The physical fitness industry is one of the fastest developing in the Western world, especially when talking about gyms and gym memberships, which cost several hundred dollars for a registration of a few months. For the majority of users of gym services, the standard set up is to join a membership and the gym fees are deducted each month directly from the user’s credit card or bank account. Given the scope for abuse in a system of this variety, contracts for gym membership sometimes run afoul of the EU Directive on Unfair Terms in Consumer Contracts, adopted in the UK as Consumer Contracts Regulations.

It is this kind of contract that has observed the Office of Fair Trading do a High Court order towards gym management company, Ashbourne Management Services Limited after uncertainties were brought up about its compliance with consumer credit laws and fairness in contract provisions.

Ashbourne Management Services Becomes A Case Study: Ashbourne created a practice of creating membership agreements and acquiring payments. Under the terms of the agreement, users were locked into a contract for around three years at a time, in which they were incapable to terminate their subscriptions. Those who attempted to do so were often given bills worth hundreds of pounds for the most of the amount owed on the gym membership contract. Lots of the gym users were could not pay the bill, and were noted to a credit defaulting agency by Ashbourne.

In classic contract law, such an deal would not show a problem. Nevertheless, the proliferation of laws built to secure consumers means that such terms are more and more likely to be found illegal and may render part, or your entire contract void. To prevent situations like this, ensure that your contracts are drafted and/or reviewed by a licensed solicitor with experience in commercial contract drafting.

It is such a contract that has witnessed the Office of Fair Trading carry out a High Court order against gym management company, Ashbourne Management Services Limited, after questions were brought up about its compliance with consumer credit laws and fairness in contract provisions.

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