That happens all the time. Guy building the garage will probably claim the ground belongs to him; if you don't agree, take him to court. The farmer has to choose between giving giving up the ground or spending several thousand $$$ on surveyor and lawyer.
The first thing you should do when ground is subdivided is build a fence, and make sure you keep an eye one it. The smaller the lot the other guy bought, the more he covets the land around him. My neighbor's deed clearly states his lot is 200' across the front, but he was adamant that he owned 250' of frontage.
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