Can a service provider change prices on you without letting you know beforehand?

Our business deals with a trucking company that moves around our containers in our suppliers lot, recently we noticed an increase of 40%,when we asked the reasoning for the increase they said that the supplier had given them consent to raise prices , yet we are the ones paying for the service not the supplier. Is this allowed?

Asked on July 20, 2015 under Business Law, California

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

It is not allowed unless the terms of service/contract between you specifically allows it--e.g. those terms state that any price increase shall be passed on to you, or you shall pay the trucking company's cost plus some profit margin, etc. If the contract, etc. states that, it is legal, though if you don't believe the alleged price increase, you could still ask for proof (and if the don't/won't provide it, take legal action, if necessary, to recover what you feel is an improper increase).

If there is no authority in the contract or written terms of service for them to simply pass on their own cost increases, then they may not increase your costs without prior (i.e. before the increase) notice, since you are only responsible for paying those amounts to which you agreed.


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