COLUMBIA — Despite MU’s efforts to shut down the privately owned tanning salon in the Student Recreation Complex, The Spa will remain open at least until December 2010 because of a court decision this week.
Since May 13, 2008, MU has tried to terminate its contract with The Spa because of the cancer risk associated with tanning beds. But The Spa’s owners, Terry Wilson and Randy Dawson, filed a breach-of-contract lawsuit against the UM System Board of Curators in July 2008.
After a year-and-a- half of legal battles, Boone County Circuit Judge Kevin Crane ruled in chambers Tuesday that the earliest MU can terminate its lease with Tan Time, the company that owns The Spa, is Dec. 31, 2010. In his decision, he also wrote that MU will not have to compensate Tan Time for lost profits and improvements of the leased space.
"We are glad to know that we can terminate the lease at the end of next year," Kelly Mescher, attorney for the Board of Curators, said. "We hoped that we would be able to terminate in less than a year because we had the provisions in the contract, and it's in the best interest of the students."
Thomas Schneider, attorney for Tan Time, said he also was happy overall with the judge's decision, but he was disappointed by the ruling against the damages.
MU added the sunless tanning services to the MU Student Recreation Complex after students expressed an interest in tanning and massages in a 2004 student survey, said Diane Dahlmann, director of MizzouRec services and facilities.
Tan Time won the bid in August 2006 and invested $250,000 to build The Spa.
In May 13, 2008, Dahlmann wrote a letter to Tan Time notifying the company that “in (the university's) best interest as determined by the university,” MU was canceling the contract effective July 31, 2008.
The university “wanted to be out of the tanning bed business because there is a concern about cancer,” Mescher said in a court hearing. The cancer risk was a “big issue” for MU Chancellor Brady Deaton, Mescher said.
Following Dahlmann’s written notice, Wilson and Dawson sued the university for terminating the lease, for damages related to the termination and interior improvements, and for failing to disclose that some medical school professors were opposed to tanning.
Tan Time's claim: The signed contract stated the lease will last until December 2010 and can be extended every two years until 2016. This arrangement can be terminated at the end of an annual term with a 60-day written notice, so the earliest MU can cancel the contract is December 2010.
Crane's ruling: The lease cannot be terminated until December 31, 2010.
Tan Time's claim: Tan Time says it lost $32,468 in sales August 2008 because MU closed The Spa for one week in August (before Tan Time received a temporary restraining order and a preliminary injunction).
Crane's ruling: Tan Time did not provide a pattern of lost net profits, and existing members could use Tan Time’s other facility, Tan Rio, on Forum Boulevard. "The opportunity for new memberships was merely delayed but not lost," he wrote.
Tan Time's claim: Tan Time asked for a compensation for its $250,000 investment in improving the interior of the leased space.
Crane's ruling: Tan Time "accepted the cost of the improvements as the cost of doing business at the recreation center for three years, and the court cannot rewrite the lease to give plaintiff a better bargain," he wrote.
Tan Time's claim: MU employees knew that one or more medical school professors opposed the tanning services before the business opened, and MU did not disclose this information to Tan Time.
Schneider dismissed this allegation in court in October.
Schneider said he has not had the chance to discuss the judgment with his clients yet, so he doesn't know if they would like to appeal.