Hi Sunsett, Thanks for your reply. We have fixed the problem, it ended up being the cables. The outer plastic coating has come off the gear selector cables behind the engine where it was hard to see. It seems this allows water to penetrate the outer cable wires, which seems to cause them to break down, then once rusty, the strands seem to come apart, then the inner cable binds and kinks. That it why it was able to select the forward facing gears as pushing the gearstick forward, actually pulls the cable, the rearward shift tries to push the cable and as the strands of the outer cable has come apart, it just kinks up the inner. The cables cost $936 from Toyota. We took the old cables to a cable remanufacturer and he informed us he was unable to repair Rav4 cables as the cable ends, once removed from the original cable are not reusable. Condition of secondhand cables were not a lot better than the ones we had as the outer plastic coating had began falling off. So, all in all a very expensive thing to fix, but still cheaper than the fault in the gearbox Toyota had diagnosed. So anyone else with the same hard to select gears problem, I strongly recommend if using second hand cables, make sure the black outer plastic coating is in good condition or else they will not last long in the car and you will be looking for more. The wreckers tell me they sell a lot of them, so they'll probably end up very hard to find.