was right.
"It is a damning indictment into how they behave - paying no attention to considering the impact of putting children under surveillance."
Ben Hooper, representing the local authority, had told the tribunal the surveillance "was minimally invasive of privacy".
'Nothing to fear'
But in statement the council said: "The council accepts fully the ruling of the Investigatory Powers Tribunal and would like to apologise to Miss Paton and her family for any distress caused as a result of its actions in this case.
"The council listened to public concerns about this case and subsequently decided that Ripa powers were no longer an appropriate means of investigating potentially fraudulent applications for school places."
Corinna Ferguson, legal officer for Liberty, said: "Intrusive surveillance is vital to fighting terrorism and serious crime but weak legal protections and petty abuses of power bring it into disrepute.
"Former ministers claimed that the innocent had nothing to fear but the sinister treatment of Jenny and her kids proves that these powers need to be far more tightly restricted and supervised."
A Local Government Association spokesman said councils needed the powers "to target serious criminals such as fly tippers, rogue traders and benefit fraudsters", but agreed they should be used "proportionally" and in a way that ensured public confidence.
The government is reviewing the use of Ripa powers - which cover all types of serious crime - by local authorities as part of the Counter Terror Review announced by Home Secretary Theresa May last month.