Kensington Close hotel in London has been ordered to pay £47,500 following a gas leak in October 2003.
The four-star property was fined £19,000 by Kensington council and told to pay £28,500 in costs after changing its initial plea of not guilty.
The case relates to a chlorine leak from the plant room that serves the hotel's swimming pool, sauna and spa.
The council said it posed "a serious risk to health" because of its potential to cause an explosion.
According to the prosecution the hotel had failed to act on advice from the company responsible for servicing the plant room, which was to call the fire brigade immediately, after a leak was detected.
Emergency services were only called one day later, at which point the hotel was evacuated.
Follow up inspections also found the chlorine alarm system at the hotel was broken, despite management having been alerted to this 11 months earlier and given a quote for its repair.
Councillor Fiona Buxton, cabinet member for public health and environmental health, said: "This was a very serious incident that could have easily resulted in injuries. The size of the fine imposed on the hotel owners reflects this."
No one was available at the hotel to comment.
By Tom Bill
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