Not sure what is going on with the tree. Check the roots with a soil probe, it may be too wet. If indeed it is too wet dig the tree and replant elsewhere or raise it.

As for the branches, scratch the bark. If the cambium is still green then leave them alone. If n not then prune them off removing the branch to green wood to facilitate scarring and avoid rot into the live tissue.

Scratching instead of breaking serves two purposes. One, if the branch/stem is green one has not lost the branch. Two, often in smaller woody plants, especially Acers from Japan, the interior of the branch is green for two years. Then it will turn white and only the cambium layer is green on live branches.

With the yellow lichens it sounds as if there may also be a nutrient issue. Have the soil tested if there is not a water problem. Too much water can inhibit nutrient uptake and if the tree has been "soggy" but still able to get oxygen to the roots then the nutrient deficiency is secondary to or a result of the water issue.