My First Benz a 1989 300E

[BenjiBreal]

I recently purchased a 1989 300E with 101K miles. About a week ago i started hearing a little clicking sound coming from the car. I thought the sound was coming from the front of the car but then realized it was coming from the back. I went out yesterday and noticed the back left rim had a brownish rust like stain around the openings. The sound kind of matches the the speed when driving (the faster i go the faster the clicking). Also, when backing up there's a slight knock sound that only happens once and sometimes when making a left turn.

I took the car to the shop today. The mechanic said it looks and sounds like the emergency brake. also, he mentioned i shouldnt drive it until its fixed. Wants to charge $157 to put it on the lift and look at it?

What do you guys think?