Don't take this as legal advice, but in the US I'd rather saw off my right arm than hire a lawyer, especially if I'm out no money. They are generally super expensive and often of dubious honestly. Maybe in the UK it's different. Once I got into a legal battle over the sale of a house. I ended up representing myself. We eventually settled, but the other guy paid 10k to his lawyer to get 3k.

If I were you I'd tell him he's terminated for failing produce what you need and get someone else. IMO it's not reasonable to demand money up front unless you explicitly agreed to it. Make him hire the lawyer if he wants to pursue it.

You guys signed a salad leaf, and not a contract. I suggest you to pay him in multiple chunks upon delivering the assets one by one as he is proceeding with the work. If he refuse to agree, terminate the ,,contract''.

Hello,

I'm sorry about your situation.

One law snippet I always remember and has helped me in a number of situations is something like “ambiguity in a contract automatically benefits the party that did not draft it”. Now, I got this from "The Big Bang Theory", but I have found it to be true based on my experience. I have cancelled at least 3 contracts with large corporations that were providing a bad service, without penalty.

In this case, since the artist drafted the contract, then those parts of the contract that seem vague, can be interpreted by you in such a fashion that benefits you. Within the law of course.

The Client shall pay the agreed upon amount of [redacted] € for the Character models/Game assets creation services as the fees of the Artist (Exact scope of work listed in Annexure A).

My interpretation of this is that you pay the artist for the assets. If the assets do not yet exist then you are not obligated to pay. I think this is pretty cut and dry.

I'm sure there are other ambiguous parts of your contract that you can interpret in a way that indicates a breach, and I personally would do so as this artist appears to be unprofessional based on what you have described.