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How many miles are on this Corolla?
40 or so K
Did you see where the cable was broken?
No, as explained, the tow driver diagnosed the problem and move the shift to drive and advised that vehicle be driven to Toyota saving 35.00 dollar tow charge and charged 30 dollars for his advice and assistance.
Yes, it can be a defect but right now there isn't a Recall on this condition. The cost to repair it will run approx $150 but please talk to the Dealer first and see if they will goodwill this repair. This is where Toyota will repair it at no cost.
Please reply back if needed.