Property investment with another couple turns sour

Hi,

Thought I would post my current experiences investing with another couple. We purchased several properties with another couple through a property trust, several years ago, (this was their idea and we went along with it, as they have had properties longer than us). We also bought 2 houses in our own name along side two houses they own themselves. The idea was to eventually knock the 4 houses down, and subdivide. In the meantime the idea was that we would manage all these properties between the two couples together. My husband and I also spent 7 months renovating the other couple's house that they bought in their own name, with the expectation that we share in the rental income, and pay all outgoing bills. This process of managing the properties together continued for several years, which are approx 1 hours drive from where we both live. However, in these years of managing the properties together we have also had alot of tenant problems (as the houses are in a low socio-economic area). After several years of abusive tenants, weeks/months of no paying rent, squatters, us hiding around streets at night trying to catch tenants, tribunal hearings, I had enough of it all. I could no longer cope with the situation. It was always expected that my husband and I would drop everything we were doing, take time off work, cancel the kids sport committments, or drive up to the properties at night after being at work all day, so we could 'fix' the tenant problems. According to the other couple 'the properties were always more important than anything else we had going in our life'. The wife of the other couple appeared to have an unusual fixation with managing the properties, and being in control of how things were run. It got to the point that I also felt like an unpaid employee, doing her bidding whenever she wanted. I have numerous examples that would make you laugh (me cry).

Anyway, the last few months have been very difficult with tenants, and my stress levels were at an all time high. I have had a bleeding ulcer in the past, and was scared of it returning. I spoke to the wife of the other couple and told her that this was too stressful for our family to continue this pace, and I think getting an agent would help reduce the stress of managing these properties for all concerned. I should have been more honest and highlight to her that it was her that was causing alot of my stress as well, but I didnt have the heart (foolish yes).
This didnt eventuate as she didnt want to pay agent's fees, didn't trust them, said we would still have issues. So it was expected that the situation continue as it was.
At this point I pulled away from managing the properties, and my husband started to act as the go-between, going up to the houses with the other couple for open inspections,etc, but I continued to with the admin stuff on our side, as I did not want to see them anymore, due tothe stressful situation. In the meantime, issues with the properties were escalating (insurance claims, broken windows with tenants fighting,etc), and I kept my distance. The other couple didnt like this situation with me, and we had a 'meeting' to resolve the issue.

At this meeting I suggested that we could perhaps sell the properties between ourselves, we were also willing to buy the least favourable properties from them, and they could buy us out of one or two of the better ones. This was the cheapest, easiest way than selling them on the open market, and paying agents' fees, which could take some time. The wife said 'no', and threatened that if she lost money in any transaction, she 'would come after me'. My husband brought up the idea again of getting an agent to manage the properties, and the meeting ended with us all resolving to do this once we got (yes another new tenant into one of the properties, as the tenant that was put in in the last couple of months was abusive to othe tenants).

After this meeting I sent an email to them stating what I thought the next process would in separating the managment of the properties. My email was informative, nice, and offerred suggestions as to how we could go about it. I also asked for the other parties input and thoughts.

I received no reply to this email, and today my husband went to yet another open inspection to find yet another new tenant. This was arranged in the meeting the week before that this would be one of the last things to do before we get an agent. I have since received a couple of quotes from agents, including one good one from one agent. He prices were competitive.
After the inspection was completed, this couple started being verbally abusive to my husband, said they better not see me in the street, I am a snob, etc. Started to bring up things that have occurred in the last few years, and recent months why they wernt happy with me. My husband was also trying to query a couple of unusual bank withdrawal transactions that were in the joint trust account, only to be told "it was none of our business"???? They also were saying that they dont want an agent for any proeprties they manage themselves, which sort of cancels all what the meeting was about the week before. At no point were my husband and I ever abusive or began a personal vendetta against them. My husband came home absolutely gutted and felt that the good outcome from the meeting the previous week was a huge step backwards.
My husband and I just want to part ways as we no longer want to be part of this partnership, and if we were unable to sell our share in the trust, an agent was the next best thing to avoid losing huge some of money trying to sell in this market. Having properties that have bad tenants is always a stressful situation, but try doing it with a couple who loves all the drama, but expects us to do the same?

I guess one question I have is, if we forced the issue of selling through the trust, and it goes to court can she take us back to court to reclaim her losses? There was no legal document drawn up in this partnership, except the trust document itself.

Thanks

Several years doen the track my husband's and my experience with