Advice on frustrated contract with mvmt42 gym

[BillyBleach]

Hi, was hoping some of the learned members here would be able to help me understand my position better with respects to a gym contract I have and the Law Reform (Frustrated Contracts) Act 1943.

In November 2020 as the second national lockdown measures were announced, I was unwilling to continue to pay membership for a service I was unable to receive. The gym notice period was three months. I tried to speak to the owners regarding the fact that throughout November no services were being provided but they would not budge and held me to the three month notice to exit the contract. 

I subsequently learned of the Law Reform (Frustrated Contracts) Act 1943 and the CMA guidance (as detailed on gov uk Statement on coronavirus (COVID-19), consumer contracts, cancellation and refunds). As I read the guidance, when lockdown measures were introduced in November the contract became frustrated and ended. I also understand that no payment should have been taken and any upfront payments should be refunded (The gym takes payment for the month in lieu).

I only learned of this legislation early January. Since then the gym have taken all three payments from me, despite again entering lockdown restrictions in January. FWIW since the moment I informed them I intended to exit the contract (first week of November 2020), I have not set foot in the gym. 

Am I right in thinking as the contract I had with the gym became 'frustrated' due to lockdown restrictions imposed in November, the contract ended. As such the gym shoudl not have taken any payments, and should now refund me all three payments taken from November 2020 - January 2021?

Thanks in advance for any input you might have  

[dx100uk]

there is no such thing as 3mts notice, at best it's ONE month.

and that is debatable only if you didn't tell them you wanted to cancel and cancelled the DD before giving 30 days notice .

 

who's the gym please?

and what type of contract were you on (12mths?) or rolling? and when did you sign up.

 

gyms don't do court

gym debts dont appear on credit files

there is nothing they can do to you were you to reclaim under the DD guarantee with your BANK the 3 mts they took .

 

 

[BillyBleach]

Thanks for the prompt reply. 

 

This is a boutique gym (www.mvmt42.com) in West Sussex. To my knowledge this is the only site they operate. They charge monthly against a registered card, and include a three month notice in the contract. Payment type by DD is not offered. So I guess it a rolling three month contract. 

 

My issue here is the payments have already been collected. I have disputed with them January's payment as lockdown was imposed again and the services offered are radically different that what I signed up for (I.e. full gym access with equipment and coached classes vs zoom session at home).  

 

Since I now learn of the concept of frustrated contracts and the fact that since November it seems (correct me if I am wrong) that once lockdown restrictions were imposed, my contract ended as it was legally frustrated. 

 

Orignally I reached out to the gym to refund the January payment, but now I want to know whether in fact I am entitled to claim all three months back, based on the fact those payments have been collected out of contract. 

[dx100uk]

forget frustrated contracts ...not worth the hassle.

 

it will be a continuous payment arrangement.CPA

so ring your bank

get them to cancel the cpa and ask for the last 3mts back.

 

then ignore everyone.

 

dx

[BillyBleach]

13 minutes ago, dx100uk said:

forget frustrated contracts ...not worth the hassle.

 

it will be a continuous payment arrangement.CPA

so ring your bank

get them to cancel the cpa and ask for the last 3mts back.

 

then ignore everyone.

 

dx

So you think a LBA, and MCOL directly to the gym is overkill to achieve the refund for the last three months?

[dx100uk]

Where ever did you get that notion from?

 

just use cpa

[BillyBleach]

1 minute ago, dx100uk said:

Where ever did you get that notion from?

 

just use cpa

 just my poor knowledge of consumer action. 

 

Thanks for the advice will pursue with my bank. 

[slick132]

Yes, forget the measures you mention and simply reclaim payments made by the bank.

 

I suggest you reclaim just the last 2 payments, the first being left for 1 months notice.

 

When did the gym close down again ? 

[slick132]

Hi BB,

 

Forgot to say that banks have, in the past, been reluctant to take customer instructions with CPA's, treating it more like it's the Payee who controls the CPA.

 

If the bank refuses to refund the 2 or 3 payments (your choice which to go for), come back and tell us what was said.

[dx100uk]

from my notes...

