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in all respect to your friend- dont hang your hopes on the small claims court,any settlement (assuming he has the means to pay)can take months or years to come through. over the years plenty of other people have been duped by the same misinformation as your mates car.
if the engines out and split he,s already saved a few hundred quid in stripping fees-if he wants to carry on with a rebuild.
Yes we have told him this it's going to be a long journey to get any were ... he has already got a new block and heads , this was when the sump come off