Neighbor disconnected sewer line

[Zeb B.]

I have a friend who bought a property in a small town in Eastern Washington. It is an existing home which has been connected to city water and sewer since it was built about 25 years ago. His existing sewer lateral apparently runs under his neighbor's lot, to a manhole located in the neighbor's backyard, where both his and the neighbor's sewer laterals connect to another line that runs to the sewer main under the street. His neighbor decided that he doesn't want my friend's sewer line running under his yard, so the neighbor dug up the sewer lateral, cut and capped the sewer near the property line. I believe the neighbor has some beef with the city, and is trying to use this issue to create a problem for the city, my friend is just the unlucky guy who gets to be collateral damage.

The small town utility department doesn't have record drawings of the laterals, and they are not being too helpful. The prior owner that my friend bought the house from had been using city water and sewer (and paying water/sewer bills) for 25 years. The city set up a water/sewer account for my friend, but now that this situation came up, they told him they won't be billing him for the sewer charges.

If we can't get the situation rectified talking to the city utility department, where do we turn to next? Real estate attorney? State health department? 

Would the existing 25 year old sewer lateral qualify for a prescriptive easement if there is no recorded easement found? What agency would make that determination? What recourse do we have against the neighbor for taking matters into his own hands?

Not sure where to start untangling this mess...