Farmers may have been incorrectly paid for their chickens by Tegel Foods after a weighing specialist company used the wrong part to fix the poultry producer's weighbridge.
Precia Molen was in New Plymouth District Court on Friday facing a rare prosecution under the Weights and Measures Act 1987, brought by the Ministry of Business, Innovation and Employment (MBIE).
The Hamilton company is accredited to undertake certain functions as an inspector of weights and measures, including the testing, weighing and measuring of instruments to ensure compliance with the Act.
The company's admitted offending arose from a repair to a road weighbridge, used for weighing trucks carrying chickens into the factory, at Tegel Foods in New Plymouth in June 2020.
Tegel, a major employer in New Plymouth, had been experiencing problems with the machine for some weeks.
Precia Molen undertook the repair, fitting four load cells to the machine.
The certificate of approval for the weighbridge only allowed for the fitting of a particular type of compression load cells, it was heard.
But Precia Molen had used one unapproved load cell, in addition to three of the approved, and then issued a certificate of accuracy in relation to the weighbridge.
Tegel continued to experience problems with the machine, which was not accurately recording weights.
Another accredited company was later called to assess the weighbridge and revealed Precia Molen had used an unapproved load cell.
In court, Alistair Miller, lawyer for MBIE, said the company's actions were premeditated and serious.
He said Precia Molen had also opened Tegel up to potential criminal liability.
"Due to the fact that the weighbridge is not compliant it is possible it was producing short weights itself which would have flow-on effects to the chicken growers who rely on the accuracy and so forth of the weighbridge for what they need to be paid."
A prosecution had not been brought under the Act for more than a decade, Miller said.
"The ministry does have other enforcement tools available to it for breaches of this legislation however the breach, in this case, was deemed so serious that a prosecution was viewed as warranted," he said.
But despite the breach, Precia Molen had not yet lost its accreditation.
One of the company's directors, Atish Narayan, travelled from Hamilton to appear at the hearing.
He told the court that Precia Molen had already reimbursed Tegel $23,000 for its failures, which was over and above the costs of performing the work.
Narayan said the company had made a mistake and would accept any fine imposed.
"It is what it is, we accept it and I'm not going to argue about it," he said.
"We made a mistake and we will pay for it."
Judge Tony Greig said the purpose of the Act was to contribute to a trading environment that protects the interests of consumers and allows businesses to compete effectively.
Consistent with the Act, an accreditation scheme was created to protect and promote the interests of consumers and businesses in trade, he said.
When accredited persons, entrusted by the regulator to perform certain duties to support the trade infrastructure in New Zealand, including testing and accuracy checks, breach their accreditation it undermines the scheme and damages public confidence in consumer protections, Judge Greig said.
He described Precia Molen's actions as deliberate and imposed a fine of $11,500.
Judge Greig further warned the company's accreditation may be at risk.