A timber laminate firm near Nelson has been fined $270,000 for burning treated timber without a consent that released toxins into the air.
In the environment court in Nelson last week, the offending by Hunter Laminates 2014 Limited was described as "deliberate and serious".
The charge, brought by Tasman District Council, was in relation to the illegal burning of timber - treated with copper-chrome-arsenate - from Hunter's industrial premises in Richmond.
The main contaminant contained in the emissions was arsenic, which is classified as a non-threshold, high potency carcinogen.
Homes, schools and recreational areas near Hunter's premises were most likely affected by the toxic emissions.
Neighbouring businesses in Richmond began noticing problems in 2014, the summary of facts showed.
The council said it received two complaints from one nearby business in August that year and again in February 2016.
The first complaint was in relation to wood dust and ash being discharged over the property's boundary.
An inspection at Hunters revealed a hole in the cyclone filter system close to the property boundary which may have been allowing wood dust to escape, and it was fixed by Hunters.
The second complaint was around the discharge of wood shavings and soot, causing a nuisance over the property boundary.
The summary of facts said the wood chip and soot in the air appeared to be caused by a large storm the previous night and Hunters cleaned up the affected properties the following day.
A sample of the wood, dust and soot taken by the council showed there was arsenic, chromium and copper in both the unburnt wood chip and the burnt ash.
The fabricated wood manufacturing business did not hold a resource consent for any discharge to air activity on the property.
Over the next couple of years, the council regularly monitored air quality in Richmond and an industrial source of pollution was detected.
A council enforcement officer inspected the boiler at Hunters in August 2016 and found arsenic, chromium and copper, indicating the burning of treated timber.
The public were advised and Hunters asked to hand over a copy of compliance records.
New ash was found in the boiler by council in January last year and two months later, certificates of inspection handed to the council by the firm's lawyer showed incomplete records that did not comply with the requirements of a list of rules.
In the summary of facts, one staff member said there was a "culture of denying the burning of treated timber to council".
The factory has been in operation since 1985.
The company argued it was sporadic and unintentional, but insurers are now seeking to recover defence costs, after it was discovered that one employee and possibly two company directors were aware that treated timber was being burned.
The insurer is named as an unsecured creditor after the company was placed in liquidation in April this year.