I sincerely hope you're closing out that account and opening a new one, because you have no idea how many of these old checks are out there.
Your customer did the right thing and called these items to your attention promptly. Obviously, your bank has correctly reimbursed the customer because the items were not properly payable the second time around.
Although the UCC has been amended to the point that you aren't responsible to your customer for paying a "stale" item, I don't think that absolves your bank if its responsibility for paying an item twice. I see nothing in the code that addresses how you could justify charging the items back to the depositary bank.
However, the realities of today's check processing environment put the depositary bank in a better position to have been able to catch these items in their ATM deposits than you were to catch them in your routine check processing unless you maintained paid check data for over three years.
The depositary bank could argue that it could not tell whether the items had been paid from the endorsements and other markings on those checks (unless your bank adheres to the old routine of marking items "PAID."
I think this is can politely be called a "standoff." The odds are you'd throw away more in legal fees than the checks are worth to try collecting from the depositary bank.
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John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8