How would you handle this dispute with a rehabber?

[Scott Taylor]

I had a rehab project to fix up a unit. Rehab project was supposed to cost $50k.

The unit involved was a small studio; under it, a garage. This was renting for around $700 (garage for an additional $100). 

The unit was wrecked but I was sold a rehab project that would be much more expensive so that the unit could be converted into a bigger living space; the idea being that we could get more rent out of it (close to $1200 vs. $800/mo).

The rehab was supposed to take ~ 3mo. It ended up taking around a year.

During this, the rehabber was not responsive to my calls/texts. Meanwhile, the city was also fining me for the unit not being up to code.

After the project completed, I got a trumped up bill, asking for roughly $10k more (~ $60k). 

I had not agreed to any of these additional charges before the rehab was completed and was surprised when I was sent the final bill. 

Also, because of code issues, the unit can't rent as a larger 2 bdr. on two floors so is still a garage + studio/small 1bdr, so the whole point of a doing a larger rehab was pointless. (in fact, the rehabber had extra expenses because they had to fire rate the garage).

Further, I'm out of roughly 9 months of rent (@1k per month = ~ 9k).

How would you handle this?