The mistake was using material that wasn't yours to begin with.
This all must be prefaced with the known
reasonableness of your customer and
established expectations for the project. I admonish you to make a million percent sure beforehand that your customer is crystal clear about your shops' capacities versus what they are requesting of you.
I would expound on this to say that I would not want to install or work with/ print to a material that I cannot easily replace myself. If my customer walks in the door with a 2x4' piece of 3/16 acrylic that they simply want to add some SAV to- great, easy peasy. Even on these jobs I add an addendum to the project agreement clearly stating that we are not responsible for any incidental damages that may be incurred in the process of applying graphics to customer supplied materials, and make sure they agree. In the rare instance that I have to, I have them replace the material at cost plus 15%. Most
reasonable customers understand this perfectly and will take zero issue with it.
However for instance, I get people walking in the door that want to send fragile, frayed original art pieces through my rolling scanner. I do not have a large enough flatbed scanner to handle this sort of request. I tell them reach out to a photographer who can work with them in getting a digital image sized and corrected to their liking, or to travel to the Bay Area to find someone with this type of scanner (lol) and then reach back out to me for their intended output. I also get customers wanting to have laser engraving done on priceless glass or wood items for customization, and I politely decline due to the not impossible chance that it may be destroyed or damaged in the process.
The overarching lesson is this; Manage expectations or get ****ing sued. I highly doubt this person has a case, but it is still a major PITA. Leave no ambiguity about what may occur. CYA.