93-004957 Department Of Agriculture And Consumer Services vs. Sweetwater Athletic Club, Inc.
 Status: Closed
Recommended Order on Friday, May 13, 1994.

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Summary: Health club that did not provide alter racquetball facilities on closing is liable for membership refund to members who used racquetball exclusively.






17Petitioner, )


20vs. ) CASE NO. 93-4957




32Respondent. )



37Pursuant to notice, the Division of Administrative Hearings, by its duly

48designated Hearing Officer, Mary Clark, held a formal hearing in the above-

60styled case on February 9, 1994, in Orlando, Florida.


70For Petitioner: Isadore Rommes, Senior Attorney

76Department of Agriculture and

80Consumer Services

82515 Mayo Building

85Tallahassee, Florida 32399-0800

88For Respondent: James S. Byrd, Jr., Esquire

95Shoene, Byrd & Palmer

99Post Office Box 2187

103Winter Park, Florida 32790-2187


111The issue for disposition in this proceeding is whether, as required by

123subsection 501.017(1)(b)1., F.S., and rules 5J-4.003(1) and 5J-4.012, F.A.C.,

132Respondent, a health studio, provided its patrons a facility of equal quality,

144within five driving miles, at no extra cost, when Respondent's facility closed

156in January, 1993.


161In response to notice that claims for membership refunds were made,

172Sweetwater Athletic Club, Inc., petitioned for a formal administrative hearing

182on April 11, 1993. On May 7, 1993, the Department of Agriculture and Consumer

196Services sent a follow up letter stating the basis for its determination that

209upon closing, Sweetwater Athletic Club had not provided a facility of equal

221quality to its members.

225The case was referred to the Division of Administrative Hearings on August

23727, 1993.

239At the hearing, Petitioner presented testimony of its consumer complaint

249consultant, Joseph Alexionok, and testimony of the following complainants:

258Christ Derato, Christine Kirkham, Ian Robertson, Ken Samsudean, James Hadley,

268Kent Cofoid and Alex Jack. Petitioner's exhibits #1-7 were received in evidence

280without objection; however, certain complaints included in composite exhibit #7

290were objected to on the basis of hearsay, when the complainants did not appear

304at hearing to testify. Those complaints have not been considered as a basis for

318finding of fact in this recommended order. See subsection 120.58(1)(a), F.S.

329Respondent presented the testimony of Marshall Cohn, Kim Byrd and Harry

340Meeks. Respondent's exhibit #1 was received in evidence without objection.

350After hearing, the transcript was prepared and filed, and the parties

361submitted proposed recommended orders. The findings of fact proposed by each

372are addressed in the attached appendix.


3811. Sweetwater Athletic Club was approximately thirty years old when it was

393acquired in July 1992 by Kim Byrd. The facility (Sweetwater) was located in

406Longwood, Seminole County, Florida. The facility, in its corporate capacity,

416registered as a health studio in accordance with sections 501.102-501.019, F.S.,

427and it posted a surety bond, as required.

4352. Sweetwater had Nautilus machines and other exercise equipment, a steam

446room, sauna, two racquetball courts and aerobics. The steam room and sauna were

459almost always broken, and Kim Byrd was continually trying to refurbish the club.

472Very few people, mostly five or six men, regularly used the racquetball courts,

485and Ms. Byrd had considered converting them to aerobics space, as there was a

499greater demand for aerobics.

5033. Paramount Health Club, (Paramount), also a health studio under Florida

514law, is located within five miles of Sweetwater. It is a much larger and newer

529facility than Sweetwater. It has a larger aerobics room and more experienced

541personal trainers. Sweetwater lost many of its members to Paramount.

5514. On or about January 8, 1993, Sweetwater closed, and transferred its

563membership obligations to Paramount. Members of Sweetwater and appropriate

572staff of the Department of Agriculture and Consumer Services were notified of

584the closing and transfer.

5885. Paramount has honored all prepaid Sweetwater memberships. Paramount

597already had its own equipment but bought and refurbished every piece of

609Sweetwater's athletic equipment and has, thus, increased accessibility to its

619members. Paramount is a family-owned and operated facility. Its owner, Harry

630Meeks, affirmatively sought out Sweetwater's members to make them feel welcome

641and to help them understand that there was no financial obligation to use up

655their prior membership term. Paramount's sauna, steam room, and other equipment

666are all in good working order. It has more aerobics classes than Sweetwater and

680includes special classes for seniors and other age or ability groups. In every

693way, save one, Paramount's facility is equal to, or better than Sweetwater;

705Paramount has no racquetball courts.

7106. Eleven complaints from former Sweetwater members were filed with the

721Department of Agriculture and Consumer Services.

