A High Court judge has decided not to quash the appointment of Bertha McDougall as Northern Ireland Interim Victims' Commission.
Mrs McDougall is the widow of a police reservist
Lord Justice Girvan said this would allow for the publication of her annual report, to be launched shortly.
The report will contain recommendations to Secretary of State Peter Hain on the interests of victims and survivors.
The judge had ruled that her appointment was "improper and politically motivated".
Mrs McDougall's one-year contract in the post ended on 5 December, 2006 but she made it clear her report would not be published until at least the end of January and was granted a two month extension.
On Monday, Lord Justice Girvan ruled in Northern Ireland's High Court that he would not be quashing her appointment so her report can be published - but reinforced his view that the appointment was improper.
The appointment of Mrs McDougall - the widow of a murdered RUC reservist - was challenged by west Belfast woman Brenda Downes, whose husband was killed by an RUC plastic bullet in 1984.
Mrs Downes launched the legal bid on the grounds there was no evidence to suggest Mrs McDougall would command cross-community support in her role as the interim victims' commissioner.
She also stated the appointment was a sop to the DUP.
Following a lengthy court battle, Lord Justice Girvan ruled that Secretary of State Peter Hain's decision to grant Mrs McDougall the post was both improper and politically motivated.
Following his findings, Lord Justice Girvan was asked to terminate Mrs McDougall's appointment.
He told Monday's hearing: "As a matter of common sense and practicality it would be desirable for Mrs McDougall to be able to complete work on her report."
Speaking following the ruling, solicitor John McBurney, acting on behalf of Mrs McDougall, said: "We welcome the fact that the court has recognised the importance of Mrs McDougall's work and has taken no steps in this judgement to jeopardise that work.
"She can complete her contract term as interim victim's commissioner and will shortly publish her report."
The case is due before Lord Justice Girvan again on Friday to allow the secretary of state time to consider the ruling.
Mr Hain welcomed the decision not to quash the appointment.
He also confirmed that he will appeal the earlier court ruling that her appointment was unlawful.
"Whilst I welcome the court's refusal to quash Mrs McDougall's appointment, I am disappointed by the finding that the appointment was unlawful and I will be appealing that in the strongest possible terms," he said.
The case has led to a senior QC investigating if the secretary of state misled the High Court. Peter Scott was appointed after Mr Justice Girvan asked the attorney general to look at the case.