Consumer law: High Court rules gym contracts “unfair”

Consumer law: High Court rules gym contracts “unfair”

With summer just around the corner, many people are flocking to gyms in a last-ditch attempt to tone up for their beach holidays. But often customers are “exploited” by gyms that “trap” them in lengthy membership contracts.
This practice has now been declared “unfair” in a recent High Court ruling.

Ashbourne Management Services, which run membership services for more than 700 gyms throughout the UK, had many complaints brought against them for the having unfair terms in contracts, which could last between one and three years.

When customers found that they could no longer afford to keep up their gym membership, Ashbourne demanded the entire amount for the contract up front. This could mean as much as three years’ worth of payments in one lump sum.

The Office of Fair Trading said that many customers felt “pressured into paying sums of money that they believed they did not owe”.

The High Court ruled that the minimum length contracts were unfair and therefore unenforceable. Also, the way the company collected arrears was found to be unlawful.

Mr Justice Kitchin said that the company “exploited … the average consumer using gym clubs at the lower end of the market”.

This case will have a resounding effect on how gym membership contracts are drawn up in the future. Mr Justice Kitchin stated that trying to enforce, or even include, unfair terms in a contract which would result in a customer paying money unnecessarily is unlawful.

The OFT said: “We are pleased that the court has confirmed that these practices are unlawful, and this should bring peace of mind to many people who have fallen into the trap of signing up to these lengthy gym contracts.

“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.”

Related links:
Read more on this story (Moneywise)
Learn about the customers’ rights to challenge unfair contract terms (FindLaw)
Find local solicitors specialising in consumer law throughout the UK (FindLaw)

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