The latest twist came as Prime Minister Scott Morrison and Finance Minister Mathias Cormann urged Mr Palmer to drop his challenge of WA's border closures.

Premier Mark McGowan went a step further on Friday, saying WA would continue to fight the billionaire regardless of the Federal Court outcome.

"With or without the support of the commonwealth government, WA will keep fighting for what is our right and that is to protect the citizens of our state," he told reporters.

"We're in a war with Clive Palmer and it's a war we intend to win."

The matter returned to the Federal Court on Friday for a case management hearing sought by the WA government.

WA is arguing the case should be vacated and a new trial of the issues convened after the federal government withdrew its support for Mr Palmer's position.

But the Commonwealth has declined to submit whether its evidence should be struck out on the basis that it is no longer involved in the matter.

Mr McGowan said it would have been far more preferable if the Commonwealth had actively supported WA's position.

"We believe a fresh trial is the only way forward," he said.

The prime minister said he had an "outstanding relationship" with WA's premier and backed calls for Mr Palmer to abandon the proceedings.

"He's the only one who can prevent that case from going forward and I think that would be a good decision," Mr Morrison told reporters.

"We do and have provided support for the outcomes that the Western Australian government is seeking to achieve."

Mr Cormann earlier appealed to Mr Palmer to reconsider his position in light of recent outbreaks in the eastern states.

"These borders are very important for the people of Western Australia," he said.

The prime minister has said the Commonwealth withdrew from the matter to spare West Australians unnecessary anxiety.

He added that it was nothing to do with a potential electoral backlash for WA Liberal MPs.

WA Solicitor-General Joshua Thomson SC told Friday's hearing that retaining the Commonwealth's expert testimony despite its withdrawal would disadvantage the state.

But Mr Palmer's barrister Peter Dunning said the evidence could not simply be disregarded even if a new trial was called.

Justice Darryl Rangiah has reserved his decision.

Mr Palmer, who was denied an exemption to WA's hard border closures, is challenging the restrictions on the basis they are unconstitutional.

A ruling had been expected in the High Court in October after a four-day hearing concluded in the Federal Court last week.

That is almost certain to be delayed if a new trial of issues is ordered.

Australian Associated Press