His claim is the recently deceased owner of an adjacent property allowed him to build there.

In other words, if we believe his version, he had been allowed to live there legally the entire time he's been there. His friend dies and now the neighbor, who was probably upset he could do nothing about the guy, now claims he's trespassing on the dead man's property.

If that account is correct, it's possible the fire was an attempt to destroy any evidence River Dave may have had of that agreement.