Two days later she was examined again and told she was in early labour.
The following day the midwife started monitoring the unborn baby's heart rate, which she did not interpret as significantly abnormal, the HDC said.
It wasn't until an hour later when a second midwife, after being asked for her advice on a small amount of yellow-green discharge, discovered the child's heart rate scans were abnormal.
The HDC ruled that the midwife, whose name has been suppressed, breached the Code of Health and Disability Services Consumers' Rights "in several respects".
As well as missing the abnormal test results, the HDC said the midwife also "should have monitored the fetal growth more closely" because the child's mother continued to smoke throughout her pregnancy and was subsequently at higher than normal risk of having an underweight baby.
"The woman also had a long period of latent labour and ... the midwife should have assessed her more thoroughly," the HDC said.
"The midwife also failed to document her antenatal care adequately."
The midwife was ordered to repeat an education program, however she told the HDC she had "decided to cease practising midwifery and will not be renewing her practising certificate".
She was ordered to write an apology to the mother.