In February, a Canberra magistrate found Lauren Suzanne Aynsley guilty of menacing driving and sentenced her to perform 160 hours community service and sign an 18-month good behaviour order.

But Ms Aynsley appealed against the conviction and sentence, claiming the magistrate's finding of guilt had been unsafe, and the evidence that convicted her had been unreliable.

At trial, the ACT Magistrates Court heard the alleged victim and Ms Aynsley had been friends, but had fallen out over a man with whom they had both been romantically involved.

Court documents said the alleged victim had been waiting for a taxi outside the Woden Southern Cross Club about 4.30am on September 10, 2012.

She walked towards the cab when a white hatchback drove at her three times, and struck her on the thigh twice.

The alleged victim feared for her life and escaped by getting into the taxi.

It was alleged that Aynsley had been the driver and had yelled: "I'm gonna f---king kill you c---."

Ms Aynsley was arrested and charged, but pleaded not guilty on the grounds that the prosecution could not prove she had been the driver of the car.

She said she had been at home at the time of the incident.

But the magistrate rejected her evidence as unreliable, and found her guilty of the offence.

Lawyers for Ms Aynsley appealed to the ACT Supreme Court, arguing that the magistrate could not have been satisfied beyond reasonable doubt that she had been the perpetrator of the attack.

The defence argued the alleged victim's evidence had contained factual errors, including that the car involved had frangipani stickers on its side whereas Ms Aynsley's vehicle had been decorated with a southern cross.

Ms Aynsley's legal team also pointed out differences between the alleged victim's evidence and that given by the taxi driver, including that the car had been a Toyota and not a Hyundai Excel.

Justice Hilary Penfold, in a judgment published this week, overturned the conviction and entered a verdict of not guilty in its place.

The judge found the magistrate had incorrectly based her findings on her impressions of the two women.

"The real problem with her honour's decision was that she first formed a view, based on the evidence before her and particularly on her impressions of the complainant and Ms Aynsley, and on the content of Ms Aynsley's evidence, that the complainant was telling the truth and Ms Aynsley was not," the judge wrote.

"Next, having drawn conclusions about the respective credibility of the complainant and Ms Aynsley, her honour relied on these conclusions in assessing the reliability of the complainant's evidence, and especially in setting aside weaknesses in the complainant's evidence to the extent that it was inconsistent with independent evidence."

Justice Penfold said the magistrate had "in effect [pulled] the complainant's evidence up by its own bootstraps".

The judge wrote that this had been a flawed approach to dealing with identification evidence.

"As well as the well-recognised danger of relying on identification evidence, there were also some specific challenges to that evidence arising from the evidence of the taxi driver.

"Given the extent to which the guilty verdict depended on the magistrate's conclusions that the complainant was a truthful witness and therefore that her evidence, in particular the identification evidence, was reliable, I find, with some hesitation, that the verdict was unsafe and unsatisfactory."