What should I do regarding a neighbor's demand that I contribute to the cost of burning another neighbor's car because of his complaint which led to the removal of encroachments that affected us all?

First, you must sincerely repent for participating in harming your neighbor, because harming a neighbor prevents one from entering Paradise and proves the lack of faith of the perpetrator. The neighbor has the right to complain to remove the harm. Burning a neighbor's car is a forbidden act that requires the perpetrator to seek forgiveness from his neighbor by paying the car's value; otherwise, it will be taken from his good deeds on the Day of Judgment, or he will bear the burden of his adversary's sins. The perpetrator's demand for you to contribute to the car burning operation is invalid, and you are not permitted to participate in it, as it falls under cooperation in sin and aggression.