This is known as a right of setoff
. If you didn't owe them, this transaction is unlawful and should be reversed.
16 that "[Although no federal right of setoff
is created by the Bankruptcy Code, 11 U.S.C.
16, 18 (1995) ("The right of setoff
(also called 'offset') allows entities that owe each other money to apply their mutual debts against each other, thereby avoiding 'the absurdity of making A pay B when B owes A.'" (quoting Studley v.
extension of the common law right of setoff
in New York Debtor &
The PCC decided to remove this item "because the swap and related variable-rate borrowing involve separate legal contracts that do not meet the requirements for a right of setoff
" (FASB, 2014).
This right of setoff
will need the approval of the new landlord's lenders, and the tenant will want the lender to agree in a non-disturbance subordination and attornment agreement to be expressly bound by this setoff right in the event it forecloses or otherwise becomes the owner and landlord.
Such a right of setoff
is considered unconditional if its exercisability isn't contingent on the occurrence of a future event.
The company may want to ensure that its director's contractual agreements provide for a right of setoff
APB Opinion 10, Omnibus Opinion--1966, and FASB Interpretation 39, Offsetting Amounts Related to Certain Contracts, permit but do not require such balance-sheet offsetting when a right of setoff
The court also held that the surety had no right of setoff
in any event, because the bonds did not provide for profits from one job to be set off against unrelated debts.
10, "Omnibus Opinion 1966"), SAB 92 points out that offsetting assets and liabilities has generally been prohibited except where a right of setoff
The EITF abstract for this issue also includes Securities and Exchange Commission staff guidance on determining the appropriate discount rate and the right of setoff
between the recourse obligation and other related assets.