Butters was fined $1500 by the AFL tribunal last Tuesday for abusing field umpire Nick Foot during the Power's loss to St Kilda in round five.
Foot told the tribunal Butters asked him "How much are they paying you?'' after awarding the Saints a free kick.
Butters vehemently denied making that comment, but the tribunal sided with the umpire, who reported him at the time of the incident.
Monday night's appeals board hearing barely referenced the original hearing at all, as Port appealed based on an error of law regarding former Essendon midfielder Jason Johnson's conduct as a panel member.
Johnson, a real estate agent, tuned in to the online hearing in his office then briefly disconnected and switched devices to his mobile phone as he drove to an open house inspection.
The Power argued that "was inexplicable and amounted to a miscarriage of justice".
"The board cannot be satisfied that Mr Johnson in those circumstances was paying proper attention to his duties and adjudicating appropriately," lawyer Paul Ehrlich KC said, noting it had to be inferred Johnson was distracted.
After deliberating for 14 minutes, the panel of Will Houghton (chair), Stephen Jurica and Richard Loveridge agreed, and upheld the appeal.
Houghton said the conduct "constituted a miscarriage of justice" and "it was clearly an error of law that had a material impact on the decision of the tribunal".
The appeals board moved that the original case should be "remitted to a properly constituted tribunal" and heard again.Â
But the AFL had determined if the appeal was upheld, there would not be a re-hearing, and reiterated that after the board's findings, meaning Butters is cleared and his fine is wiped.
In somewhat comical scenes in a bizarre hearing, Ehrlich's submissions were punctuated by his dog barking in the background.
Ehrlich, in his submissions, pointed to a High Court case which found "a member of a tribunal who does not appear to be alert to what is being said in the course of the hearing may cause that hearing to be held unfair"
He also said it was impossible to know whether, if Johnson hadn't been distracted, he couldn't have convinced fellow panellist Darren Gaspar and tribunal chair Renee Enbom KC that Butters should be cleared.
Albert Dinelli KC, representing the AFL, acknowledged it was "regrettable" that Johnson had briefly disconnected from the hearing but rejected the suggestion it amounted to an error of law.
Dinelli described it as a "minor lapse" and said Butters had not been denied his right to a hearing.
"It is not said that he was not paying attention at all, albeit driving for part of the submissions and present for the deliberations," Dinelli said.
The appeals board, however, sided with Port.
