The Ministry of Justice said it recognised there were problems in the system, adding that the justice secretary had asked the Parole Board to look urgently at how IPP offenders were handled.
He added that the justices' move on Thursday suggests "the court wasn't yet satisfied with either party's position".
It added that the justice's wife, Virginia Lamp Thomas, had solicited resumes "for transition purposes" from government oversight committees of Congress.
"I've never been in favour of mollycoddling criminals," Clarke said, before adding that the criminal justice system really had to do better than that.
In October, a judge threw out the murder conviction of Susan Mellen, saying that she was wrongfully imprisoned for 17 years based on the word of a habitual liar and adding that "the criminal justice system failed".
The pending Supreme Court case was irrelevant to its determination, the appeals court said, adding that if the justices had a different view of the matter, they should say so.
Cormac Smith, head of communications at Basildon council, said the council was assessing how many people living on the legal site were not entitled to be there, adding that the "wheels of justice" had been put into action.
Of the subsequent acquittal, she added: "That is justice being done and we respect the chief magistrate's decision".
"Congress itself has the power to decide what policies and programs it will promote," Alan Levine, a lawyer for the corporation, told the justices, adding that the limitation "made perfect sense" for a Congress that wanted to keep federally financed lawyers from challenging the substantial changes brought about by the 1996 welfare law.
