Antony Waterlow stabbed his father and sister to death in the throes of aschizophrenic episode after psychiatrists failed to detain him.
But since subsequent detention and treatment in a forensic hospital, Waterlow now understands what he did and has woken up from a living nightmare to a "worse nightmare", his friends say.
Had he been detained before, the deaths of his father, Nick Waterlow, an art curator, and his sister, Chloe Heuston, might never have happened, Glebe Coroners Court was told on Friday.
But Waterlow's psychiatrists believed that he could not be scheduled under the terms of the Mental Health Act.
As a result, Deputy State Coroner Paul MacMahon has recommended that the state government change the legislation to remove the ambiguity surrounding the decision of when to detain a mentally ill person against their will.
The inquest held last February was told that Waterlow's family had been trying for years to seek help for him, but were told that he could not be treated unless he checked himself into a hospital or harmed someone.
Psychiatrists believed that he could not be scheduled unless he posed an obvious and immediate threat, "even though it was apparent that his psychosis was becoming more pronounced and his quality of life, and that of his family and friends was being seriously affected", Mr MacMahon said.
Waterlow also had the ability to "hide the true extent of his illness", the coroner found, often appearing "pleasant, appropriate and cooperative" during assessments.
"The contrast between that behaviour and his behaviour towards family and friends at the time is stark," Mr MacMahon said.
He made four recommendations to the Minister of Health, which included amending the legislation to take into account the protection of others from "serious emotional harm" when deciding whether to schedule a patient.
When determining whether to schedule a mentally ill patient, the term "for the person's own protection from serious harm" should also be understood to include the harm caused by the mental illness itself, he said.
Nick Waterlow's partner, Juliet Darling, told the inquest that they had both lived in fear of Antony Waterlow, who had a "hair-trigger rage" and at times "just went berserk".
She said she once hid kitchen knives in a garden because she feared that he would become violent during lunch.
Nick Waterlow's other son, Luke, told the inquest that the family had been in fear of his brother for years and finally the "worst-case scenario" happened.
The death of Mr Waterlow and Ms Heuston was the result of a "love story" that, "like so many love stories, ends in tragedy", the coroner said.
They invited him to dinner at Randwick in the hopes of re-establishing family harmony.
"Due to their love and concern for him, Nick and Chloe were unknowingly placing themselves in a very dangerous position," Mr MacMahon said.
Waterlow was found not guilty of their murders by reason of mental illness in a judge-alone Supreme Court trial in 2011.
Gaye Bell, his friend and carer who regularly visits him in the forensic hospital where he was detained, said Waterlow struggles every day with what he did.
"I describe it as you're living a nightmare and you wake up and you're living a worse nightmare," Ms Bell told reporters.
"He now has to cope with what he's done."
Ms Bell welcomed the findings, along with Ms Darling who said she hoped that it would mean "Nick didn't die in vain".
When asked if he ever visits his brother, Luke Waterlow paused for a moment.
I think of him regularly," he said eventually.
"He's my brother. There's been communication."
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