Witnesses testify in Bob Day hearing

Retired senator Bob Day asked his ex-business partner if he could put a property under his wife's name so it wouldn't be a "conflict", a court has heard.

The evidence emerged in a pre trial hearing in the High Court, sitting as the Court of Disputed Returns, for the former Family First senator.

The court is taking the unusual step of hearing from witnesses before the full bench considers next month whether Mr Day was ineligible for election.

At issue is whether Mr Day was incapable to be elected at last year's poll, due to a pecuniary interest in the lease of a property at 77 Fullerton Road, Kent Town, SA, which was partly used as his electorate office.

Mr Day's former business partner, John Smith, testified on Monday that Mr Day asked if he could put the property in the name of his wife, Deb.

Mr Day said it was because he wasn't allowed to receive Commonwealth lease payments if it remained in his name.

"He said there'd be a conflict," Mr Smith said, and that if Mr Day put it his own wife's name it was still "too close".

"I said as long as I don't have to do anything, as long as it doesn't cost me anything, I'm happy," Mr Smith said.

"Bob said he'd take care of everything and that was basically it."

Deb Smith told court her husband came to her two years ago and said Mr Day wanted to put the property into her name.

She said she didn't read the documents to transfer the ownership and "just signed it where it was marked".

"I certainly wouldn't have pored over them, I've never done that," she said.

Mrs Smith said she didn't realise she was being made a director of a new company called Fullerton Investments, believing she was simply the owner.

Mr Day denies having a direct or indirect pecuniary interest in the lease, executed about 1 December, 2015, between Fullarton Investments and the Commonwealth.

Former Labor senator Anne McEwen, who lost her seat at the 2016 election, is a party to the case, along with Mr Day and the Commonwealth attorney-general.

The case continues on Tuesday.