Doctrine of Set-Off

The Doctrine of Set-Off is a legal principle that allows a debtor to reduce the amount they owe to a creditor by considering any debts the creditor owes them. For example, if you owe someone $1,000 but that person also owes you $400, you can “set-off” the debts. Instead of paying the full $1,000, you would only need to pay $600. This helps ensure fairness in financial transactions, allowing parties to settle their accounts more efficiently without needing to make multiple payments.