A €50,000 cheque written by a man to pay legal fees was mistakenly processed by Allied Irish Banks as being for €50, the High Court heard.
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 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, Kilcolgan, 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, in circumstances including that Mr Larkin had the benefit of the outstanding monies, he 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 claimed, due to an error by the payee filling out the lodgement docket, which was not noticed by the bank teller, the cheque was processed as one for €50. The Eyre Square branch passed the cheque onto the Oranmore branch, as paying bank, on the basis it was a €50 cheque, resulting in Mr Larkin's account being debited for just €50.
On January 20th 2010, Keane Solicitors advised the bank of the mistake and AIB paid the firm the €49,950 outstanding. AIB then sought payment from Mr Larkin. When none was received, the proceedings issued.
Opposing the bank's application, Mr Larkin said, when he drew the cheque in March 2009, it authorised AIB to pay out €50,000 in one payment within six months provided there were sufficient funds in his account to cover payment.
When the cheque was presented for payment in March 2009, the bank negligently wrongly debited his account by €50, he claimed. He alleged bank staff at AIB Eyre Square and Oranmore negligently and in breach of duty and contract failed to notice the cheque was for €50,000 and the discrepancy was also not noticed by any other collection or clearing mechanism operated by AIB.
Mr Larkin said he had had sufficient funds in his account in March 2009 to pay the €50,000 and, were it not for the alleged negligence of AIB, that sum would have been paid then, clearing his liability to the law firm.
In February 2010, almost a year later, AIB chose to credit the lawyers with €49,950 when that payment, he alleged, did not accord with the mandate he gave the bank when he drew the cheque.
Among various arguments, he contended the Bills of Exchange Act 1882 provides, where a bill is not "duly" presented for payment, the drawer and endorser may be discharged and he should be discharged from liability. He also argued he was not liable to AIB for the €49,950 because, when AIB paid Keane's in March 2010, it knew he had insufficient funds in his account then to meet that payment.