I contacted their helpline as the buyer escalated the case. The funds were then frozen in my Paypal account, so I contacted the eBay helpdesk. They said that I needed to refund the buyer, and if I didn't, they would. When I asked what I would do with regard to the money I lost out on, as I had RM proof of delivery, I was told to raise a claim with Royal Mail. The same happened when a buyer claimed the packaging arrived ripped open, with all the items taken out (unlikely).
I know that as a business seller (not on eBay, separate website), I can't legally refuse a refund unless the customer has form for putting claims in. I've had many cases where the parcel has been signed for, and the courier has given detailed info on delivery... still had to refund and raise a claim with the courier though.
"The Distance Selling Regulations say that goods must be delivered within the time frame you agree with the seller.
If no time frame is agreed, the seller has 30 days from the day after they receive your order to deliver your goods."
^ It's that, or a refund. I guess the buyer could be made to wait the 30 days, but they ain't going to be at all happy about it.