German car manufacturer Volkswagen has lost the first major ruling in a court case brought by owners of Audi, Seat, Skoda and Volkswagen cars in England and Wales as part of the "dieselgate" emissions scandal.

Lawyers representing the group of almost 90,000 vehicle owners say the German company knowingly installed illegal devices on cars to get around European emissions restrictions which would have led to a huge decrease in the production of nitrous oxide.

Their lower greenhouse gas emissions meant diesel vehicles were once regarded as a cleaner alternative to petrol engines, but instead they produce far higher levels of irritant gases such as nitrogen dioxide.

The 2015 revelation that Volkswagen's cars were producing higher levels than they showed in testing made headlines worldwide. Since the scandal first came to light, the company has already paid out 698 million pounds ($852 million) to more than 260,000 car owners in Germany over the same issue, as well as reaching settlements in the United States and Australia, but these rulings carry no weight in English courts, and no compensation has yet been paid, hence the new case.

Presiding judge Mr Justice Waksman called the company's defense "highly flawed" and "absurd," ruling that "the software function in issue in this case is indeed a defeat device "under the classification defined by the European Union, rejecting Volkswagen's claims to the contrary, and noting that he was "far from alone in this conclusion".

"A software function which enables a vehicle to pass the test because it operates the vehicle in a way which is bound to past the test and in which it does not operate own the road is a fundamental subversion of the test and the objective behind it," he said.

Representatives for Volkswagen said they were "disappointed" by the ruling and planned to appeal.

" (The) decision does not determine liability or any issues of causation or loss for any of the causes of action claimed," said a statement issued on the company's behalf. "Volkswagen remains confident in our case that we are not liable to the claimants as alleged and the claimants did not suffer any loss."

The head of group litigation at Slater and Gordon, the company representing around 70,000 claimants in England and Wales, called the ruling a "damning judgement".

" (It) confirms what our clients have known for a long time, but which Volkswagen has refused to accept: namely that Volkswagen fitted defeat devices into millions of vehicles in the UK in order to cheat emissions tests," said a statement issued by the company.

The ruling has not settled the wider case, however. Further hearings will take place up until toward the end of the year, to see if the device caused any damage. If any rulings on that go against Volkswagen, then the company could face another round of significant payouts to car owners in England and Wales.

"Diesel exhaust is in the same category for causing cancer as smoking, according to the World Health Organization, so to deliberately hide this toxicity cannot go unnoticed or indeed unpunished," Friends of the Earth campaigner Jenny Bates told the Guardian newspaper.