Johnson won the 2011 Victorian Wingless Sprints title at Ballarat by a half a lap but was later disqualified because officials deemed his engine had breached specifications. 

Under the rules of the budget class, he was banned from speedway racing for nine months.

But Maddens Lawyers, on behalf of Johnson, who denied any wrongdoing, lodged a Magistrates Court claim against the Australian Wingless Sprint Racing association, arguing the driver had been denied natural justice and his reputation had been damaged.

In a mediated settlement, the national body has agreed Johnson is not a cheat. It will also review the sport’s rules and regulations and Johnson will be given an opportunity to appeal his disqualification to a three-member panel.

Maddens Lawyers principal Robert Cole, counsel for Johnson, said his client had spent “tens of thousands of dollars” in the fight.

“It wasn’t about money, it was about his reputation,” Mr Cole said.

“It was about clearing his name.”

In a letter to Johnson, AWSR national president Allan Woods, of Queensland, said the body acknowledged the alleged breach was not intentional.

“It does not regard you as a cheat or in any manner as having intentionally breached the rule,” he wrote.

“This fact is reflected by the minimal penalty which was initially imposed.”

Mr Cole said the outcome of the action meant sporting organisations had to have clear rules and procedures.

“There is a huge investment of money for no return (in speedway) but people have to be afforded the right to natural justice. 

‘‘The problem is they are hung, drawn and quartered on the spot.”

Mr Cole said he would lodge an appeal on Johnson’s behalf against the alleged breach.

Under the settlement, the three-member panel will be asked to rule if Johnson had breached the sport’s rules. 

The allegation centred on whether aftermarket valve springs in Johnson’s engine were the same physical dimensions as the original factory springs.

Johnson’s valve springs were fitted with a dampener, which are the only ones manufactured. 

The dampener is not considered performance enhancing.

Mr Cole said Johnson could yet be reinstated as the winner of the title, which carried a $2000 first prize, if his appeal was successful.

Under the terms of settlement, the appeal has to be held within three months.