It's alleged in late January and early February 2020 koalas were found to be suffering malnutrition and dehydration and without intervention the population would have starved within two months.

When the intervention happened about 70 koalas were found to be dead or had to be euthanized after there were 227 found alive.

Hutchinson contractors faced a single charge of animal cruelty relating to clearing habitat which was likely to cause unreasonable pain and suffering to the koala population.

The maximum penalty for the charge was 600 penalty units which at the time amounted to a $99,132 maximum penalty.

Landowner James Troeth and Bryant's Forestry and Earth Moving each face 126 charges under the Wildlife Act, including 18 aggravated cruelty charges for causing fatal injuries.

Those charges carry a maximum penalty of more than $200,000 for a business and $90,000 or two years' jail for an individual.

Magistrate Nunzio La Rosa said Hutchinson contractors played a minor role in the clearing of stumps, had pleaded guilty at an early stage and both the company and Ken Hutchinson had a clean record after almost 40 years in business.

But, he added the company should have recognised the habitat for the koalas was being removed.

Hutchinson contractors was not convicted and fined $20,000.

Prosecutor Susanna Locke said in 2019 it was alleged Mr Troeth engaged Hutchinson contractors and Bryant's to clear vegetation so the land could be returned to pasture for sheep.

She said the property was almost entirely cleared and the allegation was that the clearing of vegetation was an act of cruelty to the koala population.

It's alleged there was not sufficient habitat to support the number of koalas present.

Ms Locke alleged Mr Troeth erected a 1.8m high fence around the property and that severely restricted the koala population being able to move.

The bluegum plantation was harvested in mid-2019 and Hutchinson was engaged by Mr Troeth to clear stumps in a specific area, with Bryant's responsible for the major extent of the work.

It was alleged Hutchinson's offending was committed between November 14, 2019, and Jan 7, 2020, and related to the use of an excavator.

Ms Locke alleged Mr Troeth told Hutchinson to pull out the stumps, but not touch koalas.

It was not alleged Hutchinson contractors caused the death or injuries of any koalas.

Lawyer Adrian Paull said his client Hutchinson contractors applied processes to ensure koalas were not disturbed and they were in no way responsible for the fence which went around the property.

He said the fence was highly problematic and restricted the koalas moving from the property.

Mr Paull said Ken Hutchinson was 58-years-old and wanted to resolve the case after his wife passed away 11 weeks ago.

Mr Hutchinson has since been involved in an accident and lost his driver's licence for drink driving.

The company has gone from six or seven employees back to one permanent employee and Mr Hutchinson had decided to no longer run his business, the court was told.

Mr Paull said that at no time did Hutchinson contractors staff see koalas stressed or harmed.

In submitting no conviction was not appropriate, Ms Locke said general deterrence was a major factor in sentencing, koalas were a protected species and were now classed as extinct in Queensland, New South Wales and the ACT.

"There's real gravity to the offending. It was a captive population and there was an almost complete removal of habitat," she said.

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