THE judge who handed the owners of Cameron House a £500,000 fine for the safety violations that led to the deaths of two guests in the 2017 fire has hit out at the hotel's approach to fire safety.

Sheriff William Gallacher said the reaction of the hotel's management to the advice they were given on fire safety measures – in particular for dealing with combustible materials in the concierge cupboard where the fire started – was "ill-focused, unsatisfactory and ineffective".

He said he "did not regard it as acceptable that advice was given by fire assessors that a written set of procedures should be developed for dealing with the ashes and embers from the fire, and that this was not done".

Sheriff Gallacher also told Christopher O'Malley, whose actions in putting hot ashes into a plastic bag and placing it in the concierge cupboard directly led to the fire that killed guests Simon Midgley and Richard Dyson, that he accepted the 35-year-old, from Renton, had no intention of causing the blaze.

READ MORE: Cameron House's owners fined £500,000 for safety breaches that led to deaths of two guests – while night porter is spared jail

Handing O'Malley a community payback order with 300 hours of unpaid work, as a direct alternative to prison, the sheriff said: "I accept that you did not think that your actions could have led to the catastrophe which followed."

Sheriff Gallacher's full sentencing statements are as follows.

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To Christopher O'Malley:

“You have pleaded guilty to an offence in terms of the Health and Safety at Work Act, in relation to the obligation on any employee to take reasonable care for the health and safety of other persons affected by their acts or omissions at work.

"Your acts on 18 December 2017 caused a fire to start in a cupboard in Cameron House Hotel at Loch Lomond. The fire developed from that cupboard and spread to many parts of the building. The building required to be evacuated. Some guests were able to do that with relative ease. Some found it more difficult, including those who had to crawl along a corridor to try to avoid the smoke and fumes, and others who had to be rescued by ladder by the Scottish Fire and Rescue Service (SFRS) from a balcony of their room. No doubt, some of those who experienced these traumatic events will be affected by them for a long time to come.

"Two others, Simon Midgley and Richard John Dyson, were unable to escape from the effects of the fire and, as a consequence of inhaling smoke and fire gases, tragically lost their lives. Their families will always endure the heartbreak caused by that and their presence here today, and on other occasions, whether directly or remotely, demonstrates the continuing loss which they feel and the importance which they attach to these proceedings.

Christopher OMalley arrives at court for sentencing (Photo - Andrew Milligan/PA Wire)

Christopher O'Malley arrives at court for sentencing (Photo - Andrew Milligan/PA Wire)

"It is clear that it was your action which was the cause of the start of the fire. I accept that you had no intention of causing the fire. I accept that you did not think that your actions could have led to the catastrophe which followed.

"I accept that you had not been given adequate training in relation to the procedures which should be taken in relation to disposing of the ash and any other materials which were produced by the open fire. You did however have responsibility for the cleaning and safe disposal of it.

"I accept from what I heard that you were in the habit of using outside bins which had been designed and prepared for that purpose. I accept that on this occasion you were already aware that those bins were full and I understand had not been emptied for some weeks prior to this date. I accept that there was no written instruction available for you as to what should be done with the materials. I accept that you were not guided by any manager on the premises as to the appropriate course of action which should follow.

"In fact, what you did with the material which you removed from the fire near the main reception for the hotel was to put the ash and embers into a plastic refuse bag, which you then placed on the floor of the concierge cupboard on the main entrance floor of the hotel.

"Some few hours later initial warnings were given that a fire was developing. You and others made vain attempts to address the fire which had already developed in the cupboard, and I saw video recording images of what the scene was in that area of the hotel. Tragically, what had also happened was that smoke and other gases had spread from there throughout the rest of the hotel, resulting in the difficult situation for some residents and the catastrophic outcome so far as related to Mr Midgley and Mr Dyson.

"In considering the appropriate penalty which I must impose, I have regard to provisions of the statute which indicates that, for the offence to which you have pled guilty, the maximum sentence may be a period of imprisonment not exceeding two years. Had it been that you had been given specific instructions and were failing to comply with them; had it been that you had taken a course of action which deliberately disregarded the safety of others; had it been that you had a history of criminal offending, and particularly offending showing disregard for others; I would have considered it inevitable that a custodial sentence would be imposed. I have also had regard to the guidelines produced by the English Sentencing Council in respect of offences of this type to which I was today referred by your counsel and which assist me in determining the appropriate sentence.

