A LEADING insurer has been told it must shoulder the £2 million plus bill from a welding fire which devastated a well-known engineering works on the outskirts of Burnley.

Homes were cleared and an evacuation centre established at the St Peter’s Centre after a huge blaze at the Summit Works, which took up to 60 firefighters to bring under control in 2010.

MORE TOP STORIES:

The High Court was told the fire was sparked accidentally by mechanic Thomas Holden, who had been repairing his car, ahead of an MoT test, at Phoenix Engineering.

He took a phone call while undertaking some welding and moments later sparks caused flammable materials to ignite.

The resulting blaze gutted the premises and also affected neighbouring outlets like Mills and Scott Kitchens, Hollands Hydroponics, Summit Auto Bodies and Remec Engineering.

Black smoke plumes could be seen across Burnley after rubber gym mats at another firm, Duchamp Solingen, caught fire. Almost Homes were evacuated also.

Mr Holden was not held personally liable for the huge insurance payout which followed, with Phoenix seeking to secure damages from his car insurer, the court heard.

Phoenix’s insurer is AXA, which has paid out more than £2 million to the company and the owner of the adjacent premises.

Lawyers for AXA have then sought to make Mr Holden’s car insurers, UK Insurance Ltd, liable for some or all of the sum.

But UK Insurance resisted the claim and launched a legal action, insisting their policy only covered Mr Holden for third-party claims while the car was being driven on a public road.

Michael Davie QC, for Phoenix Engineering, said the fire arose out of the ‘use’ of Mr Holden’s car, either by just having driven it or because he had just drove it into the garage, or would be driving it afterwards.

But Judge David Waksman QC said: “This is a wholly artificial analysis in my judgment.

“The fire was caused by and arose out of the allegedly negligent repair of the car by the use of grinders and welders without taking any precautions with regard to flammable materials in the car itself.”

Allowing the UK Insurance case and dismissing the Phoenix and AXA counter-claim, the judge added: “The repair being undertaken to this car was clearly not using it. It was not being operated in any way at all but was immobile and indeed partly off the ground so that it could be worked on.”