When a dealer takes a trade, especially a high dollar 55 hp compact 4x4, they check every mode of operation. When it doesn't function correctly they either don't buy, bought it from a salvage operation for very little cash, no warranty or subtract the repair estimate from the wholesale price. In this case expensive parts and many hours of labor. Besides it may be more than the clutch itself.
Something is not right or there is more to the story. The seller definately knew of the problem. I can't believe the buyer didn't stick the loader in a pile and test the hydraulics before purchase.