Prosecutors on Friday agreed to drop a charge of murder against Phillip Dunn, 60, when he pleaded guilty to the lesser charge of assisting an offender - saying he helped co-offender Darcy McNamara cover up Day's death.

Just two weeks ago, McNamara, 44, pleaded guilty to murder when prosecutors accepted a different version, where he "encouraged, assisted or directed Mr Dunn" to kill Mr Day.

At that hearing, prosecutor John Dickie said "we simply don't know" exactly what happened.

All they could say was Mr Day died when a weapon was used to inflict a 90mm long and 20mm deep stab wound in his neck on July 26, 2018, while he was near the foot of McNamara's bed at his Ryan Avenue home in Wangaratta.

Justice Michael Croucher told the Supreme Court on Friday that the law did allow Dunn to claim he only assisted McNamara in the murder, despite having the finger pointed at him as the main offender at McNamara's plea hearing.

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"This plea that has been entered is quite different from that in a fundamental way. This assumes that Mr McNamara is a murderer, for the purposes of Mr Dunn pleading guilty and saying that 'I've assisted the prevention of his apprehension knowing him to be guilty of murder'," he said.

"Perhaps for those who don't know the law or might find it a bit strange, it's at the discretion the Director (of Public Prosecutions) to charge as she sees fit, based on the evidence admissible in the particular case, which is different between Mr Dunn's case and different again in Mr McNamara's case."

Mr Dickie said prosecutors had spoken to Mr Day's family about resolving the case with pleas of guilty to two different versions of events.

"There is a degree of artificiality, or it may seem that way to others, in terms of how the matters have resolved. But the prosecution of course must prove things and must prove things to a certain standard," he said.

Mr Dickie said when it came to Dunn pleading guilty, Dunn admitted to impeding the police investigation by disposing of his shoes with blood on them at a friend's house, giving McNamara cleaning products for the bedroom, giving him shovels to potentially help bury's Mr Day's body, getting rid of a knife connected to the murder and "falsely stating to others that Mr Day might have been alive when he was deceased at the time".

Dunn's barrister Diana Price told the court that "it's agreed that he did those acts".

A plea hearing for Dunn will be held in the Supreme Court on October 16.