 

GENERAL NOTES ON CHARGEBACK & Continuous Payment Authority & BACS 
 .....
 We have been telling people to put a letter into their bank instructing them 
not to make any payments under any circumstances to these companies
 .
http://whatconsumer.co.uk/visa-debit-chargeback/- it works!
usually this should be done using the number on your debit card
 .
 banks MUST follow written instructions from their customers !
.
CANCELLING YOUR DEBIT CARD DOES NOT STOP CPA'S
 .
 This fsa guide has now been updated:
 .
http://www.fsa.gov.uk/static/pubs/consumer_info/know_your_rights_guide.pdf
http://www.fca.org.uk/news/continuous-payment-authorities-your-right-to-cancel
https://www.fca.org.uk/consumers/unauthorised-payments-account
 .
 Here's the text:
 .
 Cancelling a regular  card payment:
 .
 When you give your credit or debit card details to a company and authorise them to take regular payments from your account, 
 such as for a gym membership or magazine subscription,
 it is known as a ‘recurring transaction’ or ‘continuous payment authority’.
 .
These are often confused with direct debits, but do not offer the same guarantee if the amount or date of the payment changes.
 .
 In most cases, regular payments can be cancelled by telling the company taking the payments. 
 .
 However, 
 you have the right to cancel them directly with your bank or card issuer by telling it that you have stopped permission for the payments. 
 Your bank or card issuer must then stop them – it has no right to insist that you agree this first with the company taking the payments.
 .
 Be aware, though, that you will still be responsible for paying any money that you owe.
and that CANCELLING YOUR CARD WILL NOT STOP THE CPA
 .
 ..
 .
 New june 2013
 .
 Regulator orders Banks and mutuals to review complaints about not cancelling recurring payments from November 2009.
 .
 Consumers who have set up a regular payment from their account will now be able to successfully cancel that arrangement 
 by contacting their card provider, the Financial Conduct Authority said.
 .
 The FCA has been examining how easy it is for customers to cancel Continuous Payment Authorities (CPAs) 
 due either to payday lenders or for other regular payments such as subscriptions or gym memberships.
 .
 CPAs, which are also commonly called recurring transactions or recurring payments, 
 are relatively easy to set up but can be hard to cancel, causing problems for consumers trying to manage their finances, the FCA said.
 .
 Now, following the FCA review of how the largest high street banks and mutuals process requests to cancel CPAs, they have agreed that they will ensure that when 
 a customer asks for a recurring payment to end, that will be sufficient to cancel the arrangement. They have also confirmed that should a payment go through by 
 mistake following cancellation by a customer the customer will be refunded immediately.
 .
 In addition to securing this commitment, the largest banks and mutuals have agreed to review every individual complaint they have received about the non-
 cancellation of a CPA and to pay redress where payments have continued to be made despite the customer cancelling the arrangement. This applies to all complaints 
 since November 2009 when the Financial Services Authority, the FCA’s predecessor, began regulating banking conduct.
 .
 Clive Adamson, the FCA’s director of supervision, said: “It’s important that consumers are confident that banks are meeting their everyday banking needs. Today 
 customers can be confident that when they ask for a Continuous Payment Authority to be cancelled – it will be cancelled - and that it can be done easily. 
 .
“We recognise that historically this is an area where some customers have struggled but the banks and mutuals have responded positively to our work on this issue. 
 From now on we expect them to be getting this right. In addition, they have committed to review past complaints.”
.
 .
 Also mentioned your displeasure that as whomever took your money had obviously attempted this many times 
 probably activating your banks own anti fraud software - nobody had the decency to inform my you this was going on.?

.
 .In the FSA's own words:
 .
 ..
 What should I do about a payment from my account that I didn’t authorise?
 .
 Your bank must refund an unauthorised transaction. 
 Money can only be taken from your account if you have authorised the transaction 
 or if your bank can prove you were at fault – 
.
see below.
 Contact your bank immediately if you notice an unauthorised payment from your account.
.
 If you are sure you did not authorise the payment, you can claim a refund. 
.
 However, your bank does not have to refund you if you do not tell it about the payment until 13 months
 or more after the date it left your account.
 .
 Your bank must refund an unauthorised transaction
 .
 ------------------
 .
 Your bank may only refuse a refund for an unauthorised transaction if:
 .
 ? it can prove you authorised the transaction 
– though your bank cannot simply say that use of your password, 
 card and PIN proves you authorised a payment; or
.
 ? it can prove you are at fault because you acted fraudulently, 
 or because you deliberately, 
 or with gross negligence, failed to protect the details of your card, PIN or password in a way that allowed the transaction
 .
 -----------------------
 .
 How quickly must my bank refund me for an unauthorised transaction?
 .
 The bank must make the refund immediately unless it has evidence that one of the above reasons applies. 

 Your bank may ask you to answer some questions and fill out a form confirming what has happened, 
 but it cannot delay your refund while it waits for you to return the form.

 If the bank has evidence that one of the above reasons for refusing a refund applies, 
 it may investigate before making a refund 
 but must look into it as quickly as possible. 

 If your bank rejects your claim for a refund it should explain why.
 If the transaction was on a credit card, the refund may not happen immediately. 

 But the card issuer cannot charge interest or ask for repayment of the amount unless it can prove you are liable to pay
 

 

[slick132]

Finally .........

 

Don't worry at all about contacting the gym for now - get the money back first and then we'll help you write a letter to the gym explaining what you've done, and why.