Evelyn Petty, wife of Frensham parish councillor John, needed a hip replacement and spent 16 days in the Royal Surrey County Hospital following the incident just over a year ago.
But on Tuesday, a jury at Guildford Crown Court found Mary Smith, 54, of Greenhanger, Churt, not guilty of owning a dangerous dog in a public place.
Speaking after the case, Mrs Petty, who was a close friend of the late Liberal Prime Minister and one-time Churt resident David Lloyd George, said: "I am absolutely flabbergasted - this could have been a young child and then where would we have been?
"I'm not the only one to know how dangerous that dog is - and Mrs Smith even admitted in court that it had jumped on me. I can't believe the jury's decision. Maybe they didn't want the dog to be destroyed. But I am the victim here."
Mrs Smith was found not guilty of the charge after telling the court her dog only knocked over Mrs Petty but did not bite her breast as alleged.
The incident happened as the OAP was taking her own dog, Charlie, for an early morning walk.
She encountered Mrs Smith with her terrier-boxer-cross dog on a lead in a narrow woodland path.
In evidence, Mrs Petty said she had seen the dog on previous occasions "snarling and jumping up" but had usually managed to give it a wide berth. But on October 6 last year the path was too narrow.
"I saw Mrs Smith and her dog approaching from some distance. Again, Sheaver was straining and pulling at the lead. Then it jumped up on to my back and pushed me over, so I landed down on my left side. I was in great pain and there was blood everywhere."
Giving evidence, Mrs Smith said the dog belonged to her son, Mark, who had been living with her at the time.
"Sheaver was pulling and Mrs Petty asked if she was all right.
"All of a sudden Sheaver just lunged at her and caught her on the chest with her claws. Mrs Petty lost her balance and fell. She somehow twisted and landed with her back against a wooden fence.
Mrs Smith told the jury that she apologised to the victim. She rejected Mrs Petty's claims that the dog had bitten her while she was lying in agony on the ground. Mrs Smith, said: "I am definitely sure that did not happen."
Mrs Smith had no comment to make about the case.