In a reserved High Court judgment, Justice John Fogarty said James Takamore's widow, Denise Clarke, and his Tuhoe relatives should try again to resolve the dispute, The Press newspaper reported.
If they could not agree, there was a chance to return to the judge for an order, Ms Clarke's solicitor, Gary Knight said.
Mr Takamore, who died in August 2007, is buried next to his father and among his kin at Kutarere Marae, near Opotiki, in the Bay of Plenty.
Ms Clarke spent three days in the High Court at Christchurch seeking a court order to have the body disinterred and reburied according to her wishes as the executor and sole trustee of his will, at the Ruru Lawn Cemetery in Christchurch.
Mr Takamore had lived in Christchurch for almost 20 years. During the court case, Ms Clarke said the move south had caused a rift and her husband had little contact with his family or his Maori heritage.
His burial at Kutarere Marae went ahead because police arrived too late to serve an injunction.
Justice Fogarty ruled that as executor of Takamore's will, Clarke had the right to determine the disposal of his body.
"The judge has said that the collective will of Tuhoe could not be imposed on his executor and over his body unless he made it clear during his life that he lived in accordance with Tuhoe tikanga," Mr Knight said.
The decision meant the judge did not have to rule on to what extent an executor had to take into account Maori customs, he said.
The ruling was "not really a cause of celebration for her family but it is an opportunity to bring closure to the grieving process, which they haven't really been able to do for almost two years", Mr Knight said.
The decision was open to appeal.
A Takamore family spokesman said he would not comment on the decision until he had examined it fully today.
During the hearing, counsel for the Takamore whanau in the North Island, Jamie Ferguson, told the court hearing he could find no record of any similar case in New Zealand's legal archives dating back to the signing of the Treaty of Waitangi 169 years ago.
