Ewen Macdonald cried after being found not guilty of murdering Scott Guy while Kylee Guy stormed out and screamed he killed her husband.
The jury came back after 11 hours to find Macdonald not guilty of murdering his brother-in-law.
Families from both sides were in court to hear the verdict.
Anna Macdonald was clinging to her father Bryan with tears rolling down her face during the reading of the verdict.
After Ewen Macdonald, crying, was helped from the dock by his prison escorts after the judge discharged him.
Macdonald’s family sat behind him as the verdict was read.
Members of the Guy family sat quietly throughout.
After a short break, Justice Simon France returned to court and remanded Ewen Macdonald to a callover for a sentencing date to be fixed on other charges he is still to be sentenced on.
He will appear next in the Palmerston North District Court on July 31 and is still in custody.
Outside the court, Bryan Guy, Scott's father, read a statement to the media.
"The acquittal today leaves our family with mixed emotions. While we are relieved the trial is over we are obviously left wondering who is responsible for the death of our son."
"This verdict today will not bring Scott back. This verdict will not restore a father to his children. It will not restore a husband to his wife. It will not restore a son and brother to his family."
"Our lives have been altered forever. The pain of our broken hearts is at times almost too much to bear. However, through this tragedy we have learnt a lot. Mostly about ourselves, what we stand for, what our values are, what is important to us.
"We have learnt how important a father is to his children. We know that a father can never be replaced."
"We are thankful for how Scott touched our lives and we are richer for him being part of it. We must focus on what we have, not what we have lost. We are determined to love and support our children and grandchildren in their future.
"During these past weeks and months our lives have been an open book to the nation. We now wish to close this chapter and take time to pause and reflect away from that publicity and begin to rebuild our lives.
Mr Guy looked emotional, but was composed and spoke clearly as he read the statement.
FOUR-WEEK COURT CASE
Today's verdict ends a four-week legal struggle over evidence, motive and circumstance in the High Court in Wellington.
Macdonald was accused of killing 31-year-old Guy outside his rural Aorangi Rd property about 4.43am on July 8, 2010, over tensions about the family farm's future.
He had already admitted to setting fire to an old house on Guy's property, vandalising his new house, and stealing two deer from a nearby farm.
During closing arguments last week, Crown prosecutor Ben Vanderkolk said Macdonald had the skill and the state of mind required to kill Guy, and asked the jury to give a verdict based on "common sense".
He said Macdonald knew when Guy would be leaving home, where the farm shotgun was and owned the dive boots with distinctive soles found on the crime scene.
However, defence lawyer Greg King said there were four fatal flaws in the Crown case including that three of the four Crown witnesses heard shots about 5am when Macdonald was at work.
"There is not simply reasonable doubt in this case, but there is an absolute abundance of it".
King described Macdonald's crimes of vandalism and arson as "despicable" acts - but said he was not a murderer.
The high profile case has gripped the country for nearly two years.
The public gallery was packed almost every day during the trial, and at one point about 100 people lined up to get a glimpse of the proceedings inside.
Friends, colleagues and family of both Guy and Macdonald, including wives Kylee Guy and Anna Macdonald testified, often holding back tears in the witness box.
Macdonald showed little emotion in the dock, spending a lot of time taking notes.
He broke down in tears when his wife told the jury their life had never been more perfect up until Guy's death.
THE CROWN CASE
Vanderkolk argued that Macdonald carried out a campaign of intimidation against Guy and his wife Kylee since tensions began brewing between the two men in 2008.
When that failed, he turned to murder, Vanderkolk said.
He alleged Macdonald closed the farm gates that were normally open, forcing Guy out of his ute and trapping him.
Vanderkolk said he then shot Guy twice, first in the throat and then in the face and arms.
According to the Crown, Macdonald wore size-nine Proline dive boots that he bought in March 2004 to commit the crime, and he used the farm shotgun.
The gun was normally locked away, but was found with an ammunition belt near the farm office door on the day of Guy's death.
After the murder, Macdonald allegedly then rode a bicycle 1.46km down the road to Byreburn, arriving just after 5am, and carried on with the morning milking.
Vanderkolk said he killed and buried three chocolate Labrador puppies located in a shed about 80m from the house in order to deter police.
Macdonald was also heard telling Guy's sister Nikki that he had been shot, when those who had seen the body, including police, believed at that stage his throat had been cut.
The Court was played a video of Macdonald where he spent the first few hours lying about the theft, arson and vandalism to police.
He later admitted to the crimes when police revealed that his accomplice Callum Boe had confessed.
Macdonald told police that anger at Guy fuelled his and Boe's attack on the new home, but continued to deny the murder.
"I wouldn't take someone's life. I've never been that extreme," he said.
Police told the Court they excavated parts of 300-hectare Feilding farm, where Macdonald was living, looking for dive boots, dead puppies and shotgun cartridges, among other things. They found nothing.
King said police should have tried harder. He grilled forensic David Neale about the measurement of footprints found at the crime scene.
Neale told the Court he determined boot impressions by measuring the width of the heel and forefoot, which determined the more than 50 footprints next to Guy's body were size 9.
However, King said there was between 32 and 33 rows of waves on the plaster impressions of the prints, more than the size-9 Proline boot in evidence.
He also called American shooting champion Mitchell Maxberry as an expert witness, who said it would take him seven seconds to fire two shots, reload and fire a third shot with a double-barrelled shotgun, like the one the Crown said Macdonald used to kill Guy.
Two Crown witnesses told the Court they heard three shots in succession.
King said that was too quick for the farm shotgun, and a semi-automatic gun would have been used.
Other holes in the Crown's case were that a car was seen near a house and a cigarette packet found outside the house matched one stolen by a burglar with a history of shotgun crimes, King said.
"Look at the evidence in a way that divorces it from emotion, look objectively, look at cold, hard evidence and the Crown case fails," he told the jury.
"What happened was a tragedy and should not have happened but this mystery is not solved."
THE TRIAL, AS IT HAPPENED
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