1000 for IW horse trailer in any condition is cheap IMHO.
Good faith doesn't come into it. Provided that you didn't misrepresent the trailer to her, she isn't covered by Sale of Goods Act unless you area dealer.
I would tell her that you have no intention of refunding as she inspected it and told her all faults of which you are.
If she feels differently, let her take you to court and then you let a judge decide. I wouldn't be paying her anything.
Incidentally if ever selling anything like this (including cars) I give them a 1hr unconditional warranty. (I play with lots of motorbikes)
If they find anything wrong in an hour, bring it back and they can have their money back.
I have never had a return.
If you don't want the grief, give her her money back less say £100 for the use she has had. She might have done what she wanted and now wants rid or found another better, cheaper one etc.
She may simply not like towing or her car might not be big enough
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