Philippines-born Vivian Alvarez Solon, who has two children living in Australia, was deported to her country of birth in 2001 and spent four years living in a hospice for the dying before she was found a year ago.
Immigration officials, under fire for a series of bungles which also saw an Australian resident wrongly jailed and detained for 10 months, incorrectly assumed Solon was an illegal immigrant.
At the time she had recently been injured in a car accident and had several medical problems. The 44-year-old suffers from partial paralysis and is in need of constant care.
A lawyer for the woman, George Newhouse, told the Sydney Morning Herald that speculation Solons negligence claim against the Australian government would amount to Aus$10 million in compensation was "understated."
"One can never be certain in any litigation, but as Vivians case has proceeded, the commonwealths conduct has looked increasingly shabby and the quantum of her damages has become clearer," Newhouse said.