David Lloyd Gym Membership cancellation

Chamone_2

Any help/advice would be greatly appreciated! The simple facts of my situation are these...

• I have been a member of David Lloyd York for over 4 years, and every year I have paid for my entire year's membership in full.
• I was contacted recently (27th April) to inform me what my membership fee would be for 2009-2010 and when my current year's membership expired (May 19th).
• I chose not to renew this year, wrote to them on 28th April to inform them, and received a call back saying that I had to leave 3 months notice before cancelling my membership. I must therefore pay for 3 months membership (plus the pro rata for the rest of May) before I can leave - equating to over £250 in fees.

I went back to check my membership Ts & Cs and sure enough, in the small print, it does say that you have to leave 3 months notice before cancelling any membership.

My argument is that I was not informed what my renewal fee would be OR when I needed to renew by, in time enough to allow me to decide. Even if I had replied on the date that the letter was sent, I would STILL have been inside of the 3 month period. I therefore feel I have been left with no choice but to pay for the extra three months and pro rata. :mad:

Now, I absolutely understand that if I paid my membership monthly, the gym should reserve a right to enforce this 3 month notice period (otherwise members could just walk away at any point). However; unlike other gyms, David Lloyd does not appear to make a distinction between monthly and annual payers. From their point of view - surely it's not fair to assign me the same rules and procedures - they've had a huge lump of my money sitting in their bank since last May!

Where do I stand from a legal/consumer rights perspective?

I've read some horror stories of people trying to leave DL without paying their 3 months notice, and being chased by debt collectors and/or having CCJS littered all over their credit history. I'm not at all interested in encouraging this kind of trouble, but I do want to take this further if possible. What would be your advice?

Optimist

Your argument would I fear fail as I would bet David Lloyd has a little term in their T@Cs stating something to the effect that you will renew at the rate current at the time

The OFT get lots of complaints about gyms and they put out a press release in January

http://www.oft.gov.uk/news/press/2009/05-09

You could get in touch with consumer direct to see what they say http://www.consumerdirect.gov.uk/

Chamone_2

Thanks...I'll try to get in touch with them.

I've spoken to other gyms about it and they've been unanimously outraged that DL could get away with this.

Fingers crossed I'll be able to sort something out.

Gordon861

Surely the change of fees counts as a significant change to their terms and conditions and therefore you can exercise your rights to withdraw from the contract with immeadiate effect.

You have the right to 'reject new changes to your agreement' as soon as you become aware of them and not be held by the 3 month cancelation clause(or any cancelation period).

You could also argue that your contract with them is just for 12 months and that it is your choice to renew each year in the same way you do with insurance. As you said if it had been a monthly charge you would be stuck with it.

Another question is if you have set up a recurring charge for membership or do you just wait for the letter. A recurring charge will work in their favour but if you just pay it each year that should work in your favour.

The argument if this does end up in a County Court will be wether these T&Cs were fair and therfore enforceable.

Chamone_2

Thanks Gordon; you're absolutely right- I just pay every year, no recurring charge.

Due to my commitment to renew my membership every year in full, my fee has always stayed the same. This is the first year that it has changed. I would have thought it would be fair for me to reject this, given that they gave me just 2 weeks to decide....nowhere near the 3 months stipulated in the contract.

The insurance analogy is also very helpful- thank you.

I'm writing to head office later today - will incorporate all of this and let you know how I get on.

Chamone_2

Reply from Consumer Direct:

Dear Mr *****
I am writing to acknowledge receipt of your email submitted via the Consumer Direct website on 19 May 2009 regarding your gym membership. Your reference number for this enquiry is YH564223 and should be quoted in all further correspondence concerning this matter.

I understand that you are in dispute with the gym regarding the term of your membership, as you feel that you should have been notified of the terms of renewal in time to cancel the agreement without penalty.

I note that you state reference is made within the terms and conditions of your contract to the fact that three months notice must be given to cancel without charge. From a customer service point of view I feel it would be better if, in addition to being given the written terms, you were verbally advised of the conditions of the contract when signing up, and if you were contacted in time to cancel without penalty. However, David Lloyd may effectively argue that they do not have a legal responsibility to do so.
As you wish to pursue this matter further, I would suggest that you write a formal letter of complaint to David Lloyd stating why you feel the penalty is inappropriate and requesting a response within 14 days. You may wish to send the letter by recorded delivery, or obtain a free of charge certificate of proof of postage at the post office, and keep a copy of the letter for your own records.

