[tophcfa]

I think you handled the situation very well and have no responsibility to remove the tree. However, let me give you a little advise based on my experience with magnolia trees. Do yourself a favor and use this episode as an excuse to get rid of the magnolia tree. In a few years you will wish you never planted the dam tree. We regretted having a magnolia on our property. These trees grow very big (not just tall but very wide) and create a mess. They constantly drop these rather large and spinny cones everywhere and their leaves make a mess, including clogging your gutters. You will be constantly cleaning up the trees debris. It also becomes very difficult to grow decent grass anywhere near the tree canopy and your lawnmower will learn to hate the trees cones. And if you wait until the tree grows big to take it down you will have to jump through loops with the ARC and pay someone big $$ to remove and replace it. Plus, the now extensive and shallow tree root system will then rot underground and create a fungus that will kill all your grass. Three years after removing our magnolia we are finally getting something that resembles a lawn, but we constantly need to add fill as the lawn depresses where the roots have rotted out.

So my advise would be to get rid of the magnolia for you, not your neighbor. But you will get a double win since your neighbor will think you did it for her : ).