A friend and neighbour of mother-of-two Lynette Dawson claims she knew her husband, who is accused of murdering her, was having sex with their babysitter.

Giving evidence in the NSW Supreme Court on Monday, Julie Andrew said Ms Dawson had told her the babysitter, JC, who had been a student at the school where her husband was teaching, was moving into the family home permanently.

Ms Andrew, the first witness called in the judge-alone trial, said she initially heard a “loud, crying wailing” coming from the Dawsons’ Bayview, Sydney, home in late 1981 and walked over to the property where she saw Ms Dawson backed up against the trampoline with Chris Dawson towering over her.

She described Mr Dawson as being a huge man who was screaming at his crying wife.

Ms Andrew said she thought Ms Dawson said something like “what are you doing to us Chris?” as he roared at her.

She later went back to check on Ms Dawson, who was upset JC was moving into the house.

Ms Andrew said she told Ms Dawson: “It’s your house, you can’t let her move in. He’s f—ing the babysitter.”

Having first noticed JC around the house in late 1980, Ms Andrew described her as a “vulnerable teenager” who was often topless at the pool.

She remembered times when JC would walk down the side of the house topless and would think: “My God, that doesn’t look too good. She’s 16, she’s his student, she’s topless”.

Asked by crown prosecutor Craig Everson SC what Ms Dawson said when told her husband was having sex with the babysitter, Ms Andrew replied: “She accepted what I was saying was true.

“She’d known it.

“She was deluding herself into thinking things could go back to the way they were between her and Chris.”

Lynette Dawson vanished in 1982. Photo: AAP

Ms Andrew said Ms Dawson had had such a difficult time giving birth to her two daughters that she would never have abandoned them.

She denied claims by defence barrister Pauline David that she had come to court to paint Mr Dawson in the most monstrous way she could.

Mr Dawson, 73, a former Newtown Jets rugby league player, has pleaded not guilty to murdering his wife in January 1982.

The crown case is that he killed his wife and disposed of her body because of his affair with JC.

In her opening address to the court on Monday, Ms David said Mr Dawson might have failed his wife as a husband, but he did not kill her.

Mr Dawson arranged for a notice to be published in the local newspaper a day after the couple’s wedding anniversary on March 27, 1982, which read: “Lyn, I love you. We all miss you. Please ring. We want you home”.

Ms David said the police investigation into Ms Dawson’s disappearance had been flawed and they had failed to follow up alleged phone calls from her and sightings of her after she had supposedly been murdered.

The trial before Justice Ian Harrison continues.

– AAP