Legal Question in Business Law in California

It depends on what was bought and sold between the owner of the old and new gyms. Without knowing that it is impossible to say who has what obligations to you. If the new owner actually bought the entire business, the assets and liabilities went with it, and that includes your contract as written, meaning you both are obligated under the original terms. If he only bought assets or a customer list or something like that, the new owner has no obligations to you, but if you want to cancel your contract he has no right to object either. You would then have a breach of contract action against the original owner.

This type of situation is why business owners, and those who are purchasing a business, need to be careful, conduct proper due diligence (i.e., investigation), and understand what they are buying and what they are selling.

Your answer depends on what you want your answer to be, because there are lots of facts to consider, and you can argue it both ways. If you want to keep your contract because he's raised the rates, and he's offered to let you keep it, then say thank you and keep the status quo. If he won't let you, then you need a lawyer to threaten to sue him (and the prior owner), and he will then honor the contract. If you have more detailed questions, email me at [email protected]