A picture taken from a drone showing the damage to the hotel (Photo - Crown Office)

A picture taken from a drone showing the damage to the hotel (Photo - Crown Office)

"In the event, taking account of your personal circumstances, taking account of your lack of criminal history, and all that I have read about you in the social work report and heard on your behalf, including the character reference submitted on your behalf, and considering also that you have accepted your responsibility and pled guilty to this offence at the earliest opportunity that was available to you, I consider that I can avoid the imposition of a custodial sentence.

"That is, of course, not any attempt by the court to diminish the tragedy which occurred here, nor is it any indication that the court undervalues the distress caused to residents in the hotel, and to other staff, and the tragic loss of life of Mr Midgley and Mr Dyson, or the enduring loss and sorrow experienced by their families and friends. It is rather a recognition that it was not remotely in your contemplation that anything you did on 17 or 18 December would have led to the catastrophe which in fact ensued.

"It seems from what I have considered that it would be appropriate for you to be subject to supervision for a period of time, and if you agree to this, and comply with the instructions of your supervising officer, I will make you subject to a Community Payback Order, where you will be under supervision for a period of 18 months from today’s date.

"You will also give back to the community in general. I do not seek in these proceedings to provide any means by which you could give back directly to those who suffered and sustained loss. Rather, you will give back to the community, and you will carry out 300 hours of unpaid work.

"I have not reduced that number from the statutory maximum, since I consider the discount in sentence which your early plea entitles you is afforded to you by reducing the penalty from a custodial to non-custodial sentence.

"You will complete those hours within 12 months of today, but more importantly you will attend or participate in meetings with your supervisor when required to do so, and will attend to complete the hours of unpaid work when directed to do so. This is a clear alternative to a custodial sentence.”

The damage to the hotel was so severe that it was months before a full investigation coulld begin (Photo - Crown Office)

The damage to the hotel was so severe that it was months before a full investigation coulld begin (Photo - Crown Office)

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To Cameron House Resort (Loch Lomond) Limited:

“The accused company is the owner and operator of Cameron House Hotel at Loch Lomond, and pled guilty on indictment in relation to two separate offences in terms of the Fire (Scotland) Act 2005. The offences are, to a large measure, identical, but specify the provisions of the Act dealing with employees and others for whom the company had an obligation to take such fire safety measures as were reasonable.

"In the main, these others were the hotel guests. The consequences of a fire which took place at Cameron House Hotel on 18 December 2017 were significant in relation to fire damage to the structure of the hotel. The events were inevitably alarming and harmful to all those present on the premises, including many guests as well as staff. The outcome was catastrophic for two guests, Simon Midgley and Richard Dyson, who, as a consequence of the smoke and gases produced by the fire, were unable to escape from the premises, and tragically lost their lives.

"One employee, a night porter at the premises, has also pled guilty to an offence concerning the fire, where he accepted responsibility that he failed to take reasonable care of the health and safety of persons affected by his acts, including the guests of the hotel.

"It was his act that, after he had cleared ashes and embers from a log fire in the reception area, he left these in a polythene bag in a cupboard. Some time shortly thereafter, these ashes and embers ignited a fire, which began in the cupboard and then spread to the rest of the hotel.

"An examination of the tragic circumstances appropriately, and inevitably, focused on the way in which the company conducted its business, and in particular whether it had regard to health and safety legislation in general, and in particular the obligations imposed by the Fire (Scotland) Act 2005. The company was obligated to take fire safety measures necessary to ensure the safety of employees, and separately to take such measures which were reasonable for the company to take to ensure the safety of hotel guests.

"The company have pled guilty to the indictment before me in respect of failures in three separate ways. Firstly, that they failed to have a safe system of work in respect of removal and disposal of ashes and embers from fires, including that metal bins which came to be used for the storage and disposal of the ashes were properly maintained and emptied; secondly, that they failed to ensure that employees were given instruction, training and supervision in the safe removal and disposal of the ash and embers; and thirdly, that they failed to keep cupboards containing potential ignition sources free of combustibles.

Fire crews tackle the blaze at Cameron House on December 18, 2017 (Photo - Jamie Simpson)

Fire crews tackle the blaze at Cameron House on December 18, 2017 (Photo - Jamie Simpson)

"In essence, the night porter had never been told how he should gather the ashes and embers and where he should put them. Metal bins at the rear of the premises, which were routinely used and which would have provided for safe disposal, were, on 18 December, already full, and the night porter knew this. The arrangement for the provision of these bins was not effectively organised and structured, and whatever limited arrangement had been in place had ceased to function as far back as October in 2017.