7277. Some members who complained did not even visit Paramount. In some

739cases, they felt it was too far or inconvenient; in other cases, they knew it

754had no racquetball and that was the only reason they went to Sweetwater. Other

768members visited Paramount but perceived it to be crowded or too intimidating

780because of a younger aged clientele and body-building focus.

7898. With the exception of the lack of racquetball courts, the perception

801that Paramount is not equal to Sweetwater is not valid. Harry Meeks' testimony

814regarding the availability of equipment and broad appeal to all ages and skill

827levels was persuasive. Sweetwater was less crowded because it had lost its

839members already to Paramount.

8439. Former Sweetwater members, Ian Robertson, Ken Samsudean and James

853Hadley, utilized the Sweetwater facility exclusively for its racquetball courts.

863Former member, Chris Derato, used the facility primarily for the racquetball

874courts, but also used the other equipment at Sweetwater. James Byrd, former co-

887owner of Sweetwater, has agreed to refund the unused membership fees of those

900members who exclusively used the racquetball courts and to refund a portion of

913the unused fees to Chris Derato. (transcript, p.76) This stipulation

923effectively resolves the only valid complaints regarding Sweetwater's closing.


93510. The Division of Administrative Hearings has jurisdiction in this

945proceeding pursuant to section 120.57(1), F.S.

95111. The Department of Agriculture and Consumer Services is a state agency

963created pursuant to section 20.16, F.S. and is responsible for enforcing the

975provisions of sections 501.012-501.019, F.S., regulating health studios. It is

985uncontroverted that Sweetwater is a health studio subject to those provisions.

99612. Section 501.017(1)(b), F.S. provides that a contract for health studio

1007services must include:

1010(b)1. A provision for the cancellation and

1017refund of the contract if the contracting

1024business location of the health studio goes

1031out of business, or moves its facilities more

1039than 5 driving miles from the business

1046location designated in such contract and fails

1053to provide within 30 days, a facility of equal

1062quality located within 5 driving miles of the

1070business location designated in such contract

1076at no additional cost to the buyer.

1083. . .

10863. A provision that if the department

1093determines that a refund is due the buyer,

1101the refund shall be an amount computed by

1109dividing the contract price by the number of

1117weeks in the contract term and multiplying

1124the result by the number of weeks remaining

1132in the contract term.

1136. . .

113913. Rules adopted by the Department of Agriculture and Consumer Services

1150to implement sections 501.102-501.109, F.S. provide, in pertinent part:

11595J-4.003 Definitions. The definitions in

1164Section 501.0125, Florida Statutes, and the

1170following shall apply:

1173(1) Alternate facility - means a health

1180studio of equal quality offered by a health

1188studio which goes out of business or moves

1196its facilities more than 5 driving miles from

1204the business location designated in any

1210contract used by the health studio.

1216. . .

12195J-4.012 Facility of Equal Quality. For

1225purposes of Section 501.017, Florida Statutes,

1231and this chapter, the Department shall

1237consider the following factors in determining

1243equal quality among health studios:

1248(1) A comparison of equipment and facilities;

1255(2) The intended use of equipment and

1262facilities by the consumer;

1266(3) The availability of the equipment and

1273facilities for use on the same days and times

1282by the consumer;

1285(4) The distance between the facilities.

129114. Although certain members complained about the inconvenience of

1300Paramount, it is plainly within the 5 mile driving distance required by the

1313statute and rules. The testimony of complainants who never visited Paramount or

1325who visited the facility only once or twice, very superficially assessing its

1337quality, is outweighed by the testimony of Paramount's owner, Sweetwater's owner

1348and one former Sweetwater member who transferred to Paramount. With the

1359exception of the lack of racquetball courts, Paramount's equipment and

1369facilities are of equal or better quality than Sweetwater's. In some regard,

1381they are precisely the same, though Paramount refurbished Sweetwater's

1390equipment. There is no requirement in the law or rules that a member should

1404never have to wait to use equipment any time he or she patronizes the facility.

1419There was no waiting at Sweetwater for the very reason it closed: it had too few


143615. The Sweetwater members who testified about their exclusive use of the

1448racquetball courts were credible. The sign-in sheets received into evidence as

1459Respondent's exhibit #1 are not reliable evidence of non-use, as the sheets are

1472for the last few days that Sweetwater remained open. As provided in finding of

1486fact #9, above, Respondent has agreed to make pro-rated membership refunds to

1498the racquetball users.


1502Based on the foregoing, it is, hereby,


1510That the Florida Department of Agriculture and Consumer Services enter a

1521final order denying the complaints against Respondent, with the exception of the

1533complaints by Chris Derato, Ian Robertson, Ken Samsundean and James Hadley; and

1545granting thirty (30) days for Respondent to provide refunds to those members,

1557before proceeding against Respondent's surety as provided in section 501.016(1),


1568DONE AND RECOMMENDED this 13th day of May, 1994, in Tallahassee, Leon

1580County, Florida.



