Never begin work on a project without a signed and clearly defined contract in place.
always charge as large % of the invoice as possible before handing off the material.
I've no idea what world you guys work in, but it's not one I've ever seen, and I'm not sure many other people have either.
The positive advice I can offer is that if something about the job doesn't seem right - money, circumstances, people - if you have even the tiniest suspicion about anything, get everything in writing. I'm not talking about contractual stuff. That's nice to have. But if you are in the middle of the job saying something like "If we don't X, Y will happen," make sure that the person you're talking to gets it by email and responds that they've seen the email. The phrase "well, I'll follow that instruction since you're the boss, but I'm going to need it in an email" is a surprisingly powerful way of expressing your concerns with things you've been told to do.
And finally, if it's all going south, walk away. It's the only way to escape with even a shred of dignity intact.