They said he had tried to escape custody as officers attempted to escort him to a police station.
After being caught again with the use of capsicum spray, Mr Paterson was remanded in custody for six days until his release on bail before his pending October court appearance.
It was also alleged Mr Paterson stabbed a police officer in the hand with a pen, court documents said.
He was charged with serious assault on police, escaping lawful custody, drug driving and unlicensed driving.
Last Friday his charges were finalised in the Cairns Magistrates Court.
The alleged offences were withdrawn after police offered no evidence following his death.
"Accordingly the charges are struck out and Mr Paterson is discharged ... as he is deceased," Magistrate Robert Spencer told The Cairns Post.
Cairns local David Leslie Hickson, 32, was charged with Mr Paterson's murder and interference with a corpse.
Police had executed a search warrant at his Cairns home after the discovery of Mr Paterson's body.
Queensland police said the crimes were alleged to have occurred on November 7.
Hickson was remanded in custody.
He will appear before the court again on December 17.
Police identified the body in the chilly bin as Mr Paterson's last week, while undergoing ID confirmation using DNA testing at the John Tonge mortuary in Brisbane.
To help with the costs of returning Mr Paterson's body, his Napier-based family raised nearly $5000 via the Give a Little website, in an effort to give him the "tangi he deserves".
It is understood Mr Paterson's tangi was held yesterday in Napier.