Neighbour Rusty Eunson said Mr Mullholland fell when the dog went at him, allowing the little Papillon to be snatched up into the jaws of his attacker.
"Peedee is 8 years old but the other dog was so big it just grabbed him and dragged him by the throat," he said.
All Mr Mullholland can remember is seeing a shadow and turning to see "a big dog with jaws on him like a crocodile," coming for him.
"I was left with my hands bitten, a bruised head, black eye and injuries to my leg and shoulder - a rotar cuff sprain.
"I can't remember hitting the ground, but I knew that dog was out to kill mine, so I picked myself up ran off after the dog screaming, 'he's going to kill my dog'.
"I've never seen a dog attack like it," Mr Mullholland said. "The thought of Peedee being killed, well . . . I couldn't live without him and at the moment I'm still in shock and on medication. This dog is part of my family and if he'd been killed, I'd have been dead soon after."
Mr Mullholland moved to Dannevirke from Woodville because he couldn't relax after his home was broken into.
"A 13-year-old stole my laptop and I ended up having to pay $300 excess to the insurance company," he said. "I was so unsettled I had to leave as soon as I could."
Mr Eunson said a visitor at the attacking dog's home managed to wrestle the dog to the ground, while the pair tried to free Peedee.
"The big dog was shaking him and trying to tear him to pieces," he said. "It's only his long hair which saved him. This was definitely an attack, not unwanted attention and I believe this isn't the first time this particular dog has attacked another dog. It's a concern for me because my son is in a wheelchair and has a little Jack Russell he takes out with him. This is a dangerous dog and although it's not my decision, something needs to be done about it."
Cameron Tait, the animal control officer for the Tararua District Council, said he was still investigating what had occurred between Mr Mullholland's dog and the English bull terrier/staffordshire cross.
"I'm still holding the dog in our kennels and while I realise there is a lot of emotion surrounding this case, all I can do is deal with the facts. It's going to be difficult," he said.
Mr Tait said although he'd heard anecdotal evidence of the dog being involved in another attack there are no complaints on record to add credence to the outcome in this case.
"I haven't even had a report of the dog being off his own property," he said.
Mr Tait said he has to work with the law and a very specific set of legislation when investigating an attack such as this.
"Unfortunately, the outcome isn't going to be suitable for some people," he said.
Meanwhile Mr Mullholland still can't believe what has happened.
"Peedee is a very lucky dog and wasn't even punctured by the other dog. He was covered in blood, not his, but mine," he said.
"You know if that dog had jumped the fence and mauled sheep it would have been shot on the spot. Instead it's still in the council kennels.
"There's no way I could have stopped the attack and I hate to think what could happen if it was allowed back to its owner.
"I've met with the Tararua District Council's dog ranger and said if they put the dog down that will be the end of it. But I can't allow the dog back on the streets and I'll fight council all the way if that's what they decide to do."
At the time of the attack Mr Mullholland said he had great support from the Dannevirke Police.
"Two young coppers came and they were wonderful and took me to the hospital," he said. "I was there for a couple of hours and needed stitches in my hands."
Another neighbour Max McFarland persuaded Mr Mullholland to let him take his dog to Tararua Veterinary Services where he spent the night. The owner of the other dog paid the vet bill for Mr Mullholland.
"He's on medication too and is quite jumpy now," Mr Mullholland said. "I came off worst but I'd rather have it that way."
And while Mr Mullholland has been traumatised by the attack, he said the goodwill of his neighbours has kept him going.
"I've been away with the fairies since the attack and feel like I'm going to keel over, but my neighbours have been wonderful. Max and Jean McFarland invited me to tea the night of the attack and I know this is a good community," he said.
