Debra Campbell was just 21 years old when she disappeared from her home in Melbourne's inner southeast on February 25, 1984.
Her body has never been found but a coroner in 1998 declared she was most likely dead.
Debra Campbell was 21 when she disappeared from her Melbourne home in 1984.
Police last month charged her former fiance Peter John Wetzler, 65, with her murder.
The NSW man faced the Victorian Supreme Court on Wednesday, where his lawyer argued he should be released on bail because the case against him was weak.
Barrister Manny Conditsis said the so-called motive against his client was "nonsense" as it centred around an argument he had with Ms Campbell and an alleged affair.
Police claim Wetzler was having a sexual relationship with another woman at the time of Ms Campbell's disappearance, but the 65-year-old said the relationship happened years earlier.
He also admitted having an argument with Ms Campbell before her disappearance but Mr Conditsis said there was no evidence he was ever violent.
"Your Honour, that's as good as it gets for the police," the lawyer told the court.
The police had no evidence to charge Wetzler as of January this year so they started a covert investigation with listening devices, Mr Conditsis said.
Those recordings showed him "rehearsing" what he would tell police but the lawyer said there was nothing sinister about it.
"It's desperate police trying to find something for this man to be charged of a heinous crime of the murder," Mr Conditsis said.
Prosecutor Kristie Churchill admitted it was not her submission that it was a strong prosecution case.
"Perhaps I'll say no more than that," she told the court.
Justice John Champion agreed the prosecution's case "does not appear to be particularly strong or compelling".
He noted the nearly 40 years it's taken for charges to be laid, saying it was likely it could be another two years before the case went to trial.
Wetzler also had no prior criminal convictions and he vehemently denied murdering Ms Campbell, Justice Champion said.
He granted Wetzler bail on the condition he reside at his home in Cardiff South near Newcastle, he reports to the police station once a week and he returns to Victoria for any court hearings.
Mr Conditsis said the Wetzler family was very pleased at the result of Wednesday's hearing.
"The court recognised that the prosecution case presented against Mr Wetzler so far is not strong," he told reporters outside of court.
"The Wetzler family is confident that justice will prevail."
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