A compensation deal from the Australian Government worth $70 million for 1,300 current and former detainees on Manus Island has been approved by Victoria's Supreme Court.

The group of asylum seekers and refugees were compensated for being illegally detained between 2012 and 2016, and for negligence in how the Government housed and protected them.

The deal is the largest human rights settlement in Australian legal history.

The agreement was reached out of court in June just as a trial against the Commonwealth and security companies Transfield and G4S was due to start.

The group alleged the Commonwealth breached its duty of care by holding them in conditions that did not meet Australian standards.

During the period of their incarceration there was also a riot that resulted in the death of an asylum seeker and serious injuries to other detainees.

They also said they were falsely imprisoned after Papua New Guinea's Supreme Court ruled their detention was illegal.

Of the 1,923 detainees who were eligible for compensation, 1,383 have registered to be part of it.

Some of those who have not registered are yet to be contacted or are still in negotiations to join, but 56 have opted out.

Justice Cameron Macauley said the compensation would allow lawyers to allocate money to reflect each applicant's personal circumstances.

"I am comfortably satisfied that the amount of $70 million amongst participants is a fair and reasonable sum," Justice Macauley said.

"This is reached with a strong degree of conviction."

Asylum seekers 'denied refuge and protection'

The Federal Government wants to close the Manus Island centre by the end of October. About 800 people — all men — remain on the island.

Slater and Gordon, which led the legal action, said it hoped the detainees would get their money before the closure.

"These people came here seeking refuge and protection, this was denied by successive Commonwealth governments. Today, they achieved a medium of justice," lawyer Rory Walsh said outside court.

"[We wanted] to put an end to this fiction the Commonwealth seeks to maintain for political purposes that it's PNG [that] holds these people, that PNG has the duty of care for these people.

"The Commonwealth settled this case and paid $70 million not to have that fiction tested in court."

The Federal Government has not responded today, but previously said the case was settled because it was a more prudent option than proceeding with an anticipated six-month trial, which was expected to cost tens of millions of dollars in legal fees.

Money won't stop the suffering, Manus detainee says

One of those eligible to receive the compensation, Iranian refugee Amir Taghinia, isn't happy with the deal.

The 24-year-old is one of 56 detainees who've decided to opt out of the payment.

He told AM the money will do nothing to get him and 800 others off Manus Island.

"Getting that money is not the issue. It is not the matter of the amount of money, it is not a matter of the lesser of two evils or something better than nothing," he said.

"We are still in the same situation, we are still suffering from the same conditions, under the cruel regime of the defendant, and the case is finished, the case says 'yeah, that's it, it is already settled'."

"It is absolutely not in favour of any of the detainees in here, but it is in favour of the law firm and the defendant."

Andrew Baker from Slater and Gordon said most of the detainees were happy with the outcome.

"It's rare in any class action to have a completely uniform response across the entire group," he said.

"So if people are feeling like a better outcome would have been something else, or feel like something different should have occurred, we certainly respect that."

Mr Baker rejected claims from some detainees that the law firm pursued the case for self-promotion or for money.