Is this EE3 or EE4? We may need to add the refund status into the gateway. Looks like right now it just has completed and pending. Any other message it receives from Paypal gets interpreted as “Declined”.
I’m not sure if that is an ideal approach as it could affect other customers when their payment is declined, but if it works for you in the short term then it is a viable workaround.
I agree with Sidney that it looks like we need to add a refunded status to the gateway to trigger the correct email message.
I will raise a ticket for a developer to look into it.
A little update on this: There is a fix for the issue that you reported here, and it’s included in the latest release of Event Espresso 4.6. With this update, EE4 will no longer send Payment Declined messages when a refund is processed at PayPal.com.
The changelog for version 4.6.21.p can be found here: https://eventespresso.com/wiki/ee4-changelog/#4.6.21
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