Thanks for all the replies, all very useful and just goes to show that the regulations are ambiguous even for professionals.
I'm a heating engineer by trade so I'm used to it myself.
All the points raised here, I have questioned myself. I'd also agree that if I could build on the boundary, the neighbour could use that to their advantage and build off it. It would make perfect sense!
Anyway, I have been away for a few days and the neighbour has snuck up the path and taken photos, only to be caught by my misses who was go smacked at his childish behaviour. I have since seen him and offered to talk about things amicably so we can raise our concerns, but the guy is a complete pansy and wouldn't even let me talk. Apparently it's all gone to his solicitor.
To clarify: the property is a terrace house, so surely the boundary exists on the party wall which adjoins the houses? Ie dead centre of that wall?
So by that definition, the boundary will also carry on from this point externally? Even if it changes angle, the wall is slap bang on the boundary at that point in which it joins the house wall. We both also have a pier either side which protrudes further.
Originally, when it was build (ex council) their was a wire on wooden posts separating the gardens. On either side of the wire was a poured concrete path, the two paths were obviously poured seperately, as there is a join in the middle, under where the wire would be.
At some point, the wall was built on top of this joint. When I removed my concrete path, the concrete fell away with ease to the joint, hence why the wall looks to have no purpose provided footings and why it looks like this guy is basically trying to extort some cash out of me by filling a claim on me.