While you are getting the right advise from other members above, I am quite curious to know why a host would say something like this:
Originally Posted by brucanik
I posted on another web host board that the only reason I could think of why they would keep my money is because they are in financial trouble and they told me were given legal advice not to have any further contact with me and they suggested that I delete the statement I made.
In my opinion, this is a typical reaction of a hosting company that is run by immature management, nor do they get any real legal advise. It sounds like they simply are trying a little scare tactic, throw some "legal" language into the pool and see what happens... Since they know very few consumers actually sue hosting companies.
However, there is no reason why they would tell you they were given legal advice not to have furher contact with you, unless you DID threaten them with legal action. So my question to you is: did you? If you did, then they CAN cut communication with you and refer you to their legal department/contanct. If you honestly did NOT threaten them with legal action, then my money is that they are lying to you about the whole thing.
Now, suppose you did not threaten them. Their TOS, as you suggested, allows for a 14 day window to receive a refund on service that you pretty much cancelled before its renewal date. In such a case, if you did not host/involve in any illegal activity and did not break their terms of service, "(2) Refunds are issued at the management's discretion" will never hold up in court.
For further advise, I would have really liked to know whether you did threaten them with legal action or not though.