Refugees and asylum seekers detained on Manus Island under Australia’s off-shore processing system will seek hundreds-of-thousands of dollars in compensation after Papua New Guinea’s Supreme Court found they were illegally imprisoned.

A lawyer representing the men on Manus Island has told SBS they will pursue the Australian government for compensation and that they should be returned to Christmas Island.

Five judges of the PNG Supreme Court ruled the detention of asylum seekers and refugees breached their right to personal liberty guaranteed in the country’s constitution.

The court ordered the PNG government take immediate steps to implement the decision and not breach the constitution further.

“My clients, there’s a big jubilation in the camp. Everyone is really happy, really happy,” Ben Lomai, the Port Moresby-based lawyer for refugees and asylum seekers on Manus Island, told SBS.

“In the next couple of days we will be putting an application to the Supreme Court; one is for them to be released and then that the matter be progressed for compensation.

“The National Court has already settled (in previous cases) for breach of personal liberty. For example, they’ve already ordered 200 kina per day (A$82) and 100 kina (A$41) for exemplary damages.”

Some detainees have been held on Manus Island for several years and Mr Lomai said they could be entitled to compensation of over A$100,000.

Around 850 men are still at the Manus Island processing centre, established by two memorandums of understanding between the Australian and PNG governments in 2012 and 2013.

About half are thought to have been given refugee status.

“Under the arrangement, the Australian government is obligated to pay costs, and that includes the cost of maintaining the offshore processing centre, including the wellbeing of the asylum seekers and in my opinion their legal costings, including compensation claims,” Mr Lomai said.

“If we get the compensation claim, we’ll be seeking an order to enforce that against the Australian government.”

Australian immigration minister Peter Dutton in a press statement after the Supreme Court decision said, “Australia was not a party to the legal proceedings”.

“It does not alter Australia’s border protection policies – they remain unchanged.”

The successful case was brought by former PNG opposition leader Belden Namah, one of two challenging the legality of the Manus detention centre.

“Section 42 of PNG’s constitution, it guarantees freedom of persons entering the country, including foreigners, unless the foreigner has broken some law of this country, then they will be subjected to detention or placed in custody,” said Mr Namah’s lawyer Loani Henao.

"I’ve been advised from tomorrow the centre will be open, meaning it will no longer be a detention centre."

“The asylum seekers that have come in here are not here of their own volition, but at the Australia and PNG governments’ own arrangement.

“They brought the asylum seekers into the country against their will and so have not broken any Papua New Guinea law, yet they were they were kept in custody in the detention centre and that breaches section 42 of our constitution.”

A parallel Supreme Court case by Mr Lomai representing the refugees and asylum seekers will now be discontinued.

For how long the Manus detainees will remain in PNG is unclear.

“Where the asylum seekers come from, they have to go back to that place. The first port of entry, meaning they have to go back to Christmas Island,” said Mr Lomai.

“Those already given the status of refugee, maybe the Australian government can integrate them into the community, because they have been duly processed by Australian officials. They can respect their own process.”

Mr Dutton in a statement said: “People who have attempted to come illegally by boat and are now in the Manus facility will not be settled in Australia.”

“Those in the Manus Island Regional Processing Centre found to be refugees are able to resettle in Papua New Guinea. Those found not to be refugees should return to their country of origin.”

Until their future is decided, the Manus Island detainees will be free to leave the detention facility but it is unclear if they can leave the remote island.

“I’ve been advised from tomorrow the centre will be open, meaning it will no longer be a detention centre, it will be that the asylum seekers and refugees will be allowed on move in and out freely,” Mr Lomai said.

“I think administratively they’ve put that in place, they (PNG government) probably anticipated the judgement will be against them.”