I don't think it's ever revealed, since in that particular continuum we are only shown flashbacks of some important events that led to the climax.
That being said, there probably was no photograph contest in the first place, since (spoiler!!!):
Our beloved murderous-psycho photography teacher gets arrested, thanks to Chloe's dad and Max's tip.
That ending though
To make it clearer, in the timeline we're referring to:
- Max takes the picture
- Max comes back from future
- Max puts the antagonist in jail before the contest
As you see, there's no point in tearing the photo.
I finally understand what you're saying; must admit, this is a tricky one. We can tackle it using differential diagnosis though:
Originally, storm is caused by Max's powers; it is implied that even a tiniest change in time continuum causes the storm (i. e. the butterfly effect). Thus, we may reason that, since tearing the photo involved time travel in the first place, it is never done.
It gets magically undone somehow (basically being a plot hole).
The one consistent explanation I can think of is:
- She goes back in time to the start of the game;
- Stuff from flashbacks happens
- Storm still happens
- She notices she tore the photo and goes back in time to preserve it
- Relives everything from bullet #1 but with the ending we see.