The trial of Hunter Mulford, the 44-year-old Montgomery County public school teacher changed with sex offenses involving two of his pupils, ended its second day yesterday with the prosecution dropping all charges relating to one of the boys, and the defense claiming that both boys are lying.

The 11-year-old youth, a student at Newport Middle School in Kensington, repeatedly testified "I don't remember" when asked by Assistant State's Attorney Barry Hamilton if Mulford touched him "on any part other than your back" the night the two boys joined their teacher in his room at a school retreat in Rockville. After this testimony, the prosecution dropped the charges against Mulford that involved the 11-year-old.

The first boy testified Monday that Mulford had rubbed the backs of both boys, and that Mulford engaged in sexual act with him in September of last year.

Using the testimony of the boys' parents and friends, the prosecution attempted to paint a picture of a man who spent extra time, money and attention on the two boys, driving them home or to a pinball arcade three times a week, continually buying them candy, and giving them record albums for Christmas.

In his opening statement, defense attorney Ron Willis charged that the two boys made up their story after watching a television program with a similar scenario which was aired four days before thay made their accusations in late January.

Willis also said that Mulford has a record without blemish in his 17 year as a teacher.

Friends of the boys testified that their reputation for telling the truth was "not very good."

Betty Mulford, the teacher's wife of 19 years, said that they had a good marriage, and that their sexual relationship is "very close, very satisfying, very frequent."

Mulford has been on administrative leave from his school since Jan. 30, and is appealing the school superintendent's recommendation that he be dismissed.