Northland MP Winston Peters says Kaitaia police should not have backed off when an errant driver defied them, claiming immunity under Maori sovereignty.
The 51-year-old man had five children in the car, none of them wearing seat belts, refused a breath test.
His car was also displaying illegal sovereignty-style number plates.
Police said all hell broke loose when two officers challenged the man, who reversed into their patrol car and brandished a taiaha - while the children screamed in the back seat.
They judged it best to let the man go but have summonsed him to court for careless driving and refusing to accompany them.
Mr Peters said it was regrettable that police were frightened off.
He said the incident was further evidence that police needed more resources to stamp out such behaviour.