Setoff examples

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.