The payment dispute is a case he has opened with Paypal. They allow buyers 180 days to open a case for a faulty item but, because payments are managed by Ebay, you will respond to Paypal via Ebay.
Look up 'payment dispute' using 'help & contact' top left of your Ebay page for details.
But, briefly:
You have 5 days to respond to the case.
You can accept the case and refund - the buyer should be asked to return the item to you. As well as the refund to the buyer, there is a £16.80p dispute charge. If you accept the dispute and refund, Ebay will repay this fee to you.
Or, you can challenge. You have one chance to provide 'new evidence'. In practice, this is virtually impossible because you don't have the disputed item and the Paypal customer is claiming it is damaged. If you lose the case, you also lose the dispute fee.
"There are two ways to be fooled. One is to believe what isn't true; the other is to refuse to believe what is true.”
Søren Kierkegaard, Danish philosopher (1813 - 1855)
Message 12 of 21