Compensation for prisoners held longer than they should have been should not be calculated under Cabinet's wrongful conviction guidelines, a lawyer for Corrections has argued.
The department is trying to overturn a High Court decision that it must pay compensation to prisoners whose release date was miscalculated after the Supreme Court found Shane Gardiner had been held 30 days longer that he should have.
In its judgement, the Court set a new formula for calculating prisoner release dates.
Gardiner was awarded $10,000 compensation, but Corrections' lawyer Daniel Perkins told the Court of Appeal today it should not be paid.
He said part of the Supreme Court's decision should be read retrospectively as applying to those already in prison, but the part relating to compensation for people wrongly held should only apply in future.
"We accept prisoners detained at the time who were sentenced and had their sentences [mis]calculated were entitled to benefit from that decision retrospectively."
"But whether it is retrospective for civil liability was left open by the Supreme Court, and it falls to this Court to [decide on that]."
Mr Perkins said Corrections' position was that it was not liable for those held in prison for too long because in setting release dates it was acting in good faith according to what it understood the law to be at that time.
He said the Cabinet guidelines only related to cases of wrongful conviction and imprisonment, which was not the situation in the current case.
Mr Perkins also said the consequences of being held in prison for an extra month would be quite different to those for someone who was held for months, or even years longer than they should have been.
He suggested that the effects of being held for too long would be less for someone who had been in prison several times before, than those experienced by someone who had never been behind bars before.
Gardiner's lawyer Douglas Ewen said the Supreme Court could not have intended its judgment to be applied retrospectively in some matters and only for future cases in others.
"It is not right to say the Supreme Court took two bites of the cherry."
"It was sufficiently concerned about this problem to give the Crown time to go away and look at what other matters it might raise."
Mr Ewen said it was incorrect to say that someone like Mr Gardiner might not be so badly affected by being jailed for too long, as he had spent plenty of time in prison.
He said an individualised assessment would be needed to establish what the effects might be and Mr Gardiner might have to give evidence about that.
"The [main] consequence for him was the loss of his time."
The Court has reserved its decision.