There were tears of joy from Mrs Lowe and her family as magistrate Timothy Walsh announced he was entering a finding of not guilty and dismissing all charges after the prosecution announced it was seeking to withdraw the case.

EDITORIAL: Lowe's vindication after tough journey

The withdrawal part-way through day three of a planned four-week contested hearing ended a saga that dates back to a police inquiry that began in September 2009 and which has been dragging through the courts since August 2011.

Mrs Lowe, 39, and Mr Lowe, 41, faced 343 and 276 charges respectively over alleged misappropriation of funds during their time working at Worn Gundidj Aboriginal Co-op.

The prosecution’s capitulation came in the middle of the cross-examination of its first witness out of an intended 31 witnesses, co-op manager Shannon Collyer.

Mr Collyer was believed to be the star witness for the prosecution, having been the person responsible for auditing the co-op’s books and bringing many of the allegations to police attention.

But yesterday his own credibility was called into question, following accusations made in court by defence lawyer Damian Sheales which suggested Mr Collyer had allegedly received benefits or borrowed funds from the co-op that he wasn’t entitled to.

Magistrate Timothy Walsh gave Mr Collyer time to get legal advice before allowing the cross-examination to continue.

During an uncomfortable stint on the witness stand, Mr Collyer was also forced to retract previous statements he’d made to police and the court which were found to be untrue and to explain why he had pursued allegations against the Lowes, yet not followed up a $700 purchase of luggage using Worn Gudidj money by his own father and former co-op director, the late John Collyer. 

Shannon Collyer had initially accused Mrs Lowe of buying the luggage, but was forced to retract the allegation when he discovered his dad bought it.

This followed the previous day’s revelation that John Collyer had paid his own consultancy business $43,000 of Worn Gundidj money and that Shannon Collyer was affiliated with the business, but Shannon Collyer had not sought to investigate that payment, instead focusing on the Lowes.

In the midst of Shannon Collyer being cross-examined, Mr Walsh declared Worn Gundidj to be “one of the most shambolic organisations” he’d come across, saying it seemed to have an anything-goes policy for everyone except the Lowes.

With no accountant or auditor planned to be called by the prosecution, Mr Sheales questioned Mr Collyer’s credentials to conduct the audit that had led to the charges being laid against the Lowes.

Mr Collyer conceded he was not an accountant and had no idea how the finances worked at the co-op.

Only one step in the legal process remains — the matter will return to court on June 10 with the Lowes seeking to recoup the costs they had spent on fighting the prosecution’s ultimately unsuccessful case.

Mr Sheales said his clients had spent in the vicinity of $300,000 attempting to clear their names.

“This nearly ruined them,” he said.

“They would have lost their house — they are nearly financially broke as a result of this case. A massive amount of money is going to be sought.”

The 600-plus charges related to the alleged misappropriation of about $20,000. It is understood that prosecuting the matter has already cost around 10 times that amount. Mr Sheales, who had called the prosecution case “sloppy”and “a joke”, said he was not surprised the case collapsed.

“(That) anyone could prosecute this case the way they have is a disgrace and an embarrassment to the administration of justice,” he said. In his opening statement on Monday, Mr Sheales called the case “a witch hunt”.