"In 2016, fire risk assessors, who were properly and appropriately instructed by the company to make an assessment of the fire risks in the hotel, observed that there was no written policy covering the emptying of the open fires. A clear recommendation was made that a written policy should be developed, which could then have been made available to all employees and others.

"I was told that the resort manager of the company delegated this recommendation to the deputy general manager of the hotel. That individual did not delegate the preparation of a written procedure to anyone else due to, what I was told, his apparent understanding that there was not an issue involved in relation to removal of hot ashes. I do not consider that it is only hindsight that would have led to the obvious conclusion that that approach was flawed.

"In any event, at a further assessment in 2017, the same fire assessors highlighted that the written procedure, which they had earlier recommended, had still not been implemented. For reasons which I cannot grasp, this situation was challenged by the resort manager and a risk and safety manager. Such was their influence in challenging it that the fire safety assessors succumbed and produced a revised report.

"I am told that the situation proceeded on the basis that the resort manager had made a wrong assumption that such a procedure was properly in place. I do not understand why the simple and obvious course of action of obtaining and considering the recommended written procedure was not the course of action taken, rather than a senior member of staff making assumptions.

"In the absence of any formal procedure, individual members of staff had no option but to deal with matters as they thought best. The indictment, in addition to the events of 18 December leading to the fire, make reference also to events of 15 December, when night porters removed ash and embers from fires and put these into polythene bags containing water. This was not an appropriate course of action.

"A more senior member of staff castigated these members of staff for acting in this way. Tragically, what did not follow from that was a proper consideration of why the staff members were acting as they did by reference to what should have been an appropriate safe system. No additional instructions were given to staff at that stage, nor was the absence of any written set of instructions highlighted.

The fire devastated large parts of the main hotel building (Photo - Crown Office)

The fire devastated large parts of the main hotel building (Photo - Crown Office)

"In relation to the removal of ash and embers from the hotel building and their deposit in metal bins outside the premises there was clearly information that this was a habitual course of action for staff members and indeed the night porter, who on 18 December put the bag in the cupboard was aware, in advance, that the metal bins at the rear of the premises were full and unable to store more ashes.

"That the provision in relation to these bins, their maintenance and emptying, was entirely reliant on communications between individuals simply doing what they thought best, and the fact that a change in a particular employee resulted in what practice there was simply stopping, illustrates to me, and in my view ought to have illustrated to anyone who had appropriate regard to the fire safety of the premises, that the whole regime ought to have been the subject of proper and managed attention.

"The other essential and catastrophic element which materially influenced the development of the fire was that the cupboard in which the employee placed the ashes and embers had within it kindling, cardboard and newspapers, all of which are readily combustible and contributed to the fire taking hold in the cupboard and developing from there. The culpability of the company arises from that general situation, which illustrated an unsafe system of work, amplified by the fact that on two occasions earlier in 2017, the Scottish Fire and Rescue Service (SFRS), in fulfilling their statutory responsibilities in relation to fire safety, carried out an audit of the hotel, and highlighted that these materials were stored in this cupboard which had another source of potential ignition of fire, in the form of an electrical installation apparatus.

"Informed by that, the Fire and Rescue Service directed that it was unacceptable to have combustible material stored adjacent to a potential source of ignition. That instruction also made clear the danger of fire spreading rapidly through the building due to its age and highlighting that, because of the threat of voids in the structure, smoke and gases could spread in an irregular way. While some action was taken by the company in response to this, the action was ill-focused, unsatisfactory and ineffective.

"In respect of the materials in the cupboard, I was told that assurances were given to SFRS in August 2017 that the combustibles would be removed from the cupboard. I was advised that the resort manager brought this issue to the attention of the relevant managers in the premises but in doing so, regrettably, and in my view unacceptably, omitted reference to the fire risk of storage of combustibles. It simply narrated "concierge cupboard to be tidied…"

"The issue was specifically raised again in November 2017, in a letter addressed to the resort manager by the Scottish Fire and Rescue Service. That included the full findings of the audit in 2017. The task of dealing with combustibles in the cupboard was again delegated, in this case, to the general manager of the premises who himself, appropriately, examined the cupboard and noticed combustible materials, mainly newspapers, on a shelf adjacent to the electrical installation apparatus which had been identified by SFRS as a potential source of ignition of fire.

