Years ago, I owned a convertable. I used to joke that I wasn't going to make my payments in the winter months. My logic was that I was paying for a convertable and if I couldn't put the top down, I shouldn't have to make payments. Of course, that is utterly ridiculous... but very similar to what your client seems to be saying.
You did the right thing... agreeing to their new terms would be insane and you clearly cannot make a living working for the low fees abstractors earn if they aren't even going to pay you for a large percentage of the work you do.
Best,
Robert A. Franco
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