The error went undetected for almost a year by the bank and lawyers. But Richard Larkin must now repay the difference, €49,950, plus interest, to the bank, a judge has ruled.
After Patrick M Keane & Co Solicitors in Galway notified AIB in late January 2010 about the mistake relating to the March 2009 cheque, it paid the outstanding €49,950 to the solicitors and then sought that money from Mr Larkin, of Barna Lodge, Toureen, Co Galway.
The bank alleged Mr Larkin must have been aware the full amount of the cheque had not been debited from his account. When he denied liability, AIB pursued him for payment in the High Court.
Mr Justice John Hedigan ruled Mr Larkin had raised no plausible defence.
Mr Larkin was in this position probably as a result of a mistake by others but this was not just a court of law, it was also a court of justice, the judge said. Justice could not be served except by ensuring Mr Larkin met his obligations when he had asked his bank to pay his solicitors their fees.
The judge did not accept Mr Larkin had not become aware of the mistake quickly and said he had "no hesitation" finding Mr Larkin liable for the €49,950, plus interest from February 2010 when AIB notified him of the mistake and demanded payment. AIB had sought some €6,800 interest up to November 2011, when the case issued.
The judge also rejected arguments Mr Larkin had no liability on grounds the cheque became "stale" after a six-month period.
The case arose after Mr Larkin wrote a cheque for €50,000, dated March 9, 2009, drawn on his account with AIB, Oranmore, Galway, and payable to "Keane Solrs". He gave the cheque for payment to Patrick M Keane & Co and it was presented for payment at the AIB branch at Eyre Square, Galway.
AIB said, due to an error by the payee filling out the lodgment docket, which was not noticed by the bank teller, the cheque was processed as one for €50.