John, that does not sound correct.  In the past I have had similar problems and it turned out to be dried up sealing rings on the 2nd gear brake band piston which can be accessed from the side of the tray without removing the tray from the vehicle.  This is the FIRST place I would go looking.   There could also be a problem with the accumulator piston which is accessed by removing the pan and then the valve body from below.  There also may be one or more sticking or dirty valves in the valve body.  All of this work can be done with the tranny in the van and in now way would be anywhere near $1800 !

Seal ring, 2nd gear brake band piston, 010 323 487C
Seal ring, 2nd gear brake band piston, 003 323 525A

Piston, accumulator, auto tranny, 003 325 405F

On 2011-07-08, at 12:00 AM, Automatic digest processor wrote:

> Last year, my local VW mechanic had my automatic transmission rebuilt.  A year
> later, when the transmission won't upshift when the fluid is cold, he tells me
> that I likely have a "faulty seal on a band actuator"  and he wants $1800 to fix
> it.   When transmission is warm, transmission operates okay.
> 
> Does above make sense?

Cheers,    

Frank Condelli
Almonte, Ontario, Canada
'87 Westy & Lionel Trains (Collection for sale)
Frank Condelli & Associates - Vanagon/Vanagon Westfalia Service in the Ottawa Valley
Vanagon Stainless Steel Exhaust Systems
BusFusion a VW Camper camping event, Almonte, ON, June 09 ~ 12, 2011