San Francisco Law Firm Loses Suit Over Undisclosed Fee Hike

The state Court of Appeal has ruled that law firms must notify clients before raising agreed-upon rates, a move that may make lawyers more careful in discussing fees.

The three-justice panel on Tuesday rejected a claim by Severson, Werson, Berke & Melchoir against Kenneth Bolinger, whom the San Francisco firm sued after he refused to pay raised rates he wasn’t notified about. The firm argued that an agreement to charge “regular hourly rates” meant that it could raise rates without warning.

The firm initially said it would charge Bolinger $110 an hour for services provided by a partner and $90 an hour for work by an associate. In two years, the partner rate rose to $160 an hour. In 3 1/2 years, the fee for an associate rose to $145.

Noting that lawyers have a “professional responsibility” to make billing procedures clear to clients, Justice Donald King wrote that “this responsibility logically precludes any changes in agreed-upon rates without notification.”