Northern Irishman Hoey holed a nervy four footer on the last for a birdie to get to 36 under but even then there was an agonising wait as the pair knew they could still be denied right at the death.
In the final group, Danny Willett was left with a birdie putt of his own that would have handed him the team trophy alongside Jimmy Dunne, but the 2016 Masters Champion had to settle for a par as he took home individual honours.
For Danaher - a 22 handicap left hander who putts right handed - the victory not only gives her bragging rights over husband Gerry McManus, who finished fifth alongside Shane Lowry, but also continues a proud family record in the team event.
Gerry's brother JP is a two time winner, while JP's son Kieran has surpassed his father with a trio of wins.
It is absolutely amazing to win this competition in such an exciting finish and I am especially happy for Michael
“Gerry and I had a little bet on the first day to see who could get the best score, so I’ve won that! And that’s really pleasing!" said Danaher.
"But it is absolutely amazing to win this competition in such an exciting finish and I am especially happy for Michael.
"He is an absolute rock, he’s fantastic. I wish he could have won the individual event too but hopefully he’ll get an individual win again soon.”
Kiwi Ryan Fox and Australian cricketing great Shane Warne also finished at 36 under after a remarkable closing 56, but Hoey's individual score of eight under broke the tie, with Fox six shots further back.
“I knew there was a bit of money on my last putt on the 18th, but I was trying not to think about that," said the five time European Tour winner.
“It was probably four feet but the wind was picking up and if you don't strike it solid it can easily go off line. I'm glad I made a good stroke but it was more about the team as well.
"I didn’t want to let Maeve down on that final hole because I knew we had a chance to win it.
“So there were a few things going on at 18 and although I didn't play unbelievably today, I still kept it pretty solid because this can pay for my season. It's quite a big thing.
"And Maeve was brilliant to play with. She was great company. We dovetailed well and got lucky, really, because both of us came in at the right times. It was just a really enjoyable few days.”