I will get a full refund wont i? I mean even if he doesnt have balance in his account wont paypal cover for it?
You will get a full refund but eventually and you may have to fight for it. I had one seller (an o-review member at the time) try to rip me off for a couple of hundred dollars. I PMed him to say that if the watch hadn't turned up by a certain date, I'd have to open a paypal dispute and make a claim. He promptly emptied his paypal account and removed the link to his bank account, so when paypal found in my favour, there was no money to recover. When paypal told me they would give nothing back, I went to my credit card company and they eventually gave me a refund. I don't know if they got the money back from paypal.
Another time I bought an iphone. The seller sold 68 iphones in 72 hours after I'd bought mine and was then deregistered by ebay. He tried the same scam of providing USPS shipping notification instead of proof of postage. After a few weeks paypal refunded all my money.
The thing to remember with ebay and paypal is to always use a credit card to pay. If you do that, in an absolute worst case scenario you can just refuse to pay the credit card bill and tell the credit card company you'll either pay them when they present to you legally correct authorisation for the transaction or see them in court. Seeing as payment orders legally require a signature and there is no signature on internet transactions, the credit card company will always back down.