I need some expert opinions here really badly;

Friday:

Picked up my 1994 850 with 236,000 miles on it from reputable indie Volvo shop (one I have used over the past 2 years and been very happy with). The bill was $840 for a new water pump (had been leaking), timing belt, cam seal (leaking oil onto timing belt) alternator belt and front motor mount. I'd been saving a while for this major fix up.

Friday night - Saturday morning:

Wow car drives like a dream! It may have high miles but it drives like a brand new car and I am happy.

Saturday afternoon:

We take a 90 miles road trip in car. On the highway at about 60 miles, black smoke starts to blow from exhaust. Car makes horrible "chugga chugga" noise at lower rpm's as we slow down. At stop signs car is obviously running on 4 cylinders. We end up driving the car back home being a weekend and no garages to be found.

I figure perhaps the timing belt has stretched and needs adjusting or something related to the repairs done the day before ... whatever I figured it was no big deal and maybe abother $50 to fix.

Monday morning:

I took car back into repair shop that did the work and explain. They take a look and do compression test - no compression in 1st cylinder. ("Under 5" I don't know 5 what) and shows me the spark plug coated in oil. Mechanics say my engine is screwed - the 1st cylinder (but only that one) appears to have either broken values or blown rings. It would be several hundreed $ to take the head off and diagnose. They say this is bad luck that it happened the next day after their timing belt work. I say put car back together I have to get to work and my credit card was maxed from work done 2 days ago.

Now, according to my limited mechanical knowledge, the timing belt controls when the plugs fire and when the valvues go up and down - thus the danger of the belt breaking is that these parts could hit eachother and cause exactly the kind of damage I see in my car.

Being a non-expert and trusting this garage I did not want to make any unseemly implications, but isn't it possibly - or even LIKELY - that IF they screwed up the timing belt it broke my engine?

Or do I just have the worst luck in the world?

If it is possible/likely my next step is to take the car to dealer or another mechanic for assessment, and then if it is the garage's fault I suppose they owe me a new engine?