Deputy State Coroner Iain West said on Thursday he believed Linda had been murdered and accepted evidence presented at an inquest that Percy was seen in St Kilda on the August 10, 1968, the day Linda went missing.

"I find that Derek Percy caused the death of Linda Jane Stilwell," Mr West told the court.

Mr West said the former Warrnambool resident had the capacity to "commit a heinous act", as his abduction and killing of Yvonne Tuohy demonstrated.

Percy was in custody since July 1969 when he was arrested over the death of Yvonne, 12, up until his death from lung cancer in 2013, aged 64.

He was found not guilty of Yvonne's murder by way of insanity but remained in custody at his governor's pleasure.

Mr West said he was satisfied descriptions of a man seen loitering where Linda was last seen was consistent with Percy's appearance at the time.

A description of a car seen in the area at the time was also consistent with the one Percy drove, the coroner said.

Linda's mother, Jean Priest, and Linda's brother, Gary Stilwell, embraced after the findings were handed down.

Outside court, Mr Stilwell described the finding as the outcome he and his family were hoping for.

"We're thankful to the coroner and the work that's been done by the police and our legal team to bring this to a conclusion," he said.

"It's now been proved that Derek Percy preyed on Linda and other innocent children, and thank God he's passed away and he's not here to inflict any more emotional and physical pain on us."

Ms Priest said she still hoped her daughter's remains would be one day found.

"We just hope that eventually someone will find her remains so that we can give her a decent funeral and show her the respect she deserved rather than how it's been left," she said.

"But this has just been marvellous today ... This is a form of closure. I would have liked to have got the full answers but it doesn't look as if we'll ever get them."

Percy denied any involvement in Linda's abduction and her family had to take legal action to ensure he was questioned by a coroner. He was questioned in 2013 by Mr West.

The coroner also on Thursday commended the "amazing" work of Detective Senior Sergeant Wayne Newman, who first reviewed the case in 2004 and established similarities between the abductions of Linda and Yvonne, and identified Percy as the prime suspect.

As well as the deaths of Linda and Yvonne, Percy has been linked to the deaths or disappearances of seven other children across Australia.

They are: friends Christine Sharrock and Marianne Schmidt, both 15, who were murdered on a Sydney beach in January 1965; the Beaumont children – Jane, 9, Arnna, 7, and Grant, 4 – who disappeared in Adelaide on Australia Day in 1966; Allen Redston, 6, who was abducted and killed in a Canberra suburb in September 1966; and Simon Brook, 3, who was killed in Sydney in May 1968.