NEIGHBOURS have told how they launched a desperate search of a smoke-logged building to find a furniture store boss, not knowing he was lying outside badly burned.

Nigel Peacey died in the early hours of Saturday after he suffered almost 90 per cent burns in the fire at the County Durham factory on Friday evening.

It is believed the 58-year-old grandfather had been using an angle grinder to cut a container in his workshop at Priory Pine, in West Auckland, when its contents ignited.

Ronnie Savage, 34, of Copeland Road, said he saw Mr Peacey stagger from the workshop in flames.

He said: "I could not believe what I had seen at first, because he went into the shop.

"I ran over and he was coming back out, so I shouted at him to get on the floor and took my top off to start putting him out."

Mr Savage did not recognise the man as Mr Peacey, so he ran into the smoke-filled building with friend Gareth Moss to look for him.

Mr Savage said: "He was covered in flames, we did not recognise him. We thought Nigel must still be inside and all we could think about was finding him."

Meanwhile Michael and Lynne Radford, also from Station Road, sat with Mr Peacey until paramedics arrived.

Mrs Radford said: "He was very badly burned, but he was so calm. He recognised me as the 'lady over the road' and said thank-you and how kind everyone had been for helping him.

"He also kept asking about Pat, the lady who works there, to make sure she was alright.''

Mr Peacey, a father-of-two, lived with his wife, Linda, at The Grove, Hartlepool.

Yesterday, neighbours were stunned by his death.

Vic Topping, 58, said: "I could not believe it when I found out. He was a smashing bloke.

"He will be sadly missed. He was a good spirit of the community and would go out of his way for people. He never had a nasty word to say about anyone."

Firefighters and police were still at the scene on Saturday morning as investigations into the fire got under way.

A police spokesman said the incident would be investigated by the Health and Safety Executive, but that it was not being treated as suspicious.