I’ve worked as a bartender. If a customer walks in already drunk, and you refuse to serve him because he is visibly drunk, you’re not going to get sued if he then drives away and kills someone without you having served him any alcohol. It’s only if you serve that customer a drink that you incur any liability.
Which school did you attend? I ask because this is usually a matter for management to contend with, not a mechanic.
Sears automotive service isn’t exactly known for being reputable. They could have just written on the bill for diagnostic work, “advised customer not to drive car due to unsafe condition - recommended tow truck instead,” have the customer sign it, and rid themselves of liability.
I still appreciate that it’s unsafe to drive on a bad bearing. Anytime someone asks, “How far can I drive on a bad bearing?” the answer is, “all the way to the scene of the accident.”