A foreign haulage company has asked the Court of Appeal to "reflect the sobering reality" of the worsening migrant crisis at Calais and quash fines imposed after three men stowed away on a vehicle.
Romanian-based ICS Car SRL and one of its drivers, Fanel Toia, are seeking a declaration that the Home Secretary is operating a legally-flawed system of penalising hauliers in her bid to stem the flow of clandestine entrants to the UK.
Parminder Saini, appearing for both appellants, argued Theresa May was applying her code of practice "too stringently without sense of pragmatism".
It is believed to be the first case of its kind to reach the courts.
An HGV vehicle - operated by ICS Car and driven by Mr Toia - was searched by authorised search officers in the UK immigration control zone in Calais on May 14 2013.
Three Afghan nationals were discovered hidden among a load of copper wiring after making a slit in the soft roof of the trailer unit.
The driver said he had performed all the necessary checks required of him, but at some point the Afghans had dropped down on to the vehicle from overhanging branches or a bridge near Calais and cut the hole in the fabric of the roof.
The Home Secretary imposed civil penalties of £900 on the company and £600 on the driver for breaching rules requiring them to ensure the vehicle was secure to stop "clandestine entrants" reaching the UK.
Under the rules, the authorities can issue an on-the-spot penalty of up to £2,000 for every stowaway discovered.
ICS Car has paid out a total of more than £3,000 since the scheme began.
Appeals to the Central London County Court were rejected by Judge Bailey in October 2014.
On Wednesday, Mr Saini asked the Court of Appeal to rule the judge had applied the wrong legal test for "clandestine entrants" using her powers under the Immigration and Asylum Act 1999.
Mr Saini also argued both company and driver had done all that was reasonably possible, given the difficult and dangerous circumstances at Calais, to check that migrants had not stowed away.
He asked the judges urgently to deliver a judgment "that reflects the sobering reality that drivers and hauliers face, particularly in the light of the worsening Calais crisis."
But Toby Riley-Smith QC, appearing for the Government, argued that the county court judge's decision was "unimpeachable" and the Home Secretary had acted within her powers.
The QC said: "If effective and proper checks had been applied the slit in the roof would have been observed."
Appeal judge Lady Justice Gloster, sitting with Lady Justice King and Lord Justice Simon, said the court would take time to consider its decision and give judgment at a later date.
On Thursday, the appeal court will hear another case in which a Dutch company is appealing against a fine of £7,200.
The spotlight fell on the sanctions last summer as migrants made thousands of attempts to cross to Britain from Calais.
Figures showed the number of fines issued to hauliers more than tripled over three years, reaching more than 3,000 in 2014/15.
Last week, it was revealed ministers are considering extending the regime to rail operators.
A Home Office spokesman said: "It is in all our interests to combat attempts to enter the UK illegally, which can damage the haulage industry financially and place the safety of drivers at risk.
"That is why we have invested tens of millions of pounds to reinforce security at our controls in northern France.
"The civil penalty regime is an important part of our wider response to tackle illegal immigration and exists to ensure that all drivers are taking reasonable measures to stop migrants from boarding their lorries.
"We are currently consulting on proposals to modernise the regime to reflect developments in both the technology available to hauliers and operators, and the tactics used by migrants."