A bad situation

I'm looking for opinions as to how to resolve a situation that arose recently. I sold a preamp to a gentleman here on Audiogon for $150. From what I can tell he wanted to use the preamp as an inexpensive phono section. He sent me a money order and I in turn sent off the preamp via UPS insured, packaged up with plenty of bubble wrap so (in theory) it wouldn't get damaged. The preamp arrives, but, the selector switch is broken and evidently the switch is an oddball component that cannot be sourced. I know the preamp was working fine before I shipped it, I sure wouldn't sell a piece of broken equipment, not even for a $150. What's the equitable thing to do in this situation? Make a claim with UPS? Pay a tech to hardwire the premap, bypassing the selector switch? Refund his money and throw the thing away? I know, it's only $150 but at the same time there really ought to be a code of ethics we all try to follow. I understand the buyers disappointment and he may even feel like he's been screwed, I want to make this right. Any and all opinions are welcome. Thanks, Jeff