  We present a computational study of the layered copper oxychloride
[CuCl]LaNb(2)O(7) that has been recently proposed as a spin-1/2 frustrated
square lattice compound. Our results evidence an orbitally degenerate ground
state for the reported tetragonal crystal structure and reveal a
Jahn-Teller-type structural distortion. This distortion heavily changes the
local environment of copper -- CuO(2)Cl(2) plaquettes are formed instead of
CuO(2)Cl(4) octahedra -- and restores the single-orbital scenario typical for
copper oxides and oxyhalides. The calculated distortion is consistent with the
available diffraction data and the experimental results on the electric field
gradients for the Cu and Cl sites. The band structure suggests a complex
three-dimensional spin model with the interactions up to the fourth neighbors.
Despite the layered structure of (CuCl)LaNb(2)O(7), the spin system has
pronounced one-dimensional features. Yet, sizable interchain interactions lead
to the strong frustration and likely cause the spin-gap behavior. Computational
estimates of individual exchange couplings are in qualitative agreement with
the experimental data.
