Some tests may be acceptable as early filters, if you have a lot of candidates for one vacancy. But opinion of a reliable employee after personal contact should overpower any test IMHO. It's just crazy how HR blocked the candidate. Also, if they knew he couldn't be with the company, why they even let him into the competition? Strange rules.
And that bit about "special treatment" was kinda stupid, he already had disadvantage cause of bad English.
By they way, in order to get 1% on any test I think you have to know all the right answers and respond conversely.