Some of New Zealand's most dangerous prisoners are in line for millions of dollars in compensation thanks to the Court of Appeal upholding and increasing an order to pay $130,000 to five inmates held illegally in solitary confinement.

The decision increases the chances of success of claims by the other 200 inmates held under the regime, unless the Crown wins any appeal to the Supreme Court.

The 200 have been awaiting the court's decision on a Crown appeal against the High Court's award last year of compensation to murderer Christopher Taunoa and four other inmates who were held illegally under the "behaviour management regime" for difficult prisoners at Auckland Prison, Paremoremo.

Taunoa is serving a life sentence. He, his fellow inmates and many more were kept in solitary confinement at Paremoremo for extended periods under a regime that denied them regular clothing and bedding changes and made them clean their cell floors, toilets and washbasins with one shared bucket of water and cloth.

The Court of Appeal yesterday upheld the payments, declaring the regime breached prison regulations and the Bill of Rights Act.

It awarded Taunoa another $10,000 on top of the $55,000 he was granted by the High Court.

Wellington lawyer Tony Ellis, who took the Taunoa case, has already lodged claims for 42 more former inmates and is planning a class action for about 160 more.

Based on the formula used in the Taunoa case, collectively they could be entitled to $4.5 million.

But whether any, including Taunoa, will actually get cash in the hand is complicated by the Prisoners' and Victims' Claims Act, passed by Parliament in June to let victims have first claim on any compensation awarded to inmates.

The law is retrospective and was passed because of the Taunoa case, though it expires in 2007.

Mr Ellis said yesterday it was "an appallingly nauseating piece of legislation" and he would challenge it before the United Nations Human Rights Committee, which could also award compensation to the inmates.