Motion to Offset in Texas

What Is a Motion to Offset?

Background

Rule 302 of the Texas Rules of Civil Procedure states: “If the defendant establishes a demand against the plaintiff upon a counterclaim exceeding that established against him by the plaintiff, the court shall render judgment for defendant for such excess.” Based on Rule 302, if a defendant is awarded a greater monetary judgment than the plaintiff, then the difference between the two judgments should be awarded to the defendant. (Tex. R. Civ. P. 302; Building Concepts, Inc. v. Duncan, 667 S.W.2d 897, 904 (Tex. App—Houston [14th Dist.] 1984, writ ref’d n.r.e.) (“[A]s a matter of law the court was required to offset the amount of damages established by [plaintiff] against the amount of [defendant’s] counterclaim, and to render judgment in favor of [defendant] for the excess.”).)

The Court’s Decision

If Rule 302 does not apply (for example, if plaintiff is awarded a greater award than defendant), it would be appropriate for the Court to offset the damages awards. Texas courts have long recognized that “there is no doubt of the power of courts independent of statute to set off mutual judgments against each other.” (Bonham State Bank v. Beadle, 907 S.W.2d 465, 468 (Tex. 1995) (quoting Simpson v. Huston, 14 Tex. 476, 581 (1855)).) The Texas Supreme Court has stated that offsetting of mutual judgments “is an appropriate judicial response to the serious practical difficulties encountered when parties have mutual judgments, particularly when one of them is impecunious . . .[a] contrary result would leave open the possibility that one . . . could be financially ruined at the hand of another who owed it substantially more than the amount it was otherwise required to pay.” (Id. at 469.)

Timeline

Offset of awards can be accomplished through a declaratory judgment action after final judgments have been issued, or by a motion requesting setoff from the court entering the awards. (See Beadle, 907 S.W.2d at 469; Nu-Way Energy Corp. v. Delp, 205 S.W.3d 667, 684 (Tex. App.—Waco 2006, pet. denied).) A defendant can assert the right of offset as an affirmative defense. (ERI Consulting Engineers, Inc. v. Swinnea 318 SW3d 867, 878 (Tex. 2010) Triton 88, L.P. v. Star Elec., L.L.C., 411 SW3d 42, 60 (Tex. App.—Houston [1st Dist.]. no pet.).) However, some claims can be both an offset as an affirmative defense and a counterclaim. The test to determine which is appropriate is whether the defendant seeks affirmative relief. If the defendant asks for affirmative relief, it is a counterclaim. If the defendant does not ask for affirmative relief, it is an affirmative defense. (See My-Tech, Inc. v. Univ. of N. Texas Health Sci. Ctr. at Fort Worth 166 SW3d 880, 884 (Tex. App. 2005).)

Documents for Motion to Offset in Texas

Sort By

Estate of James Phillip Gist, Deceased document preview

Will - Return Date: December 18,2023

12 pages

{ Ny 1 Bindlin ita WilL& Binding“Last ant iM, Testament” Disbursements of Personal Items on the Death of James Phillip Gist April 3, 2022 P…