Problem with cancelling an order

A buyer has asked to cancel a purchase and I've started the cancellation process but received the following message: 

"There was a problem processing your refund for this cancellation. Please visit the cancellation details page for information on resolving this issue".

I'm a bit confused as the cancellation details page just says to refund the buyer by Jan 8th. Doesn't this happen automatically through ebay once the cancellation is requested or do I have to go to paypal and actually authorise it myself? I don't want to end up with the refund being issued twice!

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The buyer didn’t pay for the item