contract-law business
Can a business put a specific cancel-by date into a contract?
<p>I attended a gym in Michigan and canceled my membership on 8/28/19. I paid month to month and was under no long term contract. Even though I moved and haven't visited the gym since 8/17/19, I'm being charged for the entire month of September. My contract states that I needed to cancel by 8/20/19 in order to avoid being charged for September. </p>

<p>Even though the contract lays this out, can a business legally operate in this manner? I'm being charged for a service I'm not using. The gym claims that due to processing and accounting fees, cancellations must be performed before the 20th every month in order to avoid paying for the following month. If so, shouldn't I receive a partial refund and just be required to pay the additional processing fees?</p>

<p>It's not reasonable to assume that you have to cancel before the 20th every month. The gym belongs to a local college, and I'm just a student. Surely, they could allow me to pay a late processing fee and receive a partial refund. I'm trying to research whether Michigan allows for these kinds of practices. </p>

<blockquote>
  <p>Can a business put whatever they want into a contract?</p>
</blockquote>

<p>No. There are some things a business cannot put into a contract. But I don't see anything stopping them from putting <em>this</em> into a contract.</p>

<blockquote>
  <p>It's not reasonable to assume that you have to cancel before the 20th every month.</p>
</blockquote>

<p>It's not reasonable to assume that - except there's no assumption needed. The contract states it flat out.</p>

<p>You are most likely stuck paying. Requiring cancellation about 10 days in advance of the month doesn't seem like it would be an unconscionable clause. (Requiring cancellation 10 months in advance would be a different story.)</p>

<p><a href="http://www.legislature.mi.gov/(S(p3xl5yxva5h5uwdt3zpvbvrj))/mileg.aspx?page=getObject&amp;objectName=mcl-445-903" rel="noreferrer">Michigan law</a> does say the following is prohibited:</p>

<blockquote>
  <p>Taking advantage of the consumer's inability reasonably to protect his or her interests by reason of disability, illiteracy, or inability to understand the language of an agreement presented by the other party to the transaction who knows or reasonably should know of the consumer's inability.</p>
</blockquote>

<p>But I doubt that applies in your case.</p>

<p>It also prohibits:</p>

<blockquote>
  <p>Gross discrepancies between the oral representations of the seller and the written agreement covering the same transaction or failure of the other party to the transaction to provide the promised benefits.</p>
</blockquote>

<p>So if you were promised you could cancel at any time without notice or penalty, but you later found out the contract said differently, this law may apply.</p>

<p>Yes, a contract that gives you a right to use a facility for a specific period of time is valid; it does not matter that you didn't or don't plan to use the membership. There is also no law limiting the advance notice required to cancel a contract, and no law requiring that a term contract be cancellable. It is true that the contract could have been written differently, and maybe you could have found a gym with a "cancel at any time, get a refund" clause. The AG has a <a href="https://www.michigan.gov/ag/0,4534,7-359-81903_20942-159506--,00.html" rel="noreferrer">FAQ about health club memberships</a>, which basically says "read the contract".</p>

<p>In the United States (and other jurisdictions), there is a legal doctrine "freedom of contract" that says that people have the right to bind themselves via contract. There are certain limits on contracts, and legislatures frequently pass laws prohibiting certain kinds of clauses in contracts. Landlord-tenant laws are a typical example; the 3-day cooling off cancellation law is another. In principle, a legislature could pass a law prohibiting contracts which give a user a right to use some property for a given period of time, so that cell phone contracts or club membership contracts would have to be based on actual usage. Alternatively, the law could could specify a maximum advance notice clause (e.g. "any contract can be cancelled with 24 hours notice"). These are political questions.</p>

<blockquote>
  <p>Even though the contract lays this out, can a business legally operate
  in this manner? I'm being charged for a service I'm not using.</p>
</blockquote>

<p>100% and this is Best Practice for a business. The issue is not the fact you're "Not using it". A Gym like many other "memberships" and even Property Management does what's called <code>Monthly Posting</code>. They Post for the upcoming month around the 25-28 of every month for the <code>Next Month</code>.</p>

<p>As a good business practice you charge for the Month coming up. Never at the End. This avoids members or tenants from using something for free and saying "Nah I'm gunna cancel". Kinda like what you're suggesting. So they use resources on you and you don't pony up? That's not how it works. </p>

<p>The opposite (of your "complaint") would be true on the gyms end. What if you move (which you did) and never attended the gym? You then won't pay them for September even though it's assumed you have been there. So the Service is being used, metrics being generated, data assumptions, accessories being ordered thinking you've been there all month. Then, you're the scab. If a business does this (what you're saying is "illegal"); they'd lose a lot of money. Never bill for the  Month that passed.</p>

<p>This is legal. Posting is done this way. They have a cancellation window so you <strong>dont</strong> get included in the Posting for September. If you called/cancelled properly you could've settled on a prorated rate. </p>

<p>Sorry, this is on you. You have no case. </p>
