Teina Pora's compensation for unlawful imprisonment works out to be an hourly rate less than the minimum wage, a court has been told.
Mr Pora's lawyers were in the High Court in Wellington today, asking it to review the amount of money paid to him in compensation for the 19 and a half years he spent in jail after he was wrongfully convicted of raping and murdering Susan Burdett.
Mr Pora was convicted in 1994 and was again found guilty at a retrial in 2000, but the convictions were overturned in 2015.
The compensation paid to him was based on 1998 guidelines that award $100,000 a year for loss of liberty.
A retired High Court judge, Justice Rodney Hansen QC, had recommended the figure be adjusted for inflation but the government rejected that, leading to today's hearing.
One of Mr Pora's lawyers, Gerard McCoy QC, today said the Cabinet was wrong to refuse to address the effect of inflation on the compensation payout.
He said expert evidence showed $100,000 in 1994 would need to be $154,000 in 2016 to have the same purchasing power.
Cabinet's refusal to adjust for inflation was a new and further injustice towards Mr Pora, Mr McCoy said.
"The Cabinet decision made in good faith is not just ungenerous and niggardly, but in public law terms is both unlawful and unreasonable.
"Time corrodes the value of money much as rust does steel.
"Under the guidelines he has been massively short-changed."
Mr McCoy said Justice Hansen's decision suggested inflation-adjusted compensation because not doing so would be anomalous and unjust.
"And so it is".
He said Mr Pora was the worst victim of injustice in New Zealand's legal history, and the least compensated of all such people - when calculated on time spent behind bars.
Mr McCoy said Minister of Justice Amy Adams gave several reasons for not adjusting Mr Pora's compensation, including that it could be unfair to seven other claimants who had previously successfully sought compensation after being wrongly jailed.
He said the minister also said that the overall amount of compensation awarded was broadly consistent with the approach in other jurisdictions and she was "comfortable" with the outcome.
The Crown said there was limited scope for a court to review ex-gratia payments of the kind made to Mr Pora.
Crown lawyer Paul Rishworth QC told Justice Ellis the guidelines did not allow for that and while the Cabinet could have decided to make the adjustment, it did not.
He said given the Cabinet did not make the adjustment, the Court needed to decide what was the legal principle by which it was said to be wrong to not adjust inflation.
Justice Ellis said if the starting point was Justice Hansen's recommendation, that the figure be inflation-adjusted, and the reasons for not doing so had to be coherent and defensible.
Justice Ellis has reserved her decision.