Horse has swollen front knee cap.

First off, I have alot of questions to be answered for my situation. I am leasing a horse, along with two other leasors of the same horse. Already upset with. Too many inexperienced riders. Horse is frustrated. Anyway, horse took bad fall in arena and a bloody nose from another rider about one week ago. Last 3 days, "CHEVY" (the horse), has had front leg knee cap swollen to size of a baseball. I have been icing it daily. Swelling has gone down only a quarter. Owner says that there may be pus that will rid itself overtime or that she needs to inject the knee cap with a needle?? She was in agreement with me about no riding him. But now, she thinks it is okay to lunge him and ride him at a walk and trot. I do not agree. Should I continue the icing of his knee and should she lunge and/or ride him? I feel real sorry for CHEVY and the fact too many riders on a greenbroke 6 yr. Old gelding, in training. Apparently, he ranaway with them in a snaffle bit once, and the other was with a straight bit. I, myself, only ridden him in the arena. He does the"california rolling stop". I have been training him to come to a halt on my command, he is getting better. He is a sweet horse, though. Oh, owner told me that he was lame last year majority of the year.
Thankyou

Doesn't sound good to me. I wouldn't ride the horse, or lunge him until his knee is back to normal. Infections, needles, what is up with that? I would keep icing it, but I would also be looking to end my lease, this horse is being misused from the sounds of it.