A jury found Fenemor guilty last year and he was sentenced to five month's home detention under strict conditions.
However, that has been delayed during the appeal process.
At the heart of the case is evidence of similar court proceedings against Fenemor 10 years earlier. He was accused of indecent assault on another seven-year-old girl, also one of his music students, but acquitted by a judge.
The Crown put two young women in the stand at the 2008 trial who had alleged in 1998 that Fenemor had assaulted them indecently, when they were aged seven and 11 respectively. He was never charged in relation to the second witness, now 24, and found not guilty regarding the younger girl, now 17.
Their propensity evidence - used by the prosecution against Fenemor in the later trial - was prejudicial to the accused and should have been ruled inadmissible, Mr King said.
Given that he was previously charged and acquitted, the Crown should not have led such evidence.
He said the jury did not get the best from the calling back of girls who were now young women. They were vague and could not remember distinctly what had happened so many years ago.
Jurors could well have not understood that there had been an acquittal in that case. The evidence should not have been admitted and was a potential source of prejudice to his client, Mr King said.
Although the previous evidence was available at last year's trial, the judgement and some other original material was not, "due to the passage of time."
"We shouldn't be put in a situation where we have to speculate. It is unfair to the appellant, through no fault of his own," the lawyer said.
The focus of the 2008 trial should have been on the present. Instead it had been on the previous one and its propensity evidence.
For the Crown, Cameron Mander denied Fenemor had been prejudiced unfairly and argued the need to provide the propensity evidence.
He said the appellant had shown nothing to render it unfair.
An acquittal was not the equivalent of innocence for all purposes, said Mr Mander. Nor was the purpose of producing propensity evidence a situation of relitigating the same case on the same evidence.
The Court of Appeal decision ruled that there was no miscarriage of justice and Fenemor's sentence was not manifestly excessive.
Jurors had found him guilty in April last year of the indecent assault charge against the seven-year-old he was teaching to play guitar.
Her mother became suspicious in July 2008 when she walked in and saw Fenemor kneeling in front of her daughter with his hand under the guitar and resting between her legs.
Without saying anything to Fenemor or their child, the parents decided to film two further lessons to gain evidence. Using two cameras, they hid one was in a shoebox and another in a cupboard in the room.
Fenemor was later interviewed by police and charged with indecent assault.
