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It’s crunch time for unfair gym contracts

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Woman doing crunches in the gym
Profile photo of Patrick Steen Patrick Steen Conversation Editor
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Are gym contracts stacked against you if you want to cancel? The OFT is threatening to crack down on gyms after complaints that contracts unfairly lock customers in.

A story about how a couple tried to cancel an LA Fitness contract caught the attention of gym members across the country last week. Published in the Guardian’s consumer champions section, the story of the seven months pregnant Hannah and her attempt to cancel her two-year gym contract struck a chord.

Her husband had recently lost his job, leaving the couple on benefits. To top it all, the sale of their house fell through, meaning they were at risk of being made homeless. Paying to keep fit wasn’t really at the top of their priorities.

Despite the couple and the Guardian arguing on legal and compassionate grounds, it took six weeks for LA Fitness to agree to take six months off the 15 months left on their contract. This still left them with £360 to pay.

After Guardian readers offered to pay the rest of Hannah’s fees, and started cancelling their own LA Fitness memberships, that the gym caved in. In a statement, LA Fitness said:

‘We appreciate that their circumstances have changed dramatically since they first signed with us, and on this occasion we will waiver any further membership fees with immediate effect.’

Can the OFT ‘work out’ how to fix gym contracts?

Phew. That’s a lot of effort to get out of a gym contract, especially when the couple so clearly couldn’t afford it. But they’re not the only ones – the Office of Fair Trading (OFT) has received a massive 1,500 complaints about gym contracts in the four months to December 2011.

Yes, I know, we’re the ones who signed on the dotted line, but it seems that we might have good reason to say that some gym contracts are unfair. When the Guardian asked Which? lawyers about Hannah’s particular case, they pointed to last year’s ruling against Ashbourne Management Services, a company that draws up gym contracts.

Ashbourne repeatedly said that gym goers couldn’t cancel their contracts, but judge Mr Justice Kitchin concluded that in contracts over 12 months, gym goers should be able to give 30 days notice (and a moderate sum of compensation) to cancel.

This ruling only applied to Ashbourne contracts, but the OFT has said it’s going to start clamping down on the rest of the gym industry, where long-term contracts appear to be unfairly weighed against consumers.

Stuck on the gym contract treadmill?

My own situation is too embarrassing to go in to in detail, but I’ll just say that I’m still paying a freeze fee on a legacy gym membership. I too blame the difficulty of getting out of the two-year contract I signed up to, which comes with a hefty cancellation fee.

In the end I need to pull myself together, state my case, and stop those direct debits. If I was able to give 30 days notice of cancellation and pay a modest fee I’d be much happier, and in turn I’d be more likely to recommend that gym chain to a friend. At the moment, I’d warn them off and send them to a cheap council gym where it’s more common to pay month by month.

Comments
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rarrar says:
26 January 2012

On another forum a member was reporting that they had cancelled their gym membership and had the cancellation confirmed but he forgot to cancel the standing order for the monthly charge.
2 years later he realised he had paid out >£1000 to the gym since cancellation.
Gym refused to refund saying it was his mistake and quoting following para in membership T&Cs:

“> c) Cancellation of fully flexible monthly membership
> iii. If we continue to recieve payment after your membership has been
> cancelled, we will accept this as your notification of your wish to
> continue your membership.”

This contract term seems purely designed as a trap for this situation !!

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Jacob says:
27 January 2012

How terrible! I had this happen as well, no money back on it either!!

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tpoots says:
27 January 2012

I’m no lawyer but is that actually legally enforceable? Typically, businesses have control of when and how much they take from direct debit, so if they continued taking it I’d be complaining to my bank.

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Patrick Steen says:
27 January 2012

Now, that is an interesting case. I spoke to our senior solicitor Joanne Lezemore, who said:

‘It is highly likely that such a term will be deemed unfair pursuant to the Unfair Terms in Consumer Contracts Regulations as, in essence, the company are trying to benefit from a mistake of an ex-member. At common law, one party would not be allowed to benefit from the mistake of another when it is clear that a mistake has been made.

