This sounds to me that the horse owner was pushed into this proposition. I'm not at all saying that your were wrong in helping this horse as it was a pretty **** noble thing to do; But to expect payment from a guy who OBVIOUSLY doesnt give two hoots about his horse (judging by old uncared for wounds , dirty stall and what not) was where you slipped up.
Maybe instead of pushing him to let you pay, you could have pushed him to sign the horse over to you- it would have been much more of an appealing option at the time when the horse needed vet care- now the horse has seen a vet THAT HE DIDNT HAVE TO PAY FOR, while you are basically taking care of the horse- it almost seems to me he's waiting for you to make a money offer to get the horse away from him instead of just signing it over to you.
If I were you, I would wash my hands of it (poor horse I KNOW), accept the fact that you DONATED money to a worthless human being.. and in a few days when the horse is standing in his own filth with a nasty infection- CALL THE SPCA (you are so lucky to have access to these people!!) and let them assess the situation, because it seems to me that you are enabling the situation to continue.
As for who is responsible for damages I think it would depend on boarding contract. When I boarded MY b/os had a clause, that while they kept the place safe and horsefriendly, they were NOT responsible for horses being horses and injuring themselves or others. If the place was that unkept and discusting, and you still decided to board there its kinda your fault as the horse owner that your horse hurt itself/someone elses horse.