The runanga confirmed it would pursue remedies through the tribunal rather than negotiating a settlement with the Crown - leading the Crown to suspend its recognition of the mandate.
"Essentially I do not believe the runanga represents nor acts in the best interests of the people. It's that simple.
"At the end of the day, we want a way forward and the best way to get there is to achieve consensus," said Ms Peters.
Anahera Herbert-Graves, Te Runanga-a-Iwi o Ngati Kahu chief executive, said Crown recognition of the mandate was not required in the courts or the Waitangi Tribunal.
"Ngati Kahu is not in negotiations with the Crown, and are instead pursuing their legal rights through the courts and the Waitangi Tribunal, as instructed by their hapu and marae [which] rejected the settlement offer made by the Crown, and the tribunal failed to adhere to its legal obligations."
Pita Tipene, co-leader of Te Kotahitanga, which opposed the Crown's recognition of Tuhoronuku's mandate to negotiate Ngapuhi's Treaty claims, said the decision showed Mr Finlayson was willing to make hard decisions.
He said something needed to be done about Tuhoronuku's mandate, which was losing support.
"The mandate was always conditional on them maintaining support and clearly they have not maintained it."
While Tuhoronuku had initially agreed to accept the Maranga Mai report in its entirety, in mid-February the group said they wanted to make amendments.
Maranga Mai is a report recommending a way forward for the iwi.
It was established by an engagement group comprising the Crown, Te Kotahitanga and Tuhoronuku following a Ngapuhi Tribunal report which found the structures of the mandated-body undermined hapu sovereignty.
Hone Sadler, Tuhoronuku chairman, was unable to respond by edition time yesterday.
Te Kotahitanga co-leader Pita Tipene said he was not surprised Tuhoronuku had changed their position.
A spokeswoman for Mr Finlayson said he last met with Tuhoronuku and Te Kotahitanga on February 23.
"Ministers are currently considering the implications of TIMA's advice that it will not implement all the changes recommended in Maranga Mai and the amendments TIMA has proposed to the mandate structure recommended in Maranga Mai."