The 15-year-old's bloodied body was discovered in her bed after she'd spent the night out with friends in Toowoomba in 1989.

A second inquiry into Annette's death has heard mounting evidence person-of-interest Allan McQueen told those close to him he was behind her death.

McQueen, also known as Allan Gill, and his brother Craig Gill were among a group of people arrested after a punch-up outside the Norville Hotel on November 22.

Retired police officer Vernon Holcombe said he heard McQueen yell out in the watch house that he'd sodomised and beaten her only three days prior.

"I could hear one of them say that 'I was f***ing her ... while I bashed her over the head'," Mr Holcombe told the inquest on Tuesday.

"The police knew there were people who may have been involved in Annette's circle of friends and acquaintances and so we sort of had knowledge that that's what they were talking about."

Another police officer involved in the arrest, Sergeant Tony Robin Smit, said he heard one of the men shout out from their holding cell: "I killed that f****** slut."

Sisters Kelli-Lee and Kylie Leggatt recalled Craig Gill later telling them about their night in the watch house.

"Craig just said that (Allan had) yelled out he killed the bitch ... obviously he was in the lockup with him to hear it," Kylie Leggatt told the inquest.

"Everyone had been drinking and stuff so you just think, yeah, whatever."

During a card game with friends later that evening, Allan McQueen blurted out he had killed Annette but that it was an accident.

"(He) said something to the effect of 'Whoever did it didn't mean to do it, it was meant for someone else'," Kelli-Lee Leggatt said.

"He said 'I killed Annette Mason'."

The sisters say they didn't take the remarks seriously at the time because everyone was intoxicated after a day of drinking.

Kylie Nothdurft has told the inquest she was at that house earlier in the day when she overheard Allan McQueen say he did it.

"I remember that as clear as day," Ms Nothdurft said on Monday.

Neither of the sisters can remember her being at the house.

The inquest heard a then 16-year-old Ms Nothdurft had told police what she heard but backed out of giving evidence at an inquest in 1991 because she was scared of McQueen.

Witness Robert Speedy, jailed in 2015 for the attempted murder of a Gold Coast police officer he shot in the face, is facing a contempt of court charge after refusing to give evidence via videolink from prison on Tuesday.

The inquest continues.

Australian Associated Press