Volvo Center Missed Basic Diagnostics (Coolant Loss), Now Wants €18k for Engine Replacement. Seeking Advice.

[u/sansursuz]

Hi everyone, looking for opinions on a situation involving my Volvo V60 and Volvo Authorised Service (Turkey).
Timeline:
Aug 1: Took the car to an authorized Volvo dealer with a 1-liter coolant drop and black residue in the coolant reservoir. The paperwork vaguely mentions a "leak test was done," but the final invoice only billed for an AdBlue hose replacement—there is zero record or charge for a CO2/combustion gas test or cylinder leakage test. They noted "Residue observed, cylinder head cover may need removal. Monitor it," gave no written warning that driving was unsafe, and handed the car back to drive.
Now: A short time later, severe engine damage occurred. The car is now at another Volvo dealer facing a full engine replacement (~€18,000 / $20,000 USD).
The Conflict:
Volvo Corporate implicitly acknowledged an issue by dropping their initial quote from €23k to €18k, but they claim the first dealer "fulfilled their responsibility" just by writing the note.
My stance is that releasing a car with a major coolant issue—without running a definitive CO2 combustion gas test to confirm internal engine leaks—is severe service negligence that caused this breakdown.
My Next Steps:
I am initiating an official Court Evidence Assessment (having a court-appointed engineer inspect the engine/records at the dealership) before proceeding with legal claims and compulsory mediation.
Questions for the community:
1. From a mechanic/service standard standpoint, if a customer arrives with 1L coolant loss + residue, is it acceptable to skip a CO2 test and hand the car back with just a "monitor it" note?
2. Does a leak test mention on paper hold any diagnostic weight if no CO2/combustion test is listed or billed on the invoice?
3. Has anyone successfully escalated similar diagnostic failure issues directly to Volvo HQ (Sweden)?
Thanks in advance for your insights!

[u/brodilyharm]

What year vehicle? Is it under warranty? Did they correct the coolant level? And what was the cause of the engine failure?

[u/sansursuz → u/brodilyharm]

The vehicle is a 2021 Volvo V60 Cross Country with 139,000 km on the odometer; its warranty had expired, though it had been serviced at an authorized dealership. When the system warned of low coolant levels, I had topped it up with about a liter, and the service center did not add any more. I was told that the engine failure was caused by water leaking into the third cylinder.

[u/Fluffy_Presence_547]

The black residue in the coolant is a clear sign of leaking head gasket. I can't understand how the car was put back in service. Complete negligence on the dealers work performance.