Certainly under Australian Law if you receive money that is not yours you are legally obliged to do your best to return it to its rightful owner.

There was a case in recent years here in AU where a person had large amounts of money put into their account in error by a bank.

They proceeded to spend the money as tho it were theirs. But of course the error was eventuallly uncovered and they were caught and faced a lengthy gaol term for it. Simply it's regarded as theft.

So if the recipient is within AU and you notify them of your error they would then be legally obliged to return it to you.

I suspect if you explained that to PayPal along with your error they might be sympathetic in recovery of the funds.

I would call them.