OWM Newsletter
December, 2011


Attorney Spotlight

David A. Megay, Esq., is an attorney with OWM Law concentrating his practice in the Real Estate/ Title Insurance, Business Planning and Estate Administration Areas.

Dave resides with his family in the Pottstown area. This is his 23rd year in the practice of law, the last 19 years of which have been with OWM Law. Dave is a proud member of the Phoenixville Rotary and serves on many community and charity boards of directors.

Phone: 610-917-9347
Fax: 610-917-9348
Email: dmegay@owmlaw.com

The material in this publication was created as of the date set forth above and is based on laws, court decisions, administrative rulings and congressional materials that existed at that time, and should not be construed as legal advice or legal opinions on specific facts. The information in this publication is not intended to create, and the transmission and receipt of it does not constitute, a lawyer-client relationship.


PA’s Health Club Registration Act
and Your Health Club Membership Agreement

Hopefully, most of our readers engage in some kind of physical activity…jogging, bicycling, weightlifting, cardiovascular work, etc. While many of our readers engage in such activity at home, I would think that most of us belong to a local workout facility. If you do belong to a Health Club in your community, be advised that the facility is closely regulated by Pennsylvania law.

The Pennsylvania Health Club Registration Act became effective on June 20, 1990. The Act was passed in response to a number of high-profile scandals in the late 1980’s - some Health Club facilities took membership dues, initiation fees and deposits from the public and then went out of business and moved out of town during the dark of night, or never opened in the first place. In response to such fraud, the Pennsylvania Legislature passed the above Act to provide closer scrutiny of the Health Club industry and provide more protection for consumers. The Act regulates Health Clubs as follows:

• All Health Clubs must register with the Pennsylvania Office of Attorney General, Bureau of Consumer Protection, at least 30 days before they advertise or sell Health Club contracts;

• All Health Clubs must register if they will be selling membership contracts for a term of more than 3 months;

• Existing Health Clubs must separately register for each Health Club location owned; and

• The actual Health Club membership agreement must be reviewed and approved by the Pennsylvania Office of Attorney General before the Health Club can sell memberships.

Generally, all for-profit clubs that have health training facilities as its primary purpose are regulated by the above Act. The Act, however, does not cover non-profit organizations that have a Health Club in its facility. The Health Club must post a bond or a letter of credit with the Commonwealth if it wishes to sell Health Club memberships for a term of more than 12 months. In practice, most Health Clubs apply to be exempt from posting a bond or letter of credit, and, in order to do so, the club must agree that: it cannot sell membership agreements for terms longer than twelve months, all payments must be made in equal monthly installments, the initiation fee is limited to the actual cost of establishing the initial membership, the membership agreement must contain a provision terminating the contract if the Health Club goes out of business without another club owned by the entity existing within a 10-mile radius, etc.

A Health Club membership agreement must:

• be in writing;

• give the member a 3-day right of rescission to cancel and get all of his money back;

• allow members to extend the term if temporarily disabled (or cancel if the member dies or becomes permanently disabled, in which case the member will receive a refund of his pro-rata share of prepaid fees);

• allow the member to cancel the agreement, and receive a refund of his pro-rata share of prepaid fees, if he moves more than 25 miles from his home without another facility being available within a 5-mile radius of his new home; and

• not automatically renew without the member affirmatively accepting renewal at the end of each term.

If the Health Club fails to comply with the Act, the Pennsylvania Attorney General’s Office can file criminal charges (2nd degree misdemeanor) and bring a civil action against the owner under the Unfair Trade Practices Act (and charge up to $3,000 per violation). In addition, a Health Club membership agreement is voidable by the member if it does not comply with the Act.

As you can see from the above, Pennsylvania is strictly regulating Health Clubs and their membership agreements. The next time you are running on a treadmill, riding the elliptical bike and/or lifting weights at your Health Club ask for proof that it is in full compliance with the Health Club Registration Act.

Information regarding your Health Club membership agreement is featured in the OWM Legal Talk program appearing on PCTV for the month of December, 2011.  This and other Legal Talk programs can be viewed on our website at www.owmlaw.com/legal_talk/legal_talk.php.


Firm News

David A. Megay is being featured on Phoenixville Phantom TV in its "Expert’s Corner" series discussing legal issues, including estate planning.


Upcoming Events

Read Legal Ease every other Sunday in the Pottstown Mercury.

Watch Legal Talk, brought to you by OWM, on PCTV, Tuesdays at 8:30 on Channel 28, and Thursdays at 9:30 p.m. on Channel 98, or on our website at www.owmlaw.com/legal_talk/legal_talk.php.


O'Donnell,Weiss & Mattei, P.C.

41 E. High Street
Pottstown, PA 19464
Fax: 610-323-2845

347 Bridge Street, Suite 200
Phoenixville, PA 19460
Fax: 610-917-9348