Suzanne Armstrong and Susan Bartlett were found stabbed to death in a suburban home in 1977. Photo: HANDOUT/Public Record Office Victoria (PROV), AAP

A neighbour has recalled how a toddler clung to her "like a little koala bear" before his mother and her housemate were found dead nearby.

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Janet Powell described finding her neighbours' lifeless bodies nearly 50 years ago as the man accused of killing Suzanne Armstrong, 28, and Susan Bartlett, 27, faced Melbourne Magistrates Court.

She first noticed something was awry two days earlier, on January 11, 1977, when a dog stumbled into her

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