Spiritual healer Deanne Mathews, 53, was fined $3000 after she pleaded guilty to the single charge at Bacchus Marsh Magistrates Court on Wednesday.
She was charged with trafficking psilocybin, after police said she provided magic mushrooms to participants who had paid $500 to attend a retreat with Mathews in Clunes, near Ballarat.
On April 13, 2024, Mathews weighed the mushrooms in a white bowl on top of a set of scales, Senior Constable Kerrie-Ann Moroney told the court.
She placed the mushrooms, in ground form, into hot water and gave a bowl to each participant to drink as a tea in two sittings as part of a healing ceremony, the court was told.
"All the consumption of this tea is totally up to the individual, you are never pushed to try this tea," Sen Const Moroney said.
One of the participants, Rachael Dixon, died at the retreat.
However, police found no evidence that Mathews was responsible for her death and she was instead charged with trafficking a drug of dependence.
Mathews' defence lawyer Jon Ross asked for his client not to be handed a criminal conviction for the offending.
He said she had been traumatised by Ms Dixon's death and had not used magic mushrooms in her practice since.
"It's something that will haunt Ms Mathews for the rest of her life," Mr Ross told the court.
"It was Ms Mathews who called the emergency services, and it was Ms Mathews who performed CPR on Ms Dixon.
"And ultimately, it was Ms Mathews who was with Ms Dixon in her final moments."
He said there was "no evidence of a causal link" between Ms Mathews' event and Ms Dixon's death, which was reflected in the charge brought by police.
Mr Ross said Mathews had experimented with the use of psilocybin both to heal her own trauma and that of others, and it had become a vocation she was passionate about.
"She describes that as a vocation, and she's spent her entire life doing this," he said.
"This is something that has benefited Ms Mathews through her own trauma and it's something which she tried to help others with.
"She accepts that she has erred very badly in dong so.... and what is clear is that since this matter, no such events have been held."
He said there was clinical evidence psilocybin can assist in certain settings with mental health conditions including depression, anxiety, addiction and obsessive compulsive disorder.
But Mr Ross also said magic mushrooms were "a very small subset" of Mathews' practice, and handed six character references to the court discussing the "care and skill" she puts into her therapeutic practice.
Magistrate Julia Barling asked Mathews to stand as she decided to spare her a criminal conviction for the offending.
"I will specifically note that you are being sentenced today for the charge of trafficking a drug of dependence, and there are no charges in relating in relation to the passing of that participant," she said.
She noted events of this type are "becoming more prevalent" and decided to fine Mathews $3000, instead of handing her a good behaviour bond, to send a message to the community.
"Regardless of any views that you may hold about the benefits of ingesting particular substances or supporting other people to ingest substances, it is illegal and it will not be tolerated by the community, and it will not be tolerated by the courts."
Mathews walked from court a free woman.
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