Mr Moorhouse called for police assistance at about 8.30pm.
The police canine unit was dispatched and about six police staff arrived prepared to cordon off the area, near the intersection of Nelson and Frederick streets, Mahora.
"Two men were initially taken into custody to determine which one was using the knife."
Mr Moorhouse said one of the men was arrested and would face charges in the Hastings District Court this morning, relating to the incident. He said the offender did "smack another police officer in the face", so assault could be among the charges.