He is in a house where a friend of his son is in great trouble. Some kind of legal trouble. A policewoman and a policeman are standing next to him to take him away. But the son's friend does not have proper black pants to wear which once he gets and puts it on they can take him away. The dreamer is offering the young man to take his black trousers - quite a few of which the son's friend is trying - but none of them are quite fitting him. It looks like he is purposely not trying on the right pants and in addition is doing some purposeless wasteful actions delaying everything instead of putting on those pants the way he should and leave with the police. This is making the dreamer angry that the kid is incompetent and will not amount to anything.
The day before the dreamer had been going through his closet and had noticed how many of his black pants which were just lying there, never worn, because they were too tight, were now fitting him well and as an irony the ones which had been fitting him well, were now too baggy because of the weight loss and it had taken him some time to decide which pants to wear and while he was sifting through those black trousers the thought had passed through his mind that soon he will be wearing none of them.
In the dream this process of deciding upon which black trousers to wear had been projected upon his son's friend and had been made a ground for accusing him of being incompetent and someone who will amount to nothing. Since black, as much as white, shroud/cloth often symbolizes death, the black trousers symbolized death, which the dreamer was trying to escape by pushing it from himself upon the young lad and getting angry and accusing him of incompetence for not readily accepting it.
The two police were death itself, which had come to take him away but which the wish fulfillment had shifted it from himself to the young man. It is he who is in trouble with the police (death) not me. The accusation of incompetence was actually reversal of the realization, in service of the wish fulfillment, that the young kid is too smart to be pressured into accepting the fate of the dying old man upon himself.