"We prayed while they worked on him but the doctor came to us and said, 'No, he's passed away' - we were shocked and we were stunned."
While upset and traumatised Father Paul said the congregation could take heart and solace in that their beloved monsignor had died in the place he had worked so hard to build.
"If he had a say in this then that is the way he would have orchestrated it," Father Paul said.
"They can take some comfort in that. It is sad but this is the way it is - it is a part of life."
Monsignor Hannigan had also carried out the service at last Thursday's Anzac Day civic service in Napier.
He had been due to make another of his two-yearly visits back to Ireland but now members of his family were preparing to travel to Napier for his funeral service instead.
A brother and sister and two nieces will arrive for the funeral, which will be held at St Patrick's Church on Friday at noon.
Father Paul said people would be coming from all over the country and the diocese had considered staging it at a larger venue.
"But it has to be here," he said.
"It was his church."
Eighty-two-year-old Father Tim, which was how he liked to be addressed, was born in Ireland, the eldest of four.
His father was a banker and he once said with a smile it was a bit of a shock to his mother when not only did he decide to go into the priesthood, but made it known he wanted to minister on the other side of the world - in New Zealand.
He had become interested in the priesthood after meeting and being impressed by the then-New Zealand Archbishop (later Cardinal) Peter McKeefry of Wellington.
"All I knew about New Zealand was the All Blacks," he once said in an interview.
He spent six years at a seminary before being ordained as a priest and emigrated to New Zealand in 1956, when he was 25 years old.
"When the ship docked in Wellington, I asked, 'Where's the city'?"
His first appointment was at St Anne's in Newtown, Wellington, and he spent five years as a hospital chaplain in the Wellington Public Hospital.
"It was a 1000-bed hospital and an amazing introduction to real life for a young priest. I matured very quickly."
Other appointments were to Levin in the '60s, where he was responsible for boys at two borstals - one for primary schoolboys and the other for teens.
"It was quite challenging."
That was followed by a three-year appointment at his first parish - Ohura, 130km north east of Stratford - about an hour's drive on a metal road from Whangamomona.
After another trip back to Ireland to see his family he was appointed director of the Diocesan Pastoral Centre in Palmerston North and spent 10 years there. He was appointed head of St Patrick's Parish in Napier in 1979 and a year later, when the new Palmerston North diocese was formed, he also became the VG (Vicar General) to the bishop, Peter Cullinane, a position he held for 10 years.
In 2000 his "services to the community" were recognised when "Monsignor Timothy Francis Hannigan" was made a MNZN, (Member of New Zealand Order of Merit).
For many years he also held the position of National Chaplain of the Knights of the Southern Cross, an order of Catholic men committed to promoting the Christian way of life throughout the country.
While he had long stepped down from administrative and main duties at St Patrick's he continued to participate in all facets of the church, including working with St Vincent de Paul looking after the needy.
"It is a great loss to us all," Father Paul said.