Equitable Recoupment

Definition of Equitable Recoupment

Rule of the law which diminishes the right of a party invoking legal process to recover a debt, to the extent that he holds money or property of his debtor, to which he has no moral right, and it is ordinarily a defensive remedy going only to mitigation of damages. Doctrine of “equitable recoupment” provides that, at least in some cases, a claim for a refund of taxes barred by a statute of limitations may nevertheless be recouped against a tax claim of the government. May Dept. Stores Co. v. City of Pittsburgh, Pa.Cmwlth., 376 A.2d 309, 313.

That's the definition of Equitable Recoupment in Black's Law Dictionary 6th Edition. Courtesy of Cekhukum.com.