Incorrect: "James' friend" (the singular possessive)

Incorrect: James' friend.
Correct: James's friend.

"James' friend" would mean that there are several Jameses, and that the friend in question is one all the Jameses share in common. That's probably not what you want.

"James's friend" is a friend of James. That's the one you want. Form the possessive of singular nouns by adding

's

even when the singular noun is a name that ends with "s."

EXCEPTIONS
(The possessives of ancient deities or prophets)
Isis' temple
Moses' Laws
Zeus' whim