‘The notice of cancellation shows the intent of the customer and trying to imply that such consent should be overridden in this way is an argument I would hope that no District Judge would accept.

‘I would actually advise the member to refer this company and the term to the Office of Fair Trading – although it won’t take an action on behalf of an individual, it can investigate and take action directly against the firm.’

It would be great if you could track down the person who had this problem Rarrar and point them in this direction! Thanks.

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Michelle says:
10 April 2016

This also happened to me at Life Style Fitness, my contract was cancelled but they were still trying to take the money from my account, they passed this onto a debt management company but fortunately I had kept all written communication with the gym that showed they had agreed cancellation, eventually this was resolved. I don’t understand why t can be legal to be tied into a yearly or two yearly contract, IF you are no longer using a facility such as the gym, why should you be forced to continue to pay?

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tpoots says:
27 January 2012

I think it’s ridiculous that Gyms tie you into such contracts. Mobile phone contracts are a different ball game as, although they are just as long, you can take it with you when you move. Gym memberships you often cannot – what if this chain doesn’t have a gym near you?

Personally I don’t think Gyms should be able to have gym contracts at all, it isn’t a service worth warranting one and only benefits the business in question.

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jgh1 says:
27 January 2012

This is nothing new and OFT has recogised but allowed bad practice for far too long..

Several years ago I belonged to a local council gym that was outsourced. The contractor’s conditions said, in effect, that they could kill me without paying compensation but my estate would have to carry on paying the monthly fees!

The council said that it had no control over the terms.

It is time for OFT etc to start prosecuting this sort of thing in all cases as an unfair trade practice.

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ArgonautoftheSeas says:
27 January 2012

Hi Guys

Money paid under mistake of fact may be recovered, as money had
and received to the use of the person paying it but
money paid under a mistake of law is not recoverable, except where
paid to an officer of the court OR in case of fraud.

A bit concerned abt the legally-binding effect of contractual terms
entered into.

Bring a claim under the small claims track in any event.

Good luck

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Paul says:
29 January 2012

I just cancelled my D/D as I came into financial problems, I did get many threating letters but nothing came of them. I just though I it did go to court I haven’t used the gyms services so why should I be forced to pay for something which hasn’t been received??

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Anita K says:
8 July 2012

I have recently moved a quite considerable distance from the David Lloyd gym I was a member of for more than 2 years. When I cancelled previously (disatisfied with children running about in the gym) I was told I could cancel with a month’s notice. After having signed back on within the termination period and using the gym for a further 4 months I have needed to move for my work. There is a David Lloyd in the area I have moved to however my membership cannot be transferred so if I sign up with them I will be paying double membership. I was then told that when I move it will be 3 months termination so having moved 40 miles away I am still paying 3 months gym membership plus the portion of the month until the day in the month I am allowed to give notice (nearly 4 months total).

As an aside I find it funny how gyms can instigate a price increase that is active from the following month after notifying members but if you should disagree with the value of the increase you can give notice of three months still being duty bound to pay the increased costs for the 2 months since the noticifcation of the increase.

Gyms make most of thier revenue from customers who sign up with good intentions then don’t go, so place absolutely no strain on the resources of the gyms. Also when gyms do become overcrowded as the Bushey gym did on Mondays there is no contracturally binding owness on the gym owners to ensure that there are enough facilities for fee paying members to be able to use the gym at any time within the stated opening hours. When I enquired about the possibility of making more gym facilities available in preference to under-utilised tennis court floor space as I was struggling to find free gym equipment to use, I was told David Lloyd is a raquet club not a gym if you dont like it go to a different club. The evidence of the packed gym and empty tennis courts said most of the members using the facilities had signed up for the gym but there is no way as a fee paying member I could ask for the gym facilities to be made sufficient to support the number of people using them. The terms of the contracts gyms issue us are definately loaded in favour of the corporate entity not the individual.

