(a) Unless the buyer is granted a right to cancel the health club agreement as provided in subsection (b), no buyer shall be bound by any health club agreement with a stated initial term greater than thirty-six (36) months.
Contract: A legal written agreement that becomes binding when signed.
Finance charge: The total cost of credit a customer must pay on a consumer loan, including interest. The Truth in Lending Act requires disclosure of the finance charge. Source: OCC
Health club: means any enterprise, however styled, which offers on a regular, full-time basis, and pursuant to a health club agreement, services or facilities for the development or preservation of physical fitness through exercise, weight control or athletics. See Tennessee Code 47-18-301
Health club agreement: means an agreement whereby a buyer purchases, or is obligated to purchase, any right to use health club facilities or services. See Tennessee Code 47-18-301
Operator: means any person, firm, corporation, or business entity which operates a health club. See Tennessee Code 47-18-301
written: includes printing, typewriting, engraving, lithography, and any other mode of representing words and letters. See Tennessee Code 1-3-105
(b)(1) A health club agreement may include a provision or stipulation that provides for a month-to-month continuation of the agreement, either as an initial agreement between the operator and the buyer or as an extension of an agreement beyond a stated term or duration; provided, that the buyer has the right to cancel the continuing portion of the agreement by providing the health club operator thirty (30) days written notice by registered mail of the buyer’s intent to cancel the agreement.(2) A buyer shall have until midnight of the seventh business day after the date on which the first service under the health club agreement is available to cancel if the health club agreement is subject to a finance charge. “Business day” for the purposes of this subdivision (b)(2) means any day the health club is open unless the seventh day is a day the health club is not open for business to the buyer; provided, however, that if the health club is closed on the seventh day, the buyer shall have until midnight of the next day the health club is open to cancel the health club agreement. Cancellation is evidenced by the buyer giving written notice of cancellation to the health club at the address of any facility available for use by the buyer under the health club agreement. The buyer shall deliver the notice by personal delivery or by certified mail delivery, return receipt requested. Personal delivery is effective when delivered to the health club or to the health club’s address, whichever comes first. Notice of cancellation by certified mail delivery shall be effective upon the date of post marking. Notice of cancellation need not take a particular form and is sufficient if it indicates, by any form of written expression, the intention of the buyer not to be bound by the contract.
