GENEVA, Aug 30 (Reuters) - A U.N. investigator condemned an Israeli court on Thursday for clearing the military of blame for the death of American activist crushed by an army bulldozer, calling it a victory for impunity.

The ruling handed down on Tuesday on the civil suit brought by the family of Rachel Corrie was part of a pattern of decisions exonerating Israeli military actions and political leaders, said Richard Falk, United Nations special rapporteur on human rights in the occupied Palestinian territories.

The judge's decision represents a defeat for justice and accountability, and a victory for impunity for the Israeli military, Falk said in a statement issued in Geneva.

Corrie's family accused Israel of intentionally and unlawfully killing their 23-year-old daughter in March 2003, launching a civil case in the northern city of Haifa after a military investigation found the army was not responsible.

Corrie had joined activists trying to stop the Israeli army from demolishing houses in the southern Gaza town of Rafah during a Palestinian uprising. The family has said it will appeal the ruling.

Judge Oded Gershon said the death was a regrettable accident and invoked a clause that absolved the army because the incident had happened during a wartime situation.

But Falk said that the decision flies directly in the face of the Geneva Conventions, which impose on an occupying power an unconditional obligation to protect the civilian population.

As an aid worker, Corrie was entitled to protection by occupying forces and the house demolition appeared to violate the pact's prohibition on targeting civilian property, he said.

This is a sad outcome, above all for the Corrie family ... but also for the rule of law and the hope that an Israeli court would place limits on the violence of the state, particularly in relation to innocent and unarmed civilians in an occupied territory, he said.

Falk, an American expert on international law serving as an independent U.N. expert since 2008, is a vocal critic of Israel, accusing it of crimes against humanity for its blockade of Gaza.

Falk, who is Jewish, was detained and turned back from Israel in 2008, forcing him to abort a planned mission to Gaza - a deportation denounced by U.N. Secretary-General Ban Ki-moon.

He reports to the U.N. Human Rights Council, whose June/July session was boycotted by Israel's delegation, which accuses the 47-member forum of bias. Its latest investigation into Israeli practices is into whether Jewish settlements in the Palestinian territories violate human rights law. (Reporting by Stephanie Nebehay; editing by Andrew Roche)