I can understand that gym owners will try to hold on to these revenue streams (money for nothing!) for as long as possible but for goodness sake surely they cannot be allowed to tie people into ever more contstrictive commitments on thier ability to train thier bodies with no common sense applied to the fact that people may be restricted from making use of facilities for reasons they cannot control e.g. pregnancy, injury, moving etc. This service is specifically only useful to healthy individuals living in proximity to where the service is being offered.

The choice of gyms should not be a ‘life-choice’ with no hope of parole, tying people for up to 2 years into a contract they may not be able to pay for, delivering services that may be substandard or that the contracted party may no longer be able to use. It seems however that every major gym chain has developed it’s own extremely ‘one-sided’ contract terms because there is no legislation in place to stop them. Like the financial services industry I feel that the gym sector should be given instructions to regulate itself or a issued with the ultimatum that it will be regulated and abitrated independently.

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M&M says:
31 October 2012

I had been a member David Lloyd for approximately 10 years and then left. I rejoined 4 years ago as a joint member with my husband, but we hadn’t been using the gymn due to time restraints. We decided to cancel our membership but couldn’t find our original contract so looked on their website to see what we had to do. Could find nothing on their website, so phoned them up and asked what we needed to do. We were told to write in and give 3 months notice which is what we did. Our last payment was in July and in September we got a letter from debt collectors saying we owed David Lloyd over £600 in arrears.

When we spoke to David Lloyd they said they hadn’t received our letter and that we should have phoned up 10 days after we posted the letter to check that they had received it. Without proof of posting they won’t accept that we cancelled our membership and insist we pay them the money as all this is in their terms and conditions. We pointed out that we had done what a member of their staff had told us but they’re having none of this. They’ve sent us a copy of our original contract and although in the small print of the document it states that we should phone after 10 days and send the letter recorded delivery, on another sheet of paper which we signed headed Terms and Conditions Important Points it makes no reference to the fact that we should send our letter of cancellation by recorded delivery.

It seems to me they are deliberately trying to hide this part of the terms and conditions – surely this can’t be right and is completely unfair? I really don’t see why we should have to pay over £600 when we have acted in good faith and taken the advice of their member of staff. Surely if the proof of postage is so important to them, it should be clearly stated on their website and also be listed on their document headed Terms and Conditions Important Points?

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JGH1 says:
1 November 2012

Surely the inconsistency must make the provision unenforceable under the Unfair Terms in Consumer Contracts Regulations?

Could asserting a right that you can’t enforce be an offence under the Consumer Protection from Unfair Trading Regulations?

Worth reporting to Trading Standards.

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Caz says:
11 January 2013

I am concerned about an 88 year old lady who joined a gym for exercise therapy in August 2012, at a cost of £45 per month for a 12 month period, to help with her arthritis. After 2 months, it became clear that far from helping, the exercising was actually exacerbating her condition, to a point where she was finding it difficult to walk. She has 2 replacement hips, 2 replacement knees and arthritic shoulders. She decided to terminate her contract and cancelled her direct debit, having paid for 2 months and attended the gym on 5 or 6 occasions during those two months and also obtained a letter from her GP to confirm that it would be best for her to stop exercising at the gym. The credit agreement company would not accept the GP’s letter as sufficient evidence and requested a letter from a Consultant, who discharged her care back to the GP in 2007, so the GP wrote again and included a copy of the correspondence from the Consultant at that time. Yet, still the lady is receiving demanding letters stating her arrears are £135 and her total debt is £450.
The letters she is receiving are causing her much distress and also now that she is in much more pain with her movements, she really needs the money to help with her care, which she can ill-afford.
I am astounded that any company can treat an elderly lady in this way and will not release her from her obligations and am actively researching what can be done through the Citizens Advice Bureau, Office of Fair Trading and Financial Ombudsman Service but am wondering if Which? can also offer any advice or assistance. I have told her to speak to the local newspaperor her MP but she would not welcome the attention.

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