Legal Question in Real Estate Law in California

The guy behind you bought and paid for the fence when he moved in. It became his at that point. The developer no longer had any right, title or interest in the fence, and therefore could not sell you a half interest. The fence payment you made to the developer didn't create a half interest, or any other interest, in the fence between you and this neighbor. At least, that's the way I see it, based on the facts given.

Actually, under Civil Code section 841, the neighbor could have asked you to pay 1/2 of the cost he incurred for the common fence, if your property is fully fenced.

Sounds to me as though the developer double-dipped in that it appears to have collected twice for the portion of fence in question. I'd go after them for the overpayment. There is a silly old saying, "He who sells what isn't his'n, must buy it back or go to prison."

I think a three-way negotiation, perhaps facilitiated by a mediator, might result in an agreement here. Your contract with the developer (who appears to be at fault in this mess) may call for mediation or arbitration of disputes already.