Question

tree-1  

roots-1   My 'neighbour' (a commercial property owner) is repaving his lot...in the process, he had his backhoe operator dig down about 3 feet - right at the base - of a 100 year old walnut that borders the property line and tear out the roots across at least 30 - 35 percent of the diameter of the tree. The lateral roots in question were as large as 6 - 8 inches in diameter and as long as 8 - 10 feet. I believe his actions were a deliberate attempt to kill the tree

The first question is - what is the probability of these actions being fatal to the tree?

The second question would be - now that the integrity of the root system has been severely compromised on one side, what would you estimate the increased risk of the tree falling in a wind storm might be? (my house is only about 10 feet from the tree, and all of the damage is - parallel too, and on the far side of the tree in relation to my building)

Answer
You are not going to like my answer. Looking at the pictures (thanks for sending them) I would say the majority of the root system has been effected--either by the digging or previous pavement. The area in grass is where most of the roots system will be after the digging. Dr. Tom Smiley at the Bartlett Tree Research Laboratory in Charlotte showed that roots on one side of very young trees can be pruned off completely at a distance equal to 5 times the trunk diameter without any impact on tree stability. Which ever rule-of-thumb you decide to use, do so knowing that pruning roots on trees can result in trees falling over or dying. While root pruned large trees on well drained soil may not fall over because of deeper sinker roots under the trunk, they can and have. There are fewer deep roots holding the tree up on poorly drained and compacted soils. This would mean a 10 inch diameter tree would need 50 inches away from the trunk.
I think you will at the very least get dieback of limbs on the dug side and as much as 50% of the crown could die. It could result in the death of the tree. The stability will be compromised greatly and winds from the non grass side could topple the tree. This is a problem IF the tree is tall enough that if it fell it would hit a structure?. As you say your house is 10 feet from the tree then this is a problem. This as Dr. Smiley says depends on the soil type. Sandy soils will have deeper roots than clay compacted soils. I would guess that these soils are compacted especially on the paved side. So I would say there would be a high risk of the tree falling in a wind storm if the wind is blowing toward your house. Sorry that is probably not what you wanted to hear.