Freeway Fitness Pty Ltd and Kristian Nathan Woods - Enforceable Undertaking

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Date
5 August 2014
Category
Enforceable undertakings

Doveton gym and fitness centre Freeway Fitness Pty Ltd has agreed to change its membership cancellation policies and procedures after contravening the Australian Consumer Law (ACL).

Consumer Affairs Victoria investigated Freeway Fitness after complaints from consumers unable to cancel their membership immediately when the minimum membership term in their gym contracts expired.

Freeway Fitness had told them that they could only give notice to cancel after the minimum term had been completed. The effect of this was that the minimum term was at least 28 days longer than specified in consumers’ membership agreements.

Accordingly, the minimum membership fee was greater than the minimum amount consumers reasonably expected to pay when they signed on.

Consumers were also told that they had to give Freeway Fitness notice of cancellation at a meeting with its representatives. In some cases, these meetings could not be arranged for up to several weeks. As a result, some consumers were unable to cancel until well after the minimum membership term.

Kristian Nathan Woods, a director and shareholder of Freeway Fitness, acknowledged on behalf of the company that the cancellation policies contravened the ACL. The policies and procedures did not allow or provide a way consumers could end their contract immediately when the minimum period (in their contract) expired.

Mr Woods, personally and on behalf of the company, gave an undertaking to acting Director of Consumer Affairs Victoria Phil D’Adamo that Freeway Fitness would:

  • amend its membership contracts and cancellation policy to enable consumers to end their membership agreements immediately when the minimum term in their contract expires, including giving notice before the end of any minimum term
  • provide consumers who entered into a membership agreement prior to the undertaking access to the amended cancellation policies and procedures.

Freeway Fitness will also endeavour to contact all current members subject to the membership agreements found to have contravened the ACL to advise them of the undertaking and their right to use the amended cancellation policies and procedures.

It must also display a poster at the gym’s reception desk which details these rights.

Download the full text:

Freeway Fitness Pty Ltd and Kristian Nathan Woods (PDF, 380KB)

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