I doubt they can be held liable... However, I would like to add, not only did they recommend that he convert the car to RWD, they took credit for it on their FB page...
http://i30.photobucket.com/albums/c318/Juicedh22/CTD_zps952a72be.jpg
Now, had they actually been the ones who performed the modification, the owner 'might' have a better case of holding them liable for the work performed, if it could be proved to be faulty and/or a safety hazard, etc...
Either way, if the owner speaks his mind on the matter, its yet another knock against the shop...