(Adds police comment, criticism, paragraphs 12-16)
By Colin Packham
SYDNEY, May 24 (Reuters) - Australian police failed to respond quickly enough to the threat posed by a gunman responsible for a siege at a Sydney cafe in 2014 in which three people including the hostage-taker were killed, a coroner said on Wednesday.
While attributing blame for the deaths of Lindt Chocolate Cafe manager Tori Johnson and lawyer Katrina Dawson to gunman Man Haron Monis, New South Wales Coroner Michael Barnes said police should have acted promptly after Monis fired a warning shot.
Monis killed Johnson shortly after that.
Dawson was killed by fragments of a bullet fired by police after they stormed the cafe in the city's central business district 10 minutes after the gunman fired the warning shot.
Monis was killed by police fire.
"The 10 minutes that lapsed without decisive action by police was too long," Barnes said in a finding handed down after two years of testimony.
The siege, which began on Dec. 15, 2014, was Australia's most deadly violence inspired by Islamic State militants.
Questions have been raised every since about the police strategy of "contain and negotiate" that saw the standoff last for more than 16 hours.
While concluding the strategy was appropriate at the beginning, Barnes said the police had an incomplete picture of the threat posed by Monis and they placed too much emphasis on the advice of a psychologist and the incorrect belief that negotiations were progressing.
Barnes recommended authorities reconsider their response to such attacks.
"The outcome of the Lindt cafe siege suggests that contain and negotiate strategy needs to be more rigorously assessed in the context of terrorist incidents," Barnes said.
Mick Fuller, commissioner of the New South Wales Police that oversaw the siege response, said police would be more prepared to storm a terror-related hostage situation in future.
"'Contain and negotiate' has saved many lives but if it is a terrorist incident, a deliberate action will be something that we consider," Fuller told journalists.
"The great challenge is that we need to tell people that a deliberate action may not mean less lives are lost, it just may be different ones. The outcome of the Lindt cafe siege suggests that 'contain and negotiate' strategy needs to be more rigorously assessed in the context of terrorist incidents."
Friends and family members of the victims were also critical of the police.
"We were confronted with systematic failures of various authorities who at times were confused, ill informed, unprepared and under-resourced to deal with Man Monis throughout the process and later on during the siege," Thomas Zinn, the partner of Johnson, told reporters.
Australia, a staunch ally of the United States and its escalating action against Islamic State in Syria and Iraq, has been on high alert for attacks by home-grown militants returning from fighting in the Middle East or their supporters. (Editing by Robert Birsel and Nick Macfie)