Opinion ID: 1826758
Heading Depth: 1
Heading Rank: 10

Heading: Recoupment and Counterclaim.

Text: In an attempt to circumvent the statute of limitations, Earl pleaded the defense of recoupment, which has been described as a [d]efalcation or discount from a demand. A keeping back something which is due, because there is an equitable reason to withhold it.... .... `Recoupment' differs from `set-off' in this respect: that any claim or demand the defendant may have against the plaintiff may be used as a set-off, while it is not a subject for recoupment unless it grows out of the very same transaction which furnishes the plaintiff's cause of action.... In re Estate of Massie, 218 Neb. 103, 109, 353 N.W.2d 735, 740 (1984), overruled on other grounds, In re Estate of Price, 223 Neb. 12, 388 N.W.2d 72 (1986) (quoting Black's Law Dictionary 1439-40 (4th ed. 1957)). See, also, 80 C.J.S. Set-Off and Counterclaim § 2 (1953). Recoupment may be distinguished from a counterclaim. A counterclaim seeks an affirmative judgment and need not arise out of the same transaction or occurrence which is the basis of a plaintiff's action. Recoupment, on the other hand, must arise out of the same transaction or occurrence which is the basis of a plaintiff's action and is merely defensive, that is, does not seek an affirmative judgment in the action. See Katskee v. Nevada Bob's Golf of Neb., 238 Neb. 654, 472 N.W.2d 372 (1991). A counterclaim, seeking an affirmative judgment or relief, is barred by a statute of limitations unless the counterclaim is filed within the applicable statutory period for commencement of an action. See Katskee v. Nevada Bob's Golf of Neb., supra . Unlike a counterclaim that seeks an affirmative judgment, the defense of recoupment is not barred by a statute of limitations. See, id.; In re Estate of Massie, supra ; Mobil Oil Corp. v. Grantham, 200 Neb. 782, 265 N.W.2d 669 (1978); Nathan v. McKernan, 170 Neb. 1, 101 N.W.2d 756 (1960); Kaup v. Schinstock, 88 Neb. 95, 129 N.W. 184 (1910). Therefore, although Earl's defense of recoupment based on misrepresentation is not barred by the statute of limitations, Earl's counterclaim for misrepresentation is barred by the statute of limitations in § 25-207.