The 11-page decision, filed Thursday, means the matter will have to be heard in Jefferson County Circuit Court.
The Cress Creek Golf & Country Club, the Shepherdstown Rotary Club and the Caregivers, all are defendants in the case.
Jeri Foster's lawsuit against the sponsors of the 1996 Caregivers' Golf Classic was dismissed in January 1997 after Mrs. Foster's first attorney failed to make a filing on time. The state Supreme Court says Foster should not be punished for her attorney's mistake.
''Sometimes if we follow the rules to the letter it can cause an injustice,'' Larry Schultz, Foster's new attorney said on Friday. ''(The state Supreme Court) did justice.''
Mrs. Foster was pleased with the decision, Schultz said.
''We're very happy. ... She's very happy to have an opportunity to show that she never did anything wrong and a great wrong was done to her when they denied her what was hers,'' Schultz said.
In the original lawsuit, Mrs. Foster contends the organizers owed her $20,000 - the value of the car - plus interest.
Mrs. Foster hit the perfect shot May 10, 1996, on the par-3 11th hole. The lawsuit claims the organizers promised a new car to anyone who hit a hole-in-one on that hole, but reneged after saying Mrs. Foster was too close.
Mrs. Foster made the shot from the designated women's tee, 120 yards away. The insurance company, Hole-In-One Insurance, said the shot should have been made from a distance of 170 yards.
It was not clear on Friday if the insurance company would be involved in the new trial, or if a settlement would be offered to Mrs. Foster, Hamstead said.
Mrs. Foster declined a settlement in 1996, Hamstead said. Mrs. Foster would now consider accepting a settlement if the terms were fair, Schultz said.
No new trial date has been set.
Country club Attorney Russell Marks declined comment. Messages left with attorneys for Shepherdstown Rotary and the country club were not immediately returned.
When reached at her home, Mrs. Foster's husband said she was out of town and unavailable for comment.