A drone picture of the hotel after the fire (Photo - Crown Office)

A drone picture of the hotel after the fire (Photo - Crown Office)

"Appropriately again, he took photographs of this, and conveyed these with an email to staff with the instruction “can you make safe and speak to team, highlighted previously by fire safety inspection and evidently still an issue”. Superficial importance was given to the issue, because later in the day the general manager spoke to the assistant head concierge, but did nothing other than request that the newspapers be removed and that the shelf in the cupboard be kept clear.

"A request was made back to the general manager whether newspapers could be stored on the floor in the cupboard, and permission was given. It is clear that the general manager’s general comment “make safe” was diluted and translated simply to an exercise of tidying, and not removing the sort of combustible materials which, since they remained present on 18 December, allowed the catastrophic fire to take hold and develop. There were, I was told, repeated instances of leaflets, kindling, newspapers and other materials being in the cupboard and, in particular on 16 December, I understand that four bags of kindling were deposited in the cupboard.

"On behalf of the company, I was told that the events set out in the indictment were a matter of concern and remorse in equal measure. I was asked to accept that the organisation took its general health and safety responsibilities very seriously, and to illustrate that, I was told that a director of the company had personally attended court, even in the context of the present Covid regulations. It was emphasised that the company sought annual assessments by appropriate fire assessors as part of the general compliance with health and safety legislation, and it was suggested to me that “a detailed suite of measures” were in place designed to address the various risks that might exist and which had to be guarded against.

"I was told that there was, in addition, a process for monitoring and auditing the fire safety regime. Emphasis was placed on the fact that, in general, comments had been made by those who were carrying out assessments of the hotel, which highlighted their general perspective that the hotel promoted a positive health and safety culture and that, in general, it was accepted that the company were complying with guidance or recommendations which had been given. Employees of the premises also supported the general perspective that there was compliance.

"It was emphasised that the failings which did occur, notwithstanding the arrangements which were in place, were not as a result of a deliberate breach, but occurred as a result of a combination of errors and misinterpretation by individuals who were, nevertheless, endeavouring to ensure that the fire safety measures were implemented effectively.

"So far as the charges are concerned, it was accepted that there was no written procedure for the disposal of ash and embers, and that the absence of that procedure provided the opportunity (in my view, the necessity) for those responsible to improvise. This, I was told, arose from assumptions wrongly made by the resort manager.

The families of fire victims Richard Dyson and Simon Midgley watched Fridays court proceedings remotely or in person

The families of fire victims Richard Dyson and Simon Midgley watched Friday's court proceedings remotely or in person

"However difficult it might be to understand the conduct of the night porter in depositing the plastic bag with ashes in the cupboard, it was nevertheless accepted that if a formal procedure had been in place, the risk of individuals improvising, or indeed behaving inappropriately, would have been addressed.

"In respect of the clearance of the cupboard, it was emphasised to me that the hazard being guarded against was that of an electrical fire, not of something arising from anything else. It was suggested that it was in that context that attention focussed on the shelf where the electrical fitting was located, and that shelf was cleared, and there was no evidence that thereafter the particular shelf itself was not kept clear. Again I was asked to conclude that this was a genuine misinterpretation of the situation.

"To a significant extent, I accept what was said about the overall regime which was in place in the hotel, and I accept that in any large operation, such as a hotel, a whole range of health and safety measures in general, and fire measures in particular required to be developed and deployed. It was quite appropriate for these to be informed and guided by specific specialists, and it was also inevitable the Scottish Fire and Rescue Service would contribute in terms of their statutory obligation.

"I do not consider that the company simply disregarded advice or recommendations, but rather that inputs of this sort were translated or interpreted wrongly or incompletely, and that, as eventually passed on to those whose actions mattered, the obligations or the means by how these were best to be met were unclear or ill focussed. Counsel confirmed that a system of auditing was appropriate and necessary, and was in place, but, in my view, it is in this area potentially the greatest deficiencies were apparent.

"I simply did not regard it as acceptable that advice was given by fire assessors that a written set of procedures should be developed for dealing with the ashes and embers from the fire, and that this was not done.

"Worse, on a future review, the fact that that had not been done was again highlighted, but senior representatives of the company made the assumption that the situation described was wrong, without obtaining and referring to the written guidance which had been recommended. Such a course could have been undertaken very easily. Had that been undertaken, then much of what happened on 18 December could not have occurred.

