The question isn't whether or not it's an acceptable way of terminating an agreement, the question is how does a merchant act properly in handling such a situat

The question isn't whether or not it's an acceptable way of terminating an agreement, the question is how does a merchant act properly in handling such a situation. Calling the creditors when a) the missed payment is for a pre-paid service; b) is a small amount; and c) the service hasn't been used by the customer... is completely inappropriate. Even more inappropriate is when a merchant builds their entire business model based on a combination of infrequent auto-renewing payments, a complicated cancelation process, and crazy cancelation terms. Canceling at some gyms, for example, is more complicated and requires more effort and notice than leaving an apartment. That's sneaky (and by design). Is it stupid to cancel your cards as a way of ending your contracts? Yes. Is it stupid to take draconian measures to get money from a customer who doesn't want and hasn't used your service? Yes.