Accused killer Christopher David Navin is entitled to fight a murder charge on the grounds of mental impairment, an expert says.
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Dr Stephen Allnutt told the ACT Supreme Court he believed Mr Navin had suffered from a psychosis "of some severity" when he allegedly murdered his former housemate on Boxing Day 2013.
Mr Navin, 29, has pleaded not guilty by way of mental impairment to murdering Nicholas Sofer-Schreiber.
His Supreme Court murder trial entered its 13th day on Wednesday.
Mr Sofer-Schreiber suffered 73 stab wounds on the night of Boxing Day in 2013. He bled to death after the knife severed major arteries in his neck.
Mr Navin then drove to family property near Grafton, in northern NSW, where he allegedly burnt evidence.
Friends found Mr Sofer-Schreiber dead in his Lyneham home on the afternoon of December 28.
The prosecution alleges a soured friendship was Mr Navin's motive for the killing.
But Dr Allnutt on Wednesday said the scenario had been possible, but not probable.
The court has previously heard Mr Navin, upon his incarceration after his arrest in February 2014, reported he believed he had been watched by "observers", had heard voices, and thought his mind could be read in the months before the attack.
He attributed his grandfather's 2013 death to Mr Sofer-Schreiber, who he believed worked with the observers.
"It was me or him. [The] only way to stop him was to kill him," Mr Navin told Dr Allnutt during an examination at the jail.
The forensic psychiatrist on Wednesday said Mr Navin had been psychotic and incorporated Mr Sofer-Schreiber into his delusional belief system.
Dr Allnutt said the accused's ability to reason had been contaminated by that belief, so he thought himself morally justified to kill Mr Sofer-Schreiber in a pre-emptive strike to protect himself and his family.
The trial continues before Justice John Burns on Thursday.
