If you interfere with the sale, you may well be exposing yourself to a law suit. That is because if a court later determines that you took action that was not warranted, or asserted facts that aren't true and as a result the buyer withdrew, it is possible a court would order you to compensate the seller for damages reflecting his loss as a result. The damages in such a case could be significant if he has to remarket the property and/or does not find a buyer willing to pay the price that would have been paid if you had not intereferred and or the costs of remarketing the property.
For this reason you should only consider interferring if you have a very firm legal basis for interfering.
Be aware that boundary claims are not always easy to predict if they are long standing, as a neighbour can acquire permanent rights to land if an encroachment goes on for many years due to the application of 'adverse possession' and even if the encroachment of a building was unauthorised, a court may be persuaded to alter the boundaries (generally with compensation) rather than order the building removed.
Each case turns on its merits and the above is a general explanation of what may happen if you interfere, but only a fully briefed lawyer familiar with the history of the land encroachment and the nature of the properties involved, can give you a firm answer as to what will happen, and given the possible risks of interefering, I would strongly suggest you engage and fully brief a lawyer to look at your situation carefully before acting to prevent the sale.
I appreciate this is likely not the answer you were hoping for but it does reflect the legal reality of your situation, and I trust the above assists your understanding, and how you should proceed.
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