Have youy tried truning on then off Time Zone support?
In iCal v4.0.4 under OSX.6.8 that can be found under iCal > Preferences > Advanced
You could also try quitting iCal, moving your plist file ~/Library/Preferences/com.apple.iCal.plist to the Desktop and then reopening iCal. This will force iCal to create a brand new clean com.apple.iCal.plist file.
If the problem has gone away then it lay within a your probably corrupted plist file so you can move the file from the Desktop to Trash - but you will have to recreate your other iCal user preferences via iCal's Preference panel.
If, however, the problem remians then it isn't your plist that is at fault so you can return the com.apple.iCal.plist file back from the Desktop into ~/Libray/Preferences and overwriting the new version which will be there.
Other than that, I'm stumped!