had a reply....
I have absoloutely no idea why it says this, as we have had this phone for a year on t-mobile, and our contract has ended. it was given to us by my brothers business partner, who we know personally, and we are unsure as to why he has reported it lost or stolen. I dont know why it isnt working with you as it has the whole time with us, and we do have proof as purchase. If you like you can have his contact details. I have rang my brother to try to resolve the issue and he says that he wont be returning the money until the iphone is returned, as he doesnt wish to lose the money and the phone, please dont take this out on me because the phone isnt mine, im just the messenger.
I sincerley apologise for any inconvience caused to you by this.
here is a quote from apples serial and warranty checker
iPhone 4 Serial Number: 7T037***A4S Your Apple's Limited Warranty Estimated Expiration Date: 12 November 2011
how can they be out of contract on an iphone 4 thats has 1 months warranty left. T-mobile only do 18 month 24 month contracts and its a locked t-mobile as well
shall i just ignore all response now and let paypal sort it ?