breach of contract

What is the name of your state? ****land

I have a bit of a delema...in November 2005 I was selling my car a 96 Pontiac with 131000 miles on it. I had someone who wanted to buy it but wanted to do payments. I agreed to 3 monthly payment, the balance is due 1-15-06. They made their last 2 payments on time, but were complaining about the heat in the car not working. I told them it worked fine for us the year before but didn't use it since then. Then we having a problem with the title, the bank has it until the lein is paid so we were working on a solution for them to get the title right away when they pay the car off. Now I get an email from then yesterday, they told me that a mechanic told them the transmission is in "bad condition and could go anytime". We had no problems with the transmission. Now they gave us 2 options, get the car fixed or take the car back. I wrote back and told them they have 2 options, pay us our money or we'll see them in court and report the car as stolen. Everything is still in our name, insurance, registration, title, everything because they have not paid the car off. The problem I have is we didn't state anywhere in writitng that the car was as-is only verbaly. All we have is a signed noterized contract for the payments.
My question is do we have a winable case in small claims court?

I don't even know where to start on this one. I realize you're here for help, but you've put yourself in a very bad position and I need to point several things out.
1. You could be held financially liable if this person gets in an accident and damages property or hurts or even kills someone.
2. You are most likely violating the terms of your loan and the car could be repossessed if the bank learns what you're doing.
3. You didn't get anything in writing about the condition of the car. This means it's your word against the other party and you as the current owner could very easily end up with the car back in your possession with problems they caused.

You have a 50/50 chance of winning this in court. It really depends on how well you present yourself and your case and how the judge is feeling that day.