A light plane that crashed while allegedly being used to smuggle cocaine from Papua New Guinea to Australia was not airworthy, a court has been told. 

The Cessna aircraft crashed on a remote airstrip north of Port Moresby in July 2020 while allegedly trying to take off for Australia with 540 kilograms of cocaine on board.

Four Australian men — Salvatore Formica, 35, Aiden Khoder, 33, Pierino Forni, 63, and George Machem, 38 — allegedly organised the plane's journey and have been charged with conspiracy to import a commercial quantity of a border-controlled substance.

They are facing a committal hearing in the Cairns Magistrates Court to determine if they'll stand trial.

The registered operator of the plane at the time of the crash was the Northern Territory Air Services (NTAS), although the aircraft was owned by PNG mining company Ravenpol.

Company director Ian Scheyer told the court he had known Mr Forni as a mortgage and finance broker for about eight years, and in 2019 had entered into an agreement regarding the plane with him.

"I was told the aircraft would be used by the owners several times in the year, and for the times it wasn't in use it would be available to us (NTAS)," Mr Scheyer said.

Mr Scheyer told the court the plane, which was based in Mareeba, west of Cairns, had been idle for some time and was neither operational nor airworthy.

He said a local aircraft maintenance company was engaged to restore the plane and he had at one point lent them a propeller to run engine tests.

"As things dragged on, I required that propeller back for my own use," he said.

When the plane crashed in PNG it activated an emergency beacon on board the aircraft, alerting the Australian Maritime Safety Authority (AMSA) who contacted Mr Scheyer as the registered operator.

Mr Scheyer said he initially told AMSA the alert must have come from a personal or handheld beacon registered to the plane as the aircraft was not airworthy.

The next day he was sent a multimedia message containing a picture of the aircraft at the crash site in PNG.

Pilot bragged about getting rich

The court also heard from a former colleague and housemate of the plane's pilot David Cutmore, who remains in custody in Papua New Guinea.

Bo Li worked with Mr Cutmore at a Victorian flying academy and the pair lived together for about four months in late 2019.

Ms Li told the court Mr Cutmore bragged to her about being involved with a drug business that was going to make him rich.

"He told me he'd done some other things before and he'd been in jail, but he didn't get any money," Ms Li said.

"He said this time he would be much smarter.

"He sounded really confident … he thought it wasn't dangerous."

The committal hearing is expected to continue next week, and further sittings of the hearing were scheduled for later this year.

Mr Cutmore is expected to give evidence to the hearing, although not during the current sitting.