A NSW coronial inquiry has accepted the evidence of the mother of a teenager who died under strange circumstances in 1987 that Bourke was divided and "racist" during the time.

The inquiry into the deaths of two Bourke cousins in 1987 has found there were 'serious failings' by police during the initial investigation – including a failure to take crucial evidence from the girl's families

36 years ago the bodies of Mona Lisa Smith, 16, a Murrawarri and Kunja girl, and Jacinta Rose "Cindy" Smith, 15, a Wangkumara girl, were found at the site of a car crash 50 kilometres outside of Bourke on December 6 1987.

40-year-old excavator Alexander Grant was also in the car at the time, but he had only minor injuries.

Evidence at the time suggested that Mr Grant had provided the girls with alcohol before they went into car.

Mr Grant was subsequently charged with indecently interfering with Cindy's corpse and culpable driving - and his matter went to trial.

However, an all-white jury found him not guilty after his defence team argued that Mona was driving Mr Grant's ute when it crashed. This despite Mona’s family telling investigators that she did not know how to drive a manual. 

The charge of sexual interference was withdrawn by prosecutors due to a technicality, without the family's knowledge.

June and Fiona Smith at the site of the girls deaths in Bourke. Image: The Australian.

Mr Grant died in 2018.

After a long-waited inquest was held in December, state coroner Teresa O’Sullivan delivered her findings in the Bourke courthouse on Tuesday and said in the days that followed, police conducted a "wholly and ... inexplicably deficient" investigation that failed to result in any charges.

"This inquest - held because of the unrelenting advocacy of Mona and Cindy’s families - was their final hope to obtain answers about the circumstances of the deaths of their beloved girls," wrote O'Sullivan in her findings.

"[Their] concerns ... were entirely vindicated by the evidence received in this inquest [but] those concerns were repeatedly dismissed."

Other former police investigators testified that the investigation was “a nightmare”, “shoddy” and “unprofessional.’’

In her 87 page report, Ms O'Sullivan also said that racism was a significant factor in the failings of the initial police investigation saying that if “two white teenage girls died in the same circumstances” she could not conceive of there being “such a manifestly deficient police investigation”.

Mona Lisa's sister and mother, Fiona Smith and June Smith, as well Dawn's relative Kerrie Smith and Dawn's mother Cindy Image: The Australian.

She accepted the conclusions of an earlier report by Professor Chris Cunneen states that by 1986, there was a “state of tension between police and Aboriginal people in Bourke” and that racial dynamics impacted on policing attitudes and communication with Aboriginal people in the 1980s”

Mona’s mother Dawn Smith’s told the inquest: “There were a lot of racist white people in town in the 80s, so we would keep to ourselves. The Aboriginal people all lived on one end of town, near The Reserve and Adelaide St, and the white people all lived up the other end”.

Ms O’Sullivan concluded that the evidence had not been taken from the girl’s families as the police had failed to hold adequate meetings with them after the deaths.

She said their families had been vindicated in pressing for answers despite being repeatedly pushed back.

Ms O’Sullivan recommended that “the Commissioner of the NSW Police Force develop guidelines for the review of investigations relating to deaths that are the subject of a request for advice from the NSW Attorney General to the Commissioner of the NSW Police Force”