The set-off exclusion in your contract

An overcharge can be found, confirmed in figures, and still not usable in the way that would be natural — by deducting it from the same carrier’s next invoice. A single contract clause does that.

What the clause does to cash flow

A set-off exclusion means the full invoice amount must be paid and the claim brought separately. The money leaves now and returns — if it returns — later and after a separate process.

The difference is not merely bookkeeping. While the amount is still in your hands the negotiating position is one thing; once it has been paid, another. That is why this clause often matters more than the rate that was actually negotiated.

Three answers, not two

Reading the contract gives one of three results: set-off is clearly permitted, clearly barred, or not addressed at all. The third is not the same as the second, and the report shows it as such — “not established”, not “barred”.

This is not a formality. Where there is no clause, the answer comes from the applicable law and the circumstances, and that is a question for your lawyer. If we showed such a case as “barred”, we would be taking away an option the contract did not take away.

When the clause itself raises a question

Where the clause not only limits set-off but also touches interest for late payment, the report raises a question under Article 7 of Directive 2011/7 — whether the term is grossly unfair and whether it is enforceable under the applicable national law. That is a question for a lawyer, presented with the verbatim quote; we do not assess the validity of the clause.

What wording to ask for

If the contract is being renegotiated, one sentence is enough:

The client is entitled to set off justified invoice claims against amounts payable.