Toyota Repair: oil leak and more..., rear seal, oil spot

Question
QUESTION: My ’99 V-6, 96000mi Camry developed an oil leak several days ago. By the time I discovered it, it was dropping about 5-6” spot a day. I took it to a mechanic, who happened to be my friend (that’s what one of my problems is). No, my question is not that much technical, as it is about morals and integrity.
O.K. the mechanic immediately put dye in the engine and said that the rear main seal is leaking and gave me $700 estimate. I approved the job. Later on he called me back, saying that after he began disassembling the engine, he kept looking and found more proof that the front, not rear seal was leaking. That was good news, because now the repair price became less, $500. I said: whatever it takes.
At the end of the day he said that he was done, the car has been idling for 20 minutes and no leaks. I took the car from the parking lot, but since it was too late and he already left, I did not pay that day.
When I came home, I decided to stick a piece of cardboard under it, just to be sure. Next morning: an oil spot about 4”. At work I also put cardboard and at the end of the day got the same oil spot. Bummer!
That evening I stopped by the garage to pay for the “repair”. When I told him about leak, he said: too bad, it was probably the rear seal, as he originally suspected. Then he went to the computer and pulled out a new estimate for the rear seal replacement: now it was $1100, not $700. Why? Because he overlooked something the first time: my power train has a cradle, joining an engine with a transmission and it is impossible to drop the engine down: it should come out from the top, which is much harder. So, he suggested me still paying $500 for the front seal (which did not solve the problem), plus $1100 to a total of $1600. But since he mis-diagnosed, he would cut me a break and charge “only” $1300 for the whole thing.
Honestly, my jaw almost hit the ground, but I did not say a word. I asked him for a few days to think about it; he agreed without asking for money. Obviously, he expects me to either pay $500 and live with the leak or keep fixing and pay the whole $1300. BTW, the leak has been going on for three days now.
Here is my dilemma: is it morally right to keep charging for a mis-diagnosed repair? Wouldn’t it be ethical and a good customer retention practice to make it right and only charge what you quoted, no matter what? And if you mis-quoted, is it O.K. to say: sorry, I did not think straight and jack the price way up?
I am not sure what I would expect him to do. Maybe, stick to the lowest price of $500. Maybe even ask for $700, since that was the original quote; I would gladly pay that too. But asking for almost double that?
Dealing with a friend makes the matter much harder. I cannot put a price to a friendship, but expect reciprocal attitude. Why should I be a “Mr. nice guy” and let others take advantage of me?
Please, share any insights.
Thank you.


ANSWER: Alex,
 I hear this all the time, somebody replaces a rear seal or oil pan gasket on a Camry and it still leaks oil.

 We replace a lot of timing belts on Camrys, The engine leaks are normally the oil pump seal and/or the crank seal at the front of the engine. When we change a timing belt we'll usually change
those seals because if there not leaking they will be.
The rubber gets hard from heat and age.

The other 3 common places that we correct oil leaks are the valve covers (the hold down nuts loosen over time), oil sending unit, and the distributor. All of these run down the block and are mistaken for oil pan leaks, rear seal leaks, etc. The engine is constantly twisting and moving so the oil leaks from one area and can actually travel to the other end of the motor where it looks like its leaking from.
I'm not saying the rear seal never leaks on a Camry but I've never seen one.

Good luck.

---------- FOLLOW-UP ----------

QUESTION: Thank you for an excellent reply.
Though your technical expertise is invaluable, I'd also like to get your opinion on the other, moral side of the story. What would you do, had it happened to you as a mechanic? What should I expect my mechanic to do? I am facing a total of $1300 charge now, while originally quoted $700, right or wrong. You see, my dilemma is this: he mis-quoted the real seal for $700, while now he said it should've been $1100. My problem is: if it were, I would definitely not decide to get it fixed, but instead traded in. I beleive, mechanics should realize that their quotes affect big decisions and not take them lightly.
Please, comment.

Answer
Alex,

 I was trying to say between the lines that he made a mistake once, which happens a lot with shops and they get away with it. Because they made a mistake, they want you to pay again. Who's to say it will be correct this time? If I quoted someone wrong and did the job, I
would stick with the original quote charge, but that's only me. If
you have an oil leak and sell it or trade it in its only fair that
you let the buyer know ahead of time, which will lower the value of the vehicle.
  Its much easier to sell a vehicle with out an issue like that,
if you fix it hopefully you can add more to the selling price to off-set the repair cost.

Hope I answered your question,
let me know the outcome,
I'm curious.

Good Luck,
Tim,
ToyDoc