The case is being brought by the Human Rights Law Centre on behalf of 150 asylum seekers who were temporarily moved to Australia from Nauru for medical treatment.
When it was originally raised in May, the case argued that there was no Australian law which gave the government the power to facilitate offshore arrangements.
But the government, with the support of the opposition Labor party, hastily brought in such a law.
But the Centre's director of legal advocacy, Daniel Webb, says the case is still going ahead because there remain important and untested questions about the constitutionality offshore detention.
"We know that the parliament can make a law for detention of people in Australia, and that it can make a law for the removal of people from Australia. But it's quite a different proposition to make a law that allows the Commonwealth to be involved in the detention of innocent people indefinitely in third countries."