When is the right time to terminate your retainer with a client? There can be many reasons for doing so.

At the top of the list of troubles that solicitors have with clients are: failure to pay  invoices, and failure to give meaningful instructions. The second one seems to cause the most concern among practitioners, whilst the first is probably the most common.
Clients sometimes appear to make decisions which appear foolish and against their own best interest. At some point this becomes a medical issue and then an appropriately qualified medical practitioner determines whether they still have mental capacity to manage their own affairs. Before that occurs there is a great expanse of ‘grey area’ in which an apparently sane (albeit eccentric) client is giving you, the legal practitioner, some pretty loopy instructions.
I once attended a very good CLE seminar in which an eminent psychiatrist made the point that the fact that a person regularly makes decisions against their own best interest is not of itself conclusive of insanity. Very insightful I think, but it probably raises more questions than it answers.
I have found it helpful to approach this issue from a limitation of liability perspective. That is, confirming instructions in writing, the advice given, the subsequent instructions, your opinion that the informed instructions may bring about a negative result for the client, and so on. Politely but firmly terminating the retainer by way of a letter of advice that confirms the clients instructions and sets out their options I have found to be most helpful.
Most helpful of all is having a good retainer or fee agreement. This is best put in place at the beginning of the client engagement. Well drafted terms of engagement between the practitioner and a client spell out exactly what might happen if a client fails to pay their bills or provide meaningful instructions. It should also give the practitioner a wide discretion to refuse to act. If such terms are given to the client at the beginning of the business relationship, the practitioner will have plenty of escape routes later on, should that become necessary.

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