More than four-fifths of City lawyers are prepared to drop clients in order to maximise profits, research revealed this week.

A survey of more than 200 City law firms conducted by corporate recovery practice Begbies Traynor found that 83% of solicitors said they would let go of clients in order to grow their firms.

Almost two-thirds of respondents said they had dropped a client in the past, and 15% admitted to releasing three clients or more in the last year.

Around a third of law firms - particularly larger firms - conduct monthly or quarterly reviews of client account profitability.

However, as many as 42% said they had regretted terminating a client retainer, of whom 43% said the decision had been a poor business move.

When it comes to terminating the relationship, more than half of solicitors questioned preferred a face-to-face discussion, with 54% considering e-mail to be the worst way to inform the client.

About half of clients had accepted the decision without feeling aggrieved.

Nick Hood, senior London partner of Begbies Traynor, said: 'Even the top City firms don't always get it right.

It's surprising that a fairly large percentage of the lawyers we spoke to have regretted letting clients go.

It is vital not to make rushed decisions, and to consider the possible business and financial implications of no longer having the client should activity levels fall away.'

Tony Williams, founder of legal management consultancy Jomati in the City, said: 'Law firms are mostly hopeless at letting go of clients - they tend to hold on to them as a security blanket even when they do not produce much work or cause conflicts.

They often use the argument that their client might become the next Microsoft, but realistically that is only going to happen to a small number of clients.'

He added: 'Law firms should look rigorously at their clients at least every year.

It's not about how much you are billing, it's about what percentage of legal spend you are getting - that is a better indication of what you can go for in those clients.'

Rachel Rothwell