Shania Lee, 27, was granted bail for a second time on Wednesday afternoon despite having failed to present to court last week, sparking a five-day police search and the issuing of a warrant for her arrest.
She is accused by police of leaving her three children aged under five at home alone about two minutes before fire engulfed a property in Melbourne's northwest.
Lee's girls, aged one and five, died at the scene in Sydenham in September 2024, while her three-year-old boy survived with injuries.
She has been charged with two counts of negligent manslaughter and one of negligently causing serious injury and was freed on bail in September last year despite prosecutors opposing her release.
Prosecutors allege Lee heard the screams of her children on home security video, after leaving the property two minutes and 15 seconds before a smoke alarm sounded.
She failed to appear at court last week for a brief hearing, with a warrant issued for her arrest before she handed herself in on Tuesday night.
Prosecutors and police on Wednesday argued Lee should not be released on bail again because she had not been abiding by her bail conditions and posed a risk to community safety.
Detective Senior Constable Chris Mitchell alleged he had "criminal intelligence" that Lee was involved in "high-risk offending" including police pursuits, possessing a firearm, dealing and consuming drugs.Â
"My fear is she is potentially engaging in criminal offending," he told Melbourne Magistrates Court.
However, he later said her risk to the community would be reduced if she was handed stricter bail conditions.
Det Mitchell said Lee had not been residing at her bail address in the NSW town of Moama with her mother, and had been "couch-surfing" across various suburbs in Melbourne's west.
He said she had been reporting to Echuca police until December 24 and then stopped.
Det Mitchell admitted the case faced delays as he was awaiting a report from a fire expert about its timeline, to get calculations on how quickly the blaze may have spread after the smoke alarm sounded.
Lee's lawyer Nick Jane said she was "going through an incredibly difficult emotional time" in December as it was the birthday of her youngest child - who died in the fire - on the 21st.
He said Moama was isolating for her and proposed she reside at a new address in Altona if released.
Mr Jane argued the prosecution case was weak and said delays would impact his client because she has never been imprisoned before.
Magistrate Olivia Trumble found bail conditions, including a therapeutic support program, curfew and a move from regional NSW to Melbourne, would minimise her risk to the community.
Lee would face lengthy delays if she remained behind bars as the case was likely to go to trial, she found.
The magistrate agreed Lee was going through an "extremely difficult" time when she stopped reporting to police.
Ms Trumble said it was clear she would benefit from treatment for drugs, mental health and grief issues, after she was found eligible for the court's bail support program.
The 27-year-old walked free from court on Wednesday afternoon, with bail conditions including that she reside at an Altona property, report to police three days a week and abide by a 10pm to 6am curfew.
She will return to court on February 24.
Lee's ex-partner Matthew McAuliffe was also charged with negligent manslaughter, but the case against him was discontinued as he died while on bail in October.
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