"It's a matter of simple contract law."
That left National relying on the Greens to get the 61 votes required to pass the legislation.
Prime Minister John Key said he remained confident "that we will find a way through it".
The claim by Mr Peters that National was breaking the law was "a big call", he said, because the issue was currently before the courts.
Green Party co-leader Metiria Turei said her caucus' position was to support the bill. However, she was upset about the Government's lack of consultation with iwi about the sanctuary.
"We think the Government did a terrible thing by neglecting its Treaty obligations so John Key could get his photo op," she said.
Maori fisheries trust Te Ohu Kaimaona was not told about the 620,000sq km sanctuary until two hours before it was revealed in a high-profile event at the United Nations in New York.
The bill passed its first reading with unanimous support in February, before the legal action was launched.