Member demands refund after health club closes

Posted at 8:23 AM, Dec 04, 2015
and last updated 2015-12-04 10:23:27-05
After the holidays, a lot of us start thinking about losing some weight, getting in shape and joining a gym.
And if you pay upfront, you can get an even better deal, but be careful. A Scottsdale club, called PowerTrain Yoga just closed after being open for a few months.
One of the members, Denise contacted us wondering about her refund. In August, she spent $590 for a year membership.
Members got an email saying the following: 
"We have some disappointing news to share with you. PowerTrain is temporarily suspending classes effective tomorrow (Saturday, November 28TH). Our primary financial partner has suffered a serious medical problem. For this reason, he is no longer able to provide the funding necessary to continue operations.
We are currently in discussions with individuals who wish to replace our partner and resume operations. Hopefully, this will occur very quickly. This morning we contacted the company that processes your automatic membership dues deductions. We have asked them to stop further deductions from your account. Unfortunately, there can be a lag of a day or two before this can be processed. Please rest assured that any deductions made from your account in error will be fully refunded. We are also working on a mechanism for making partial refunds for the unused portion of your last automatic deduction. For example, if your last deduction occurred 15 days ago, you would be entitled to a refund of 50%. This may be a manual process that could take several days to complete. We appreciate your support and understanding and will keep you informed as to our progress. Looking forward to seeing you all again very soon." 
PowerTrain is not the only Valley health club to announce closings recently.
Three 24-Hour Fitness facilities are shutting their doors as of December 15th. LA Fitness recently took them over and is closing clubs in Scottsdale, Glendale and Mesa. In this case, members can use other LA Fitness clubs.
But, what about members who chose a specific location because it was convenient, and now want to quit and get their money back?
I asked LA Fitness and they responded with this statement:

To answer your question, if a member’s agreement affords them the right to cancel and receive a pro-rata refund if we close a club, then we will honor that right.  We look at every club and every member individually.  If a member wants to discuss their membership options, then we are happy to discuss these with them. As to the closures, the club on West Bell Road club is a few minutes away from a larger club with more amenities that we recently remodeled.  Likewise, the Mesa club on North Power Road is just minutes from a club we opened less than 3 years ago that is significantly larger and has more amenities.  Finally, the lease for the Scottsdale club on North 100th  Street expires in seven months.  We have a larger facility with more amenities a little more than 3  miles away that we are hoping these members will use while we look for a site in this market to build a new facility.    This market is very important to us, and we have invested over five million dollars remodeling many of our clubs here this year.  With regards to the other 8 clubs we acquired, we are planning to spend a significant amount of capital to remodel, re-equip and/or expand these clubs or find suitable sites nearby where we can build new replacement facilities.

However, there is some hope for PowerTrain members. The club responded to ABC15 saying "refunds are going to be processed by early next week."
There areArizona laws regarding health club contracts, like a 3-day right to cancel, but the protections are weak.
So, before signing up, ask about cancelation penalties and club closings and get it in writing. Also, don't let the club debit your bank account. Too many times I've seen people quit, but the debits continue.
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