Automobile Enthusiasts

Three parties are involved:
The shop- has possession of the vehicle, invest in and was paid for labor of repair.
The owner- left the vehicle to be repaired and can't afford the repairs.
The buyer- paid $2800 ($700 plus $2100 for repairs) for the vehicle and can't take possession.

The deal between the shop and buyer can be construed as void since the shop is not able to provide a clear transferable title.
The deal between the shop and the owner is really unclear since ownership was offered and accepted in lieu of payment for repairs.

At this point the buyer is due either a refund of his money or the vehicle. The shop is responsible for making that happen. The buyer has no real way to compel the owner to anything. The is responsible for creating the problem since they failed to responsibly maintain the title. The shop can't come after the owner for repairs which weren't authorized and that have been paid for by another. However, the shop can notify the owner, since said owner is still the legal owner, that beginning today, the owner will be responsible for storage of the vehicle until it is removed. The shop should be responsible for the owner's time and expense to obtain a good title because of their failure to maintain the original.

The owner's continued refusal to either provide a new title to complete the sale or pay the storage and repairs should grounds for a court case. At that point the court can issue a judgement favoring the shop to take ownership.

The shop could also pay for an attorney to either represent the owner in replacing the title or provide a limited POA for the owner to allow the shop to deal with the title issue.

Depending on the location (state) any of this my be invalid.

Lesson learned: IMO do not pay for repairs on a vehicle you don't own.