STUART, FLA. -- In the infuriating matter of young Todd Neely, the good news and the bad news is all the same. He will have to be tried again for a crime that almost certainly was committed by another person.

That is the substance of an order entered on June 27 by Florida's three-judge Court of Appeal for the Fourth District. The court concluded that Neely's first conviction three years ago was ''seriously flawed.'' Neely had been denied the ''fundamental fairness'' required by our judicial system. Nevertheless, in the court's view, Neely must go through yet another trial so that justice will be adequately served.

The Neely case is important to the defendant and his family, of course, but the story serves another purpose. It provides a searing example of what can happen when the awesome power of the state is wrongly applied.

As two separate Florida courts now have concluded, Neely is the victim of incompetent police, an inexperienced and ambitious prosecutor and a couple of witnesses who revised their stories in the period between arrest and trial. More than anything, he is a victim of the bottomless pockets of the state of Florida, which apparently is ready to spend whatever it takes to pursue the issue.

The story goes back to the evening of June 17, 1986, when Todd Neely and his family were having dinner at a restaurant known as the Lobster Shanty in Jensen Beach. The restaurant clocks its customers in and out as a check on efficiency of service. A receipt for that evening shows that the Neely party was clocked in at 8:26 and clocked out at 9:31.

At 9:12 p.m., Linda Zavatkay dialed 911 to report that 10 minutes earlier she had been attacked and stabbed by an intruder at her home in the River Pines residential development. Neely lived nearby. She provided a description: the assailant was a slender boy with light hair; he had braces on his teeth. He was ''16, max.'' Later she would identify Neely from a photographic lineup that included a high school photograph of Neely that was several years old. Neely has never worn braces. He was 18 at the time of the attack.

In response to her complaint, local police made an investigation of sorts. Two officers canvassed the neighborhood and turned in their canvass sheets. No effort was made to take fingerprints from the kitchen knife used in the attack or to connect the knife with Neely.

An assistant state attorney formed the theory that Neely, his mother, his sister and his stepfather were all lying about dinner at the Lobster Shanty. He scoffed at a restaurant receipt indicating dinner for four. His theory was 1) that Neely had never been in the party at all; or 2) that he slipped away from the table, commandeered his stepfather's car, drove 11 miles at breakneck speed back to River Pines, picked up a knife in his family kitchen, attacked Linda Zavatkay and drove back to the restaurant, where he was seen leaving in his parents' company.

The case went to a nonjury trial in January 1987. Linda Zavatkay recanted her statement about the braces. Her boyfriend, who earlier had been incapable of identifying anyone, now identified Neely from ''an outline.'' The defense offered no testimony. Neely was convicted of attempted murder. The judge, now retired, sentenced him to 15 years in prison.

Then all kinds of things began to happen. John Talliere, a resident of River Pines, read about the case in The Stuart News. He and his wife were appalled. They were certain the wrong man had been convicted. During the police canvass, a woman police officer had shown Kathy Talliere a composite drawing of the attacker. Mrs. Talliere made positive identification: the drawing closely resembled a neighborhood kid named Dennis Raether.

Raether wore braces. Mrs. Talliere told police he had committed several sexually deviant acts in the neighborhood. In March of last year, in one of the many court hearings in this case, two young women testified that Raether had attacked them sexually, in one instance with a butcher knife. Other testimony came from witnesses who said Raether had boasted to them of the crime. Yet defense attorneys never were able to get at this evidence because the prosecutor deliberately concealed the canvass sheets. Raether has now disappeared. Police never questioned him.

Most of the time the mill wheels of the law grind evenly. Gross miscarriages of justice seldom occur. But when the process goes berserk, as it did in this case, the wheels grind up everything in sight. Ask the Neely family.

1990, Universal Press Syndicate