Legal Updates

Commercial Law – Unfair Terms – Gym Membership Contracts – OFT – Notice Period

In July 2011, we posted an update around the case of Office of Fair Trading v. Ashbourne Management Services Ltd and others [2011] EWHC 1237, where it was held that certain gym membership contracts contain unfair terms within the meaning of the Unfair Terms in Consumer Contracts Regulations 1999.

In particular, this case brought to light various unfair commercial practices, such as:

• Tying members into minimum membership periods; and
• Payment of all future monthly installments upon default.

Office of Fair Trading (“OFT”) Investigation

Last year the OFT launched an investigation into whether a number of gym chains were in breach of the Unfair Terms in Consumer Contracts Regulations 1999 or engaging in practices under the Consumer Protection from Unfair Trading Regulations 2008.

Once of the areas that the OFT has impacted on is the notice period to which members should adhere to in order to end their contracts, in particular, when such members have been made redundant or otherwise lost their jobs. This was the case with Virgin Active and the gym has made changes to its terms and conditions to extend the notice period from one to two months for people who are made redundant.

Further details can be found on the OFT’s website, here.

How can we help?

Whether you operate a gym or some other business, including online businesses, RT Coopers provides tailored commercial advice. We also offer specific services to businesses, such as:-

• Due diligence (business operations);
• Contract review;
• Terms of business;
• Contract drafting;
• Website terms and conditions and privacy policy;
• Regulatory advice.

For any queries on commercial contracts of terms of business, you may contact us by email [email protected]. Visit http://www.rtcoopers.com/practice_corporatecommercial.php  

© RT COOPERS, 2013. This Briefing Note does not provide a comprehensive or complete statement of the law relating to the issues discussed nor does it constitute legal advice. It is intended only to highlight general issues. Specialist legal advice should always be sought in relation to particular circumstances.