So I set a meeting with a guy to sell him my phone. On the way to the meeting (which was convieniently at his house) I found out there was a minor defect to the phone. I told him that a function of the phone was not working most likely due to water damage (this is what a quick google search discovered: that this function usually doesn't work if it has water damage). I told him that I won't be selling it to him because that function doesn't work. HE insisted that he'll still take it if I give it to him for a discount. I cut off a portion of what I wanted for the phone and at the moment I sold it to him I told him that I wanted him to make sure that he checks the phone out completely before buying because I didn't wanna make that 2 hour drive again for a refund. He checked it out and still bought it.

2-3 months later he's asking for a refund because apparently there is a different problem with the phone too. He's saying I didn't disclose that there was this problem and not what he expected.

Do I give him the refund..??

Nope. Why should you. If he told you that there was a problem with the phone within a month then it would be understandable.

No binding contract in either written word or spoken? You aren't liable. If you told him you would consider a refund down the road if anything else was wrong, you would be legally liable to that wording. Without writing even.

2-3 months? I would LAUGH at my best friends if they tried to bring me something back after that long. A random dude potentially on Craigslist or whatever? Laugh harder.