The full ash bins at the rear of the hotel (Photo - Crown Office)

The full ash bins at the rear of the hotel (Photo - Crown Office)

"The regime in respect of the emptying of the bins, and the reliance on a particular member of staff, was also, in my view, quite bizarre, and of course, had a written set of instructions been in place, then that would also have been clarified and staff identified to undertake the necessary duties. That the habitual measures, which seemed to have been safe, fell away simply because of the change of head groundsman, is and ought to have been alarming to anyone effectively monitoring the system of work which should have been in place.

"The comments made in August 2017 by the Scottish Fire and Rescue Service in respect of the storage of combustible materials in the cupboard could not have been clearer. The fact that a statement that it was “unacceptable to have combustibles stored adjacent to a source of ignition” become translated to an instruction: “Concierge Cupboard to be tidied…” is unacceptable, and while I cannot, nor need not, determine whether the resort manager did not understand the fire safety implications of failing to explain the reasons why removal of combustibles was necessary, it was inevitable that those to whom the instruction was issued could not have had the fire safety implications as their guiding context.

"The later exchanges between the general manager and the head concierge about storing newspapers on the floor rather than on the shelf beside the electrical box also indicated the disastrous departure from the fire safety imperative of removing all combustibles from the cupboard. It was very clear that this cupboard was a convenience to the concierge staff, where they had ready access to materials which were useful to lighting the fires in the reception area or in the restaurant. It was also the location where the fire first ignited, and it was from there that, because of the voids and unusual structure of the building, it was able to spread so rapidly outside the confines of that cupboard, by which point it was impossible for the fire to be controlled.

"I was further addressed that the company had taken steps to cooperate entirely with the investigation and, in terms of the refurbishment in advance of the reopening of the hotel, significant steps have been taken to improve the general fire regime, together with an intensive programme of training of the individuals involved. I am content to accept these circumstances in mitigation, in relation to the responsibility of the company.

"Counsel for Cameron House Resort Limited very properly directed me to guidelines prepared by the English Sentencing Council, in respect of breaches of duties by employers or occupiers of premises towards their employees, or others, in terms of the health and safety regulations. Decisions by the High Court in Scotland have confirmed that it is appropriate for Scottish courts to have reference to these guidelines. I was told that there was no specific guidance in relation to the Fire (Scotland) Act, but it was accepted, both by counsel for the accused and by the advocate depute, that the guidelines in relation to health and safety would equally apply in relation to the Fire (Scotland) Act, in relation to safety measures concerning fires.

"Inevitably, reference to these guidelines involves a series of assessments and measurements in relation to a range of options, which are set out in writing and in tables, and which involve allocations of particular figures of calculation in grids, with reference to increasing and diminishing figures applicable to concepts of culpability and of seriousness of harm and the likelihood of harm.

Dumbarton Sheriff Court, where Christopher OMalley and Cameron Houses owners admitted safety breaches that led to the deaths of Simon Midgley and Richard Dyson

Dumbarton Sheriff Court, where Christopher O'Malley and Cameron House's owners admitted safety breaches that led to the deaths of Simon Midgley and Richard Dyson

"At the hearing of this case on 22 January I sought to indicate to the family of Simon Midgley, who were present in court, and repeat to them today, and to the family of Richard Dyson observing remotely, that the exercise of using guidelines is not any attempt to evaluate a personal catastrophe or loss by reference to such a grid of figures.

"I extend my comments to those others who were present in the hotel, and who may have sustained injury from the smoke and fire gases in the premises, and who will, to a greater or lesser extent, have been affected by the trauma of the fire, and for guests of being evacuated from the comfort and safety of their room. It is simply a helpful and practical means to give assistance to courts in applying penalties and sentences on a consistent basis.

"That having been said, counsel made appropriate submissions on how I should view the guidelines, and the application of those guidelines to the present case. It is not, I think, fundamental in delivering this statement today that I proceed through the details of the guidelines themselves, nor indeed counsel’s submissions. I add only that the advocate depute quite properly suggested that I should take a different approach and place the level of culpability and the likelihood of harm in different categories.

"As I understand things, I should have regard to these guidelines, but I should not seek to use them in a mechanistic or formulaic way. I do not consider that they can or should be seen to provide an exact arithmetical process by which the appropriate disposal can be calculated. Neither counsel nor the advocate depute referred me to specific cases in Scotland in respect of any guidance on an appropriate penalty in this case. I have considered the general guidance of the Court in Scottish Power Generation Ltd v HMA in 2016, but I am unaware of any directly comparable Scottish case.

