Gerard Caleo cleared of involvement in sister-in-law's murder due to lack of evidence

Gerard Caleo emerged from court with half a smile on his face, the realisation he was no longer an accused killer still sinking in.

The 45-year-old was charged with murdering his brother’s first wife Rita Caleo who was stabbed to death in 1990, accused of driving the hit man Alani Afu to her Double Bay home.

But a magistrate today found there was not enough evidence to take the case any further.

Mr Caleo told 9NEWS “it’s a bittersweet day, I should never have been here from the beginning”.

“I am thankful that now it’s over I can try and get back on with my life.”

However it was a different story for his brother Mark Caleo, who was ordered to stand trial in the Supreme Court for Ms Caleo's murder and the murder of her brother a year earlier.

Dr Michael Chye was shot dead as he drove his Mercedes into the garage of his luxury Woollahra home in 1989.

The pair had been at odds over a $3.6 million property at Blakehurst.

Police allege Ms Caleo was killed because she was about to talk to officers about her suspicion her husband was involved in her brother’s death.

Outside court today Mark Caleo described that as “nonsense” and said “once the evidence comes out it’ll all be clear”.

He’ll return to court in May along with Afu.