Toyota Repair: Reimbursement, rear axle seal, garage owner

Question
This is not a typical question about repair.  I have a 97 4runner and the right rear axle seal has been leaking for awhile.  ive had it fixed multiple times but not at the dealer and i would discover that it was leaking again only after the work guarantee was through.  i took it to a mechanic and had him replace the axle and everything thinking that there was a small defect, and that didnt work luckily i found out that it was leaking soon after and took it back.  he talked to multiple people including dealers and could not fix the problem.  i finally took the car to a dealer and had it fixed, and of course they charged a rediculous amount of labor for the job.  my mechanic is willing to give me an appropriate refund, but im not sure what to ask for back.  he put alot of time and money in to attempting to fix the problem and said he would refund whatever i deem a fair amount.  his labor for more work was only $200 while the dealer was $550 for less work.  the parts were the same.  what amount should i ask for back ( he is a struggling garage owner)?

Answer
i would split the differance.. he made a good attempt at correcting the problem as many times as he did.
i would have him pay half of the dealer repair bill and chalk the rest up as a bad decision to take it to a indepenant shop.. not that they are bad or anything but there is a reason why the dealers where able to fix it remember that.