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ProfessorPlum's Replies
1. Matty was setting Ned up to not only take the fall for her husband's death but her own as well. By making the bomb similar to the one that burned up her husband, she insures they find "her body" in the boathouse and Ned takes the fall for her death as well. The police wouldn't believe that she would trigger the boathouse bomb herself, if she had rigged it explode.
2. Ned was shown representing a client in a criminal case of fraud against the town at the beginning of the movie. So he handled criminal and (as we see later when he is talking with the older lady about her health problems) civil cases. Not only is he around the courthouse all the time, but he eats lunch with the DAs and police and is friends with them.
3. The whole second half of the movie is a long list of the ways that Matty is setting him up to be arrested for her husband's death. In addition to being actually guilty of the crime, Matty destroys his alibi, produces her husband's glasses, and even implicates him by pretending he was the one that prepared the flawed updated will. And she insists on flagrantly continuing their affair immediately after the will is read. Everything she does piles on to give the police enough for a conviction . . . and then she frames him for her own death as well.
Ned unwrapped him before starting the fire, and he also made a point of trapping the body under something heavy to make it look like Edmund had set the incendiary device, then got caught under a heavy beam. He was definitely trying to make it look like Edmund was starting the fire to commit insurance fraud and killed himself by accident.