Company fined £400,000 for failure to take proper Fire Precautions

In the recent case of New Look Retailers Ltd. v. The London Fire and Emergency Planning Authority, the Court of Appeal upheld the decision of Southwark Crown Court to impose a fine of £400,000 on NLR for a failure to take proper fire precautions

With effect from 1st October 2005, the Regulatory Reform (Fire Safety) Order 2005 abolished the requirement for business premises to have a Fire Certificate. Instead, the 2005 Order introduced a regime similar to that applicable to health and safety generally. It placed the onus much more squarely upon the individual premises owner to carry out proper risk assessments and implement appropriate fire precautions. The absence of regular inspections by Fire Officers may have tempted some premises owners to downgrade fire safety issues. The NLR case demonstrates that premises owners who fail to take their responsibilities seriously can expect little sympathy from the courts.

NLR is a retailer of fashion clothing for women and children. At the time of the case it operated from approximately 612 shops in the UK and employed 20,000 staff. Its pre-tax profits in 2009 were £200m and its annual turnover was approximately £1bn. One of its shops was situated in Oxford Street in London. One afternoon in April 2009, a serious fire broke out that required the attendance of 30 fire appliances. Approximately 400 people were evacuated. Oxford Street was closed for two days.

NLR pleaded guilty to failing to carry out a proper fire risk assessment and failing to ensure that its employees were provided with adequate safety training. The judge fined them £400,000 and ordered NLR to pay the prosecution's costs. NLR appealed, arguing that the judge had failed to give sufficient weight to the fact that the fire had not been caused by the breaches of duty and that no-one had died or been injured.

Dismissing the appeal, the Court of Appeal ruled that the Judge had not gone wrong in principle. The breaches had been serious and included such matters as an escape route being obstructed by crates of stock, a fire-door that was operated electronically by a swipe-card not being connected to the fire alarm system and an emergency break glass release button that was positioned on the wrong side of a fire-door. All pretty basic stuff you might think. While a number of the issues had been identified in an (inadequate) risk assessment nothing had been done. In the Court of Appeal’s view, in the light of all the circumstances the fines were severe, but they were neither disproportionate to NLR's means nor manifestly excessive.

This case represents a shot across the bows of premises owners. Nor can it be dismissed as an isolated example. In another recent case, Shell International Limited was fined £300,000 for failing to carry out a review of a risk assessment in relation to the Shell-Mex building in London in which about 2,000 people were employed. The courts mean business.

If you would like to know more about your obligations under the Regulatory Reform (Fire Safety) Order 2005, please contact Caroline Wilton or Martin Banham-Hall.

Filed: 16/07/2010 14:44:48