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International Health Club News…… Ruling to free health club members from long contracts

Anyone tied into a gym contract of more than a year should be able to cancel it more easily and without cost, following a landmark ruling last month. Working up a sweat: The ruling could mean that other gyms will not be able to tie customers into contracts for more than 12 months. In May, the Office of Fair Trading won a ruling at the High Court against Ashbourne Management Services, which draws up contracts and collects payments from independent gyms. This Friday the High Court is set to make an enforcement order on the ruling which could mean that anyone who is signed up to a gym contract that is longer than 12 months will be able to cancel it for free. During the case the judge looked at 13 Ashbourne contracts, ruling that in 10 of them the lengthy minimum membership periods (usually 12, 24 or 36 months) were unfair when Ashbourne knew that many consumers stop attending the gym after two or three months. He also ruled that three other contracts were still unfair because they tied members in for more than 12 months. The ruling, although not yet legally binding, could see other gyms follow suit. Current contracts for 12 months or longer do not need to be cancelled, but gyms will not be able to enforce penalties or insist that members pay for the whole amount outstanding if members decide to leave.It also means that gym-goers can cancel their memberships without cost, even if it is within 12 months, if they raise genuine issues about the quality of the gym. The OFT said that the ruling should give other businesses in the sector which use similar terms an ‘understanding of how a court would rule’ if its terms or contracts were unfair.Jason Freeman, Director in the OFT Goods and Consumer Group, said: ‘Unfair terms that unreasonably bind consumers into long contracts they cannot leave, and heavy-handed collection techniques, have no place in businesses’ dealings with consumers. ‘This ruling should help traders to understand where the boundaries lie, and sends a warning that if they cross the line, the OFT and local trading standards services can take action.’

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