1. A homeowner hires a contractor to fix up a house. While working on the house, the contractor mistakenly breaks a door handle. The homeowner can subtract the cost of replacing the handle when paying the final bill. The amount deducted is a setoff.
2. Peter sues Denise for breach of contract, claiming $2,000 in damages. Denise makes a counterdemand for $500, stemming from an unrelated allegation of battery by Peter. Denise's demand for damages is a setoff.