An unauthorized payment occurs when money is sent from a PayPal account and the account owner did not authorize or benefit from that payment. For example, if someone steals a user’s password, uses the password to access the user’s PayPal account, and sends a payment from that account, that payment is unauthorized. In addition, payments sent using a stolen bank account or credit card information are also unauthorized.
1. Who's liable for this?
To be honest, there are several scenarios to this. The buyer may be liable due to removing himself from eBay, thus registering him as unauthorized. Or different account details were encoded on either eBay or Paypal.
2. How long can a dispute like this last
PayPal will place a temporary hold on the transaction amount while we make sure the transaction is eligible for coverage. Once we validate your shipping documentation, if the transaction is covered under Seller Protection, we will lift the temporary hold and restore your access to the funds. If it is not covered, we will return the funds to the buyer's account and you may be responsible for PayPal's chargeback fee, if applicable.
3. How can i prevent this from the future.
According to the seller protection program:
To be eligible for Seller Protection, you'll need to meet each of the following requirements:
You must send the item to the shipping address on the Transaction Details page.
You must respond to PayPal's requests for documentation and other information in a timely manner.
The item must be a physical, tangible good that can be shipped.
(Example: a DVD is eligible but an MP3 file is not)
Your primary residence, as listed in your PayPal account, must be in the United States.
We recommend that you ship the item within 7 days of receipt of payment. Or, if the payment is for pre-ordered or made-to-order goods, it must be shipped within the timeframe specified in your item listing.
4. How can eBay even let this happen anyhow.
I am not sure entirely but I do know that there was something wrong with how the buyer had access to eBay and had processed a transaction when he is unauthorized. It may again be due to the details of his account - they might not have matched at all.
5. Would i likely to win the case since have a physical proof of that quote to ship the item to India
Do you still have a snapshot of the transaction detail between you and the buyer? If you are responding to a claim or a chargeback for an unauthorized payment, you can fax or upload scanned images of your proof of shipment in the Resolution Center.
Hope this helps.