This is an important document which you must consider carefully when choosing whether to use the Services at any time. This Agreement also highlights certain risks on using the Services.
Please note the following risks of using the PayPal service:
Payments received in your PayPal account may be reversed at a later time for example, if such a payment is subject to a Chargeback, Reversal, Claim or otherwise invalidated. This means that for some of our sellers, payments received into their Account may be returned to the sender or otherwise removed from their Account after they have been paid and/or delivered any goods or services sold.
You can help protect yourself from the risk of a payment being reversed from your Account by following the criteria set out in the Protection for Sellers section and by following the other guidance provided in the "Security Center" accessible via every page of the PayPal website.
We may close, suspend, or limit your access to your Account or our Services, and/or limit access to your funds for up to 180 Days if you violate this Agreement, the PayPal Acceptable Use Policy, or any other agreement you enter into with PayPal.
If you wish to open a Dispute through PayPal’s Online Resolution Center you must do so within 45 days of making your payment.
You must consider such risks and guidance when using PayPal.
Got this from paypal site. Definitely states that funds can be reversed and returned to sender. Unless he took the money out immediately, I guess.