In London's high court yesterday Mr Justice Collins opened the way for a full judicial review of Margaret Baumber's complaints.
Ms Baumber had been the City of Sunderland's principal educational psychologist, for nine years before her dismissal.
Her counsel, Tim Kerr, said her departure was prompted by her refusal to prematurely submit reports on children with special educational needs against her professional judgement.
Her principled stance led to her suspension in May last year and her dismissal in January, he told the court.
Mr Kerr said it could not be misconduct for Ms Baumber to refuse to obey her employers' instructions to do something which was itself unlawful.
Ms Baumber is seeking a high court declaration that she was 'legally obliged' to have sight of all available written reports before requiring her to submit her own advice to the council's special needs service.
Mr Kerr told the court that her dismissal was currently the subject of an internal appeal and industrial tribunal proceedings.
'She contends that she would have been compromising her professional standards and risking detriment to the child concerned if she were to finalise a report without having read the available written reports of other professionals.
'In her professional judgement she needs to read and take into account all advices before finalising her own reports.
'If the order is unlawful then it is not misconduct to refuse to obey it,' Mr Kerr told the judge.
Ms Cherie Booth, for the City of Sunderland, argued that Ms Baumber's case had no place before the high court.
'The proper forum for arguing the lawfulness of the decision should be in an industrial tribunal where all the reasons for her dismissal will be looked into.'
One of the reasons behind Ms Baumber's dismissal 'was the backlog of reports on her desk that need to be finalised,' Ms Booth told the judge.
Delays by the local authority in statementing children with special educational needs had been the subject of 12 ombudsman reports and one set of high court proceedings, she said.
But Mr Justice Collins said he was persuaded that Ms Baumber had an 'arguable point'.
Unless matters are resolved in the meantime, Ms Baumber's case will return to the high court for a full judicial review hearing.