Legal Definition of recoupment
1 : the process or fact of recouping recoupment of expenses
2a : a keeping back of all or part of a sum sought by a plaintiff in the interest of equity — see also equitable recoupment
b : a reduction in damages because of a demand by the defendant arising out of the same occurrence or transaction
c : the right of a defendant to have the claim of the plaintiff reduced or eliminated by reason of a breach of contract or duty by the plaintiff in the same occurrence or transaction also : an affirmative defense alleging such a breach
: a counterclaim that arises out of the same occurrence or transaction as that of the original action — compare set-off
Recoupment involves the type of claim that now must be asserted in a compulsory counterclaim.
Note: Recoupment involves the type of claim that now must be asserted in a compulsory counterclaim.