Car dealer increasing price on car once deposit placed?

[fergus]

I recently agreed to buy a classic car for a specified price and paid a 10% deposit. The trader confirmed via email "Just to confirm we have agreed a purchase price of X and I have taken a card deposit of Y to secure it for you. I have agreed to have the car fully checked over, serviced, MOT'd and any defects rectified, these include but are not limited to XYZ..."

Whilst having the (known) defects rectified, the garage doing the work noticed that the car had a slight oil leak and required a new head gasket. This has led to further, unexpected, expense for the dealer, who has subsequently requested an upwards revision in the price, stating they have had interest in the car at above the advertised price, and the garage doing the work stating they believe the car is worth more than the sale price.

What's the legal situation here?

[fergus]

Thanks for the replies guys. It's a fairly rare car in exceptional unrestored condition, so finding another would be very difficult.