Aggressive and naught three year old

My cousin lives at our house some of the time. He's three years old. He says things like "I don't like you anymore" and "I'm gonna punch you" and he will yell at scream at you if you ask him if he has to go potty. He's currently on time out for throwing a cup of apple sauce and then pushing his high chair tray onto the floor and telling my aunt he'll punch her. I need help. I try to discipline him but it doesn't work because his dad (my cousin who lives with us) just spanks him and yells back. It really does nothing. Do not tell me to spank this kid because it makes it worse. His parents are separated and I have no idea how his mom disciplines him. Right now his dad came in and now he's talking to him though I was ignoring his threats while on time out because once you feed into him, he just keeps going. It's frustrating because we can't discipline him the way we want or else his dad will get annoyed, but we have to watch him and deal with his poor behavior. Any help?