Can I be charged a cancellation fee with no signed contract?

danm86

Hi all, thanks for reading.

I recently cancelled by gym membership due to moving house. My account has been passed to a Debt Recovery Agency (why I'll never know) - the DRA confirmed that I was within my rights to cancel the contract as I was over 20 miles away.

I then got a call saying I was subject to a Cancellation Fee of £100, I said that was fine as I have no problems with paying this however could I have a copy of a signed agreement between myself and the gym (I know there is not one in existence), the agreed to send me a copy. Three weeks later I received a letter informing me the Fee was £220 (a slight difference in comparison to the £100) with no copy of a signed contract, only a photocopy of the Gym's T&Cs and a Screenshot of a Memebership Datasabe containing (very few) of my details.

I've done a bit of research in the DRA as I have never delt with one and this one in particular appears to be a bit slippery - am I obliged to pay the cancellation fee if there is no contract in existance and if so is there some FSA regulation that states so - I don't know if it is worth mentioning that I paid the Membership originally by Direct Debit.

Any help would be greatly appreciated, thanks for your time!

Optimist

Firstly never deal on the phone always have it put in writing

I assume that it is the DRA trying to get you to pay a cancellation fee not the gym.

I would suggest you write to them keeping a copy of your letter stating something to the effect that they are in breach of OFT guidelines namely Section 2.9 applying charges unfairly and Section 2.10.b misleading debtors into believing they are legally liable to pay collection charges when this is not the case, for example, when there
is no contractual provision

I would also mention that you are fully aware that they need a Credit Licence in order to operate and that you will expect to hear from them within the next 14 days confirming that the matter is closed and you will cease what you consider to be harassment forthwith. Tell them that if you haven't heard within this time, or you receive any more demands in breach of the OFT guidance detailed above you willl have no option but to contact the OFT to make a formal complaint calling into question their fitness to hold a Consumer Credit Licence.

danm86

Thanks for that, great advice! I'm looking into now. Thanks again.

Anihilator

You dont have to have a signed contract to be liable for the £100 charge. The cancellation charges are a bit different if they can be disputed as unreasonable.

A verbal contract is binding and if you are happy the £100 is due stop wasting your and their time and pay it in agreement that will settle the matter.