If they refuse to allow you to cancel without this fee you may wish to challenge the situation in court, perhaps on the basis that the terms are unfair. However, you need to bear in mind that this may prove costly and you may not be successful in your claim. The Office of Fair Trading have produced an A4 booklet named "Guidance on unfair terms in health and fitness club agreements", which I will be happy to send to you if you provide me with your full address.

I trust the above information is of some assistance to you. If you wish to discuss this matter further please call me on 08454 040506 quoting your reference number, together with your full address and contact telephone number.

Thank you for your enquiry.

Yours sincerely
S Hughes Consumer Advisor

Gordon861

I'm trying to find a link that supports what I'm trying to say on the web but getting the search terms wrong.

It boils down to something like 'I reject the fundamental change in the contract terms ie the price increase. I therefore cancel my membership from the date of this price increase and will not be accepting the new contract'.

It's similar to (http://www.mifa.co.uk/site/knowledgebank/knowledgearticle/ifa_mzone_hr_coe?id=mzone_hr_coe_cct.html) but this is talking about employment law instead but the principle will be the same.

Terms should not be changed without agreement, and if they are this is likely to amount to a breach of contract. A breach occurs where one party introduces a fundamental change that is unacceptable to the other party. Where there is a breach, this gives the party who has not consented to the change the right to sue for breach of contract. Where a breach of contract claim is pursued in law, the courts can order that the contract is returned to its initial terms. Contract terms cannot be changed merely by the issue of notice to change. Such notice amounts in law to a notice to terminate the contract and then to offer a new contract on different terms.

Interesting read : http://www.oft.gov.uk/shared_oft/reports/unfair_contract_terms/oft311.pdf

8.1 A clause which states how long a contract has to run is likely to be among its most important 'core' terms 24 If a lesser term in small print can be used, relying on customer inertia, to extend the contract period beyond what the consumer would normally expect, it is not a core term, and is liable to be considered unfair.

8.3 The OFT considers that an over-long cancellation notice term may also be unfair in a contract which continues indefinitely rather than for a fixed term. Consumers entering such contracts normally expect to be able to end it a reasonable time after they decide they no longer want or can no longer afford what is provided under it. If they are required to make a cancellation decision too far ahead of time, they are liable either to forget to do so when they need to, or wrongly to anticipate their future needs. In either case, the effect of the term is the same as that of an 'automatic renewal' clause – they experience an unintended extension of their payment obligations.

10.2 If a term could be used to force the consumer to accept increased costs or penalties, new requirements, or reduced benefits, it is likely to be considered unfair whether or not it is meant to be used in that way. A variation clause can upset the legal balance of the contract even though it was intended solely to facilitate minor adjustments, if its wording means it could be used to impose more substantial changes. This applies to terms giving the supplier the right to make corrections to contracts at its discretion and without liability.

12.2 Any purely discretionary right to set or vary a price after the consumer has become bound to pay is obviously objectionable. That applies particularly to terms allowing the supplier to charge a price on delivery of goods that is not what was quoted to the consumer when the order was placed. It also applies to rights to increase payments under continuing contracts where consumers are 'captive' – that is, they have no penalty-free right to cancel.

I think the last two are probably a good one to hit them with. I'm going to save that PDF for future I think.

Tozer

What a rubbish response from Consumer Direct.

I think Gordon has it right. However, was the new annual fee higher than last year? If so, you should have the right to not accept the new terms and to terminate the contract. If you look at all decent terms and conditions (e.g. broadband, telephone companies, etc) they all give a right to terminate if the charges increase and you are not happy.

This is reflected in the OFT guidance as to fairness.

Chamone_2

Wow - thanks again Gordon. Tozer - yes the annual fee was about £150 higher than the previous year; this was the first I'd heard of the change so I'm going to hit them hard with the OFT point about 'forcing' acceptance of renewal after increased costs. Should do the trick!

Gordon861

With a price change of £150 per year there is no way I would even have worried about even looking at what the T&Cs said. I would just have rejected it on the spot and told them to poke it. The best I would offer them would be to possibly stay a member for 3 months at the old price.

Chamone_2

Just a quick note to say that thankfully, this has been resolved - I wrote to my gym's general manager quoting the above extracts from the OFT report, and within 2 days I received a letter back saying that my membership was cancelled effective immediately, without having to pay any penalties. Result!

Huge thanks to everyone (Gordon861 especially) for your help.