"Whilst not here developing matters in detail, I was asked by counsel on behalf of the accused company to consider that the level of culpability was 'medium'. That was on the basis that I should not conclude that there was a serious or systemic failure within the organisation to address risks. The advocate depute suggested a contrary view and that I should see the culpability level as 'high'.

"The individual descriptions in the guidelines suggest that within the categorisation of high culpability, “ignoring concerns raised by… others” and “allowing breaches to persist over a long period of time” ought to categorise the level of culpability as high. In my view, the true level of culpability might be described as at the lower end of high, or the higher end of medium.

The ash bins were full on the night of the fire and had not been emptied since October (Photo - Crown Office)

The ash bins were full on the night of the fire and had not been emptied since October (Photo - Crown Office)

"Counsel then turned to assessment of the level of harm, and recognised that the deaths which arose reflected a 'level A' in terms of seriousness of the harm risked. He suggested that the failures of the company, when objectively assessed and, setting aside for this purpose the tragic consequences which in fact arose, properly indicated nothing higher than a medium likelihood of harm.

"He went on to accept that in considering that deaths had occurred, and that, including employees and guests, significant number of people were exposed, which may properly elevate the placement in the penalty calculation, with the effect being to increase the allocated harm category identified in the appropriate table, or alternatively to move the level of penalty up within the original range.

"Counsel accepted that at the conclusion of the process of allocating the various measures to places in tables, I had an overriding obligation to consider the general purpose of fire safety legislation, and further accepted the terms of the guidance, that in setting the level of a fine it must be “sufficiently substantial to have a real economic impact which will bring home to both management and shareholders the need to comply with health and safety legislation”.

"In assessing the financial position of the company, counsel properly recognised that I should not have regard to the turnover and profit and loss figures only for the years subsequent to the fire (which of course were markedly reduced), but should have regard to the figures in advance of that, and he properly made appropriate accounts to me. He was also able to indicate to me the expectation in relation to turnover in the current financial year, should it be that the hotel is able to reopen as anticipated.

"In that respect he suggested the figure may have been in the order of about £15 million. While accepting that may not be very far removed, I observe that the process of renovation and rebuilding of the hotel has increased the capacity of the hotel, and it may be realistic to anticipate that turnover would also increase from the pre-fire situation – although the extent by which that will happen is very difficult, if not impossible, to determine at this stage. Using the relevant figures fits the description in the guidance of a medium sized organisation, which is an organisation of a turnover between £10 million and £50 million.

"In concluding his submissions in relation to the guidance, I was asked to consider that none of the aggravating factors set out were present, whereas all of the mitigating factors were evident in relation to the actions of the company, at the time and thereafter.

The shocking scale of the internal damage to the hotel (Photo - Crown Office)

The shocking scale of the internal damage to the hotel (Photo - Crown Office)

"The advocate depute made some additional comments in relation to the applicability of the guidelines, and, as I have already indicated, where I should place the company in terms of the appropriate grids and guidance.

"As I have indicated, I do not consider that the deaths which arose, the harm which affected significant people then and still, [and] the passage of time over which these identifiable failures of fire safety had arisen, in circumstances where the company were alerted by two separate expert advisers, would justify me in simply leaving the matter in the range of penalties set out for medium culpability with level 2 harm category.

"I do not, however, completely discount submissions made by counsel as to the overall extent of the company’s arrangement in relation to fire safety as part of health and safety provision. I also specifically take account of the absence of any aggravating features as described in the Sentencing Guidelines, and the inclusion of all the mitigating features. I include in my assessment the financial information given to me in terms of turnover and profit.

"I also have regard to the fact that the company had appropriate fire insurance to allow the rebuilding of the hotel, that they had occupier liability insurance which will deal with any civil action which might arise from these tragic events, and also had profit insurance, the result of which is likely to be that the company will not have sustained the significant losses in relation to their income which might otherwise have happened. In these circumstances, the obligation of making any fine sufficiently substantial to have real economic impact in my view requires that the penalty move up rather than down.

"In all of these circumstances therefore I consider that the appropriate penalty which I ought to impose in relation to both charges would have been a fine of £750,000. Since the plea was tendered by section 76 procedure, and accepted by the advocate depute as being a plea tendered in line with discussions from an early point, and where, had the matter proceeded to trial, this would, in all likelihood, have been a lengthy and potentially complex trial involving many witnesses, from a variety of locations and many expert witnesses, I consider that it is appropriate to afford the company a discount in the order of one third from that penalty.

"I will therefore impose a fine of £500,000.”

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