Legal Definition and Related Resources of Set-off

The discharge or reduction of one demand by an opposite one or the right one party has against another to use his claim in full or partial satisfaction of what he owes to the other . See Studley v Boylston Nat. Bank, 229 U.S. 523, 33 S. Ct. 806, 57 L. Ed. 1313. It is an independent demand of the defendant made to counterbalance that of the plaintiff , in whole or in part. See American Smelting and Refining Co. v Swis- shelm Gold & Silver Co., 63 Ariz. 204, 160 P.2d 757. It is essentially an equitable doctrine based on the principle that natural justice and equity require that the demands of parties mutually indebted be set off against each other and, only the balance recovered. See Yardlev v Clothier, (C.A.3) 51 F. 506.

In practice. A demand, growing out of a distinct transaction, which a defendant makes against the plaintiff in the suit for the purpose of liquidating the whole or a part of his claim. See 7 Fla. 329. A set-off was unknown to the common law, according to which mutual debts were distinct, and inextinguishable except by actual payment or release. 1 Rawle (Pa.) 293; Babington, Set-Oflf, 1. St. 2 Geo. II. c. 22, which has been generally adopted in the United States, with some modifications, in cases of mutual debts, however, allowed the defendant to set his debt against the other, either by pleading it in bar, or giving it in evidence, when proper notice had been given of such intention, under the general issue. The statute, being made for the benefit of the defendant, is not compulsory (8 Watts [Pa.] 39) ; the defendant may waive his right, and bring a cross action against the plaintiff (2 Campb. 594; 5 Taunt. 148; 9 Watts [Pa.] 179). It seems, however, that in some cases of intestate estates and of insolvent estates, perhaps owing to the peculiar wording of the law, the statute has been held to operate on the rights of the parties before action brought or an act done by either of them. 2 Rawle (Pa.) 293; 3 Bin. (Pa.) 135; Bac. Abr. “Bankrupt” (K). See 7 Gray (Mass.) 191, 425. Set-off takes place only in actions on contracts for the payment of money, as, assumpsit, debt, and covenant. A set-off is not allowed in actions arising ex delicto; as upon the case, trespass, replevin, or detinue. Buller, N. P. 181; 4 E. D. Smith (N. Y.) 162. The matters which may be set off may be mutual liquidated debts or damages; but unliquidated damages cannot be set off. 3 Bosw. (N. Y.) 560; 34 Pa. St. 239; 34 Ala. (N. S.) 659; 20 Tex. 31; 2 Head (Tenn.) 467; 2 Mete, (Ky.) 143; 3 Iowa 163; 8 Iowa 325; 1 Blackf. (Ind.) 394; 8 Conn. 325; 6 Halst. (N. J.) 397; 5 Wash. C. C. (U. S.) 232. The statutes refer only to mutual unconnected debts; for at common law, when the nature of the employment, transaction, or dealings necessarily constitutes an account consisting of receipts and payments, debts and credits, the balance only IS considered to be the debt, and therefore in an action it is not necessary in such cases either to plead or give notice of setoff. 4 Burrows, 2221. Distinguished from counterclaim and recoupment. Counterclaim is a term of statutory origin, and includes both set-off and recoupment, and something more. It embraces all sorts of claims which a defendant may have against a plaintiff in the nature of a cross action or demand, or for which a cross or separate action would lie. 13 How. Pr. (N. Y.) 84. In recoupment, the defendant’s claim must arise from the same transaction as the plaintiff’s, and in this it is distinguished from set-off, which must arise in a distinct claim. See “Recoupment.”

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Set-off in Historical Law

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This definition of Set-off is based on the The Cyclopedic Law Dictionary . This entry needs to be proofread.

Vocabularies (Semantic Web Information)

English Spanish Translation of
Set-off

Compensación de deuda

Find other English to Spanish translations from the Pocket Spanish English Legal Dictionary (print and online), the English to Spanish to English dictionaries (like Set-off) and the Word reference legal translator.

Concept of Set-off in the context of Real Property

Alternatives definitions of Set-off: (1) A construction term relating to the reduction of the thickness of a wall, or any recess or sunken panel of the wall. (2) A legal term meaning a counter demand to a claim. In condemnation, the benefits to the remaining property in a partial taking may in some jurisdictions be “set-off” against the value of the land taken. Example: part of land taken for a freeway; residue now more valuable because of freeway. Increased value is “set-off” against value of land taken.

Concept of Set-off in the context of Real Property

Alternatives definitions of Set-off: (1) A construction term relating to the reduction of the thickness of a wall, or any recess or sunken panel of the wall. (2) A legal term meaning a counter demand to a claim. In condemnation, the benefits to the remaining property in a partial taking may in some jurisdictions be “set-off” against the value of the land taken. Example: part of land taken for a freeway; residue now more valuable because of freeway. Increased value is “set-off” against value of land taken.

Set-off