One of the rules of retail is that you have to put as much effort into protecting yourself from your customers as you do making them happy. The shop owner likely will never know for sure what happened here, unless a tech ‘fesses up. But he has interests to protect.
So, if you go the Small Claims route, you need to anticipate what the shop owner will tell the judge:
Customer brings a beat-up old clunker in for some trivial bogus repair — greasing a seatpost?, wtf? The tech notices the dented seat tube and, to avoid being tricked into being blamed for pre-existing damage, pulls the post by leaving the bike standing on its tires, sitting over the rear wheel, and pulling straight up. No ZZZ-marks on the post. Smear a little grease on and stick ‘er back in. Bob’s your uncle, no clamp used at any point and that’s God’s honest truth. So buzz off, customer. Go cheat someone else. (Oh, and by the way, I’ve reinforced with my techs that they must document damage on arrival. Yes we know it’s hard to know what counts as damage on 40-year-old clunkers, but win or lose, this case is a learning experience: the more we can document, the better off we are in disputes.)
As I’ve said above, don’t argue this point here. Save it for the judge.