I think you reaction is overreacted. First, your neighbor is doing house improvement that will add value to you house as well. Second, He is intending to dig a gut between two houses, and that will benifit both of the houses. Water bed is major reason causing fundataion issue in USA, especially his patio is higher than yours; Third, what your neighbor is doing is based on the middle line, if his project did not impact your living and damage your house and property, no court will support your case except his encroachment is obvious, and I did see here; Finally, look at your yard, hard to say maintained properly;
But you do have the rights to ask him clean up and finish!
