The sergeant and probationary constable told IPCA investigators they watched the car "travelling too fast" – being driven by a man - brake heavily to avoid colliding with a vehicle in front as it rounded a corner.
The officers were concerned about the "potentially dangerous" driving and signalled for the driver to stop.
However, the man carried on through central Kaitaia at 40km/h before he accelerated down Commerce St.
Police then pursued the fleeing driver at a safe distance – hitting speeds up to 115km/h in the 50km/h zone.
A pursuing officer radioed Northern Communications Centre and informed them the road was clear of other vehicles.
During the pursuit, the Mazda turned right onto Redan Rd and past Kaitaia Hospital in the direction of Ahipara.
The driver swerved to dodge the road spikes laid out by police and fled out of town on a largely straight rural road.
Police said as the sports car approached a series of bends it was clocked at a speed of 150km/h in the 100km/h.
It was at this point, two minutes and 44 seconds in, police abandoned their pursuit on Kaitaia-Awaroa Rd.
Seconds later, one of the officers saw a flash as the car crashed into a power pole killing backseat passenger Justin Ricky-Lee Murray, 24, of Te Kao, and injuring four other people in the vehicle – including the car's owner.
The vehicle's driver admitted to three charges of causing injury while driving with excess blood alcohol, one charge of causing death while driving with excess blood alcohol, and failing to stop for police.
He was sentenced to 11 months' home detention and disqualified from driving for three years.
Neither officer was charged as a result of a police criminal and employment investigation into their actions that morning; two officers received an employment outcome but continue to work for New Zealand Police.
Police notified the IPCA, who then conducted an independent investigation.
The findings stated police should have abandoned the pursuit when they were forced to travel at high speeds to keep up with the Mazda; when the car turned into Redan St; and when road spikes failed.
Authority chairman Judge Colin Doherty ruled the pursuit was unjustified because the immediate risks of pursuing the likely-intoxicated driver outweighed those created by allowing them to drive away.
"The pursuing officer's risk assessment was flawed. He knew there were several people in the car whose safety was dependent on the fleeing driver's decision making and driving skill, which was probably already compromised."
When making a risk assessment police are required to consider the threat posed by the person they are pursuing, the necessity, and dangers to other police and the public.
The investigation found the officer failed to give the correct reason for the pursuit which affected the assessment and decision making of the police dispatcher, pursuit controller, and tactical officers.
Doherty said it would've been safer to let the car go and make follow-up inquiries using the Mazda's registration details.
"He did not give enough consideration to the additional pressure a pursuit would likely place on the fleeing driver, increasing the chances of unsafe driving."
The officer told investigators he believed the driver would revert to the unsafe driving police witnessed if the driver wasn't stopped.
Northland police district commander superintendent Tony Hill said they accepted the findings that despite the officers' intentions to stop the intoxicated driver from causing further harm on the road, they should've made follow-up inquiries instead.
"We would like to take this opportunity to extend our sympathies to the family of the victim who was killed in the crash. This is a worst-case outcome in a situation like this and our thoughts continue to be with them."
Hill said there had since been a revision to police's fleeing driver policy following the Fleeing Driver Review involving Police and the IPCA.
In Northland this year, there have been 52 incidents involving fleeing drivers - 38 of these pursuits were abandoned by police, five involved vehicle crashes, and there were no recorded fleeing driver fatalities.