A British woman convicted of racism after calling her New Zealand-born neighbour an Australian has had her name cleared.

Space to play or pause, M to mute, left and right arrows to seek, up and down arrows for volume. Listen Duration: 4 minutes 32 seconds 4 m 32 s Court finds Australian slur not racist after all ( Lexi Metherell ) Download 2.1 MB

Last November, Petra Mills was arrested after calling her neighbour a "stupid fat Australian" during a drunken tirade on her front lawn.

The neighbour, Chelsea O'Reilly, says Ms Mills knew she was born in New Zealand but used the term "Australian" to offend her.

Ms Mills was charged with racially aggravated public disorder and fined $162.

However, the local court in the city of Chester has overturned the decision, ruling that using the word "Australian" is not a racist slur.

Ms Mills has since moved to north Wales to escape the embarrassment caused by her conviction.