You are in a bad spot for litigation. Without some form of proof, all they need do is deny the attack and you are then on the hook for costs.
You could file a report with animal control, any previous report would chalk a bad point for the neighbors dog.
Usually with legal matters I would suggest consulting an attorney.
>> If your neighbor did in fact confirm to police his dog attacked yours, there is the proof you need to win compensation for damages, including an official attack record to animal control.
Yes,I would file in small claims court. Your neighbor doesn't sound the sort I would tolerate.
I will point if you have leash laws where this happened, this could be found a no fault scenario.
I suggest consulting a lawyer.