I need advice from a contractor/ Partner in a flip

[Joanne Bragg]

I bought a piece of property, in Riverside California for 305,000 after renovation of 100,000 it would be worth 750,000. Sweet deal with built in equity. I arranged the financing with no money out of pocket and even leaving 30,000 in the account for renovation. I asked my friend who was a contractor if he wanted to be my partner. He would need to come up with the other 70,000 to rehab. We would split 50/50 profits. seemed simple and fair. But he then told me he does not do this work for free, and his labor would be 100,000 which he said was normal labor to renovate. 1,000 per day. Because I would not agree to sign his agreement, he used that has an excuse because it has taken 6 months so far and only 30% done. We have a 5,000-interest payment due monthly, that would have been ok if we had completed in 4 months. He has another at least 6 more months or more to finish. He says because I am not signing this contract that gives him 170,000 contributions and he gave me class B and himself class A with controlling vote.

On top of that the first 30,000 I put in, he spent 15,000 on his own personal expenses i.e. food, gas, phone bills, Starbucks, lunches, girlfriend dinners, wrote himself checks, bought himself a car and I can go on... but he says that's part of his business expenses. There is no more money that I know of so he will be doing by himself without a crew. The problem is I never hired him as a contractor but a 50 % partner.

Is this the going rate for contractors to renovate property. It's just a 4 bd 3 bath with a pool. Just to flip property in the 750,000 range? So why does he get 50% partnership if he is a charging labor and materials for 170000. He also says he doesn't have to give an accounting for what he spends.

I am just lost and depressed. It's my fault I didn't have the agreement signed immediately but he was my friend for 5 yrs. I feel like a failure because other people are relying on me

Can't take him to the contractor's board because he is only a partner

Can anyone give me any ideas of suggestions of what I can do?

I am desperate

Or I am just a screwup and should probably walk away

;