Do buyer have the right of reimbursement in the improvements he/she made?
Case:
Our company sold an unused vehicle to the highest bidder. The buyer incurred cost to restore the vehicle into good running condition. Unfortunately, during the registration to LTO, they (the buyer) found out that the engine is reported a lost engine. We search for the history of the vehicle since we are not aware of this and found out that the engine is indeed replaced somewhere in Baguio where it broke during its service in unknown year. Since there is a problem in the registration, we agree with the buyer to cancel the Deed and return the amount paid to us. The question is:
1. Do they also have the right to reimburse for their repair expenses?
2. Is word Void ab Initio applies only to the contract and not our responsibility to pay for the repair costs?
Thank you.