1585Hearing Officer

1587Division of Administrative Hearings

1591The DeSoto Building

15941230 Apalachee Parkway

1597Tallahassee, Florida 32399-1550


1601Filed with the Clerk of the

1607Division of Administrative Hearings

1611this 13th day of May, 1994.


1624The following constitute specific rulings on the findings of fact proposed

1635by the parties.

1638Petitioner's Proposed Findings

16411. and 2. Adopted in paragraph 1.

16483. Adopted in paragraph 4.

16534. Adopted in paragraph 6 and in preliminary statement.

16625. Addressed in preliminary statement.

16676. - 9. Adopted in paragraph 5.

167410. - 12. Adopted in paragraph 7.

168113. Adopted in substance in paragraph 9.

168814. - 15. Rejected as statements in of testimony, but addressed in

1700conclusions of law, paragraph 14.

170516. Rejected as contrary to the greater weight of evidence.

1715Respondent's Proposed Findings

17181. Adopted in paragraphs 1 and 4.

17252. Adopted in paragraphs 3 and 4.

17323. Adopted in paragraph 5.

17374. Adopted in paragraphs 3 and 5.

17445. Adopted in paragraph 5.

17496. Adopted in paragraph 9.

17547. - 8. Adopted in paragraphs 3 and 7.

17639. & 10. Adopted in substance in paragraph 2.

177211. Rejected as immaterial. Upon review of the factors in rule 5J-

17844.012, F.A.C. it appears that the lack of racquetball courts at Paramount is a

1798material defect, as to those members who used the courts at Sweetwater. As

1811noted in Mr. Rommes' letter, as long as the health studio is still in existence,

1826its members might have a cause of action for breach of contract. The purpose of

1841the statutes and rules seems to be the protection of those members who may

1855otherwise be without practical recourse if the studio closed.


1866Isadore Rommes, Sr. Atty.

1870Department of Agriculture

1873and Consumer Services

1876515 Mayo Building

1879Tallahassee, Florida 32399-0800

1882James S. Byrd, Jr., Esquire

1887Post Office Box 2187

1891Winter Park, Florida 32790-2187

1895Richard Tritschler, General Counsel

1899Department of Agriculture

1902and Consumer Services

1905The Capitol, PL-10

1908Tallahassee, Florida 32399-0810

1911Honorable Bob Crawford

1914Department of Agriculture

1917and Consumer Services

1920The Capitol, PL-10

1923Tallahassee, Florida 32399-0810


1932All parties have the right to submit written exceptions to this Recommended

1944Order. All agencies allow each party at least 10 days in which to submit

1958written exceptions. Some agencies allow a larger period within which to submit

1970written exceptions. You should contact the agency that will issue the final

1982order in this case concerning agency rules on the deadline for filing exceptions

1995to this Recommended Order. Any exceptions to this Recommended Order should be

2007filed with the agency that will issue the final order in this case.

Select the PDF icon to view the document.
Date: 06/20/1994
Proceedings: Final Order filed.
Date: 06/16/1994
Proceedings: Agency Final Order
Date: 06/16/1994
Proceedings: Recommended Order
Date: 05/13/1994
Proceedings: Recommended Order sent out. CASE CLOSED. Hearing held February 9, 1994.
Date: 03/31/1994
Proceedings: (Proposed Recommended) Order; CC: Racquetball Log; & Cover Letter from J. Byrd filed.
Date: 03/03/1994
Proceedings: Department`s Proposed Recommended Order & Cover Letter from I. Rommes filed.
Date: 02/25/1994
Proceedings: Transcript of Proceedings ; & CC: Cover Letter to I. Rommes from R. Mott filed.
Date: 02/09/1994
Proceedings: CASE STATUS: Hearing Held.
Date: 02/04/1994
Proceedings: Joint Response to Prehearing Order filed.
Date: 11/04/1993
Proceedings: Prehearing Order sent out.
Date: 11/04/1993
Proceedings: Notice of Hearing sent out. (hearing set for 2/9/94; 9:00am; Orlando)
Date: 09/21/1993
Proceedings: Petitioner's Response to Initial Order filed.
Date: 09/07/1993
Proceedings: Initial Order issued.
Date: 08/31/1993
Proceedings: Agency referral letter; Agency Action Letter; Petition For Formal Hearing; Supportive Documents filed.

Case Information

Date Filed:
Date Assignment:
Last Docket Entry:
Orlando, Florida

Related DOAH Cases(s) (1):

Related Florida Statute(s) (4):

Related Florida Rule(s) (1):