Can a business refuse cash as payment of a debt and, if they do, does that voidthe debt?

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Can a business refuse cash as payment of a debt and, if they do, does that voidthe debt?

I joined a fitness gym, on a 1 year contract, and was told they needed to set up automatic monthly debit on my checking account. I tried to pay the entire year with 1 cash payment and was told they would not accept cash only the auto withdrawal.

Asked on September 4, 2010 under General Practice, Alabama

Answers:

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

A business can set up the terms of their business agreements and you can agree or not to the terms.  That is known as the freedom to contract, although it does not seem like you have any "freedoms" here, right?  The freedom is that you can choose not to join.  But if you agree to the contract terms then you are bound by them.  Although I agree that it seems foolish to turn away business in this day and age, in fact that is what they are doing with you.  You can see if you can try and join a different gym under the terms you wish.  Otherwise, consider the automatic debits.  Good luck.


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