The garage is responsible as Slacky says.
However, you may run into a spot of bother as you accepted £10 for the damage.
He has admitted that he caused the damage as he gave you the money, but he may then argue that 'you entered into a binding contract' by accepting the money. He offered compensation for the damage and you accepted.
He may also have a notice up stating that he is not responsible for damaged caused to your property. It doesn't absolve him, but when you left the vehicle with him you indirectly accepted his terms and conditions.
Tough one.
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