Dr Ian Freckelton, QC, for the children, told the Supreme Court on Monday that detainees - many of whom had at times been held in isolation for 23 hours a day - had also been exposed to capsicum spray through the ventilation systems in the Grevillea unit of the maximum-security prison.

These, Dr Freckelton said, were examples of a facility "incapable" of meeting their human rights in detention.

Details about the conditions in the unit were revealed on the first day of a fresh legal challenge against the state government's move to re-classify it as a youth justice centre.

It comes as Victorian Ombudsman Deborah Glass announced she would investigate how the state's prisons and other places of detention are monitored.

The Turnbull government in February decided to allow independent UN inspections to prevent abuse in detention.

The Andrews government began transferring children from two youth justice centres to the Grevillea Unit last year after a riot at Parkville youth justice precinct destroyed more than 60 beds.

The government re-classified the unit as a youth justice centre on December 29, days after the Court of Appeal ordered it move the children elsewhere and ruled that the state had not given proper consideration to the human rights of the prisoners.

Dr Freckelton said there was no proof that anything had significantly changed in the unit.

There were 15 children in the 36-bed unit on Monday, who were all on remand awaiting court cases, the court heard.

A gold, silver and bronze "behavioural management" ranking system was in place at the unit, Dr Freckleton said.

Children with a gold ranking were allowed to stay outdoors for longer periods of time than those with a silver or bronze ranking. Those with a bronze ranking had more limited access to visitors, including to family members and their lawyers, until March, when this part of the system was removed, the court heard.

The government had no power to re-classify the unit as a youth justice centre, Dr Freckelton said, because it was incapable of meeting the legal rights of children, including catering to their developmental needs. There was still no registered school at the unit.

Richard Niall, QC, for the government parties, said it was "not only just, but inevitable" that the children were moved after the Parkville riot, because their safety was at risk if they remained there.

The Grevillea unit was the "best alternative" to meet their needs while Parkville was being rebuilt, he said.

Mr Niall said the unit was providing education to the children, with five to six Parkville College teachers holding classes.

Minister for Children Jenny Mikakos had considered the advice she received on the capacity and staffing levels at the Grevillea Unit when she decided it was in the best interests of the children to move them there, Mr Niall said.

The trial before Justice John Dixon continues.