We had a similar situation with a grand piano that has become a family heirloom.
When my father-in-law and his sister were kids, their parents bought them a baby grand piano and arranged piano lessons for both. My FIL's sister showed no aptitude for, or interest in, playing the piano. My FIL, on the other hand, became an excellent piano player, played a piano in a dance band at one time, and became a church organist.
All of these years, the piano was in my FIL's possession. He paid for periodic tuning and upkeep. Time passed, both my FIL and his sister raised families, were eventually overtaken by old age, and passed away. As my wife is an only child, upon her parents deaths the piano was passed on to her. It is now in our house.
Now the interesting part. While a cousin of my wife's (the son of my FIL's sister) was visiting from out of state about 10 years ago, he made an offhand comment that he was glad we'd taken such good care of "his mother's" piano over the years. It was obvious he considered the piano his, with us merely being caretakers. Nothing further was said at the time, but I immediately talked to our attorney.
Our attorney's opinion was, "Possession is nine points of the law. The piano has been in your father-in-law's possession all these years, and now yours. Your wife's cousin has never once offered to share in the cost of tuning and maintenance. As far as I'm concerned, it's your piano. If your wife's cousin ever seriously tries to claim it, hit him with 60 year's storage at $1200 per year."
Didn't mean to get long winded, but assuming there was at least a number of years that your neighbor's father could have retrieved the item, had he felt he still owned it, I'd say the first thing you need to do with your neighbor is discuss the price of the repairs that were made and 20 year's storage.
I'd also say get it resolved soon. No point in letting it fester for another 20 years.
(Our problem solved itself when the cousin croaked fairly young several years ago).
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