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Illinois Compiled Statutes

735 ILCS 5/12-178 (2026)

Cases excepted

✓ current as of May 2026
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(735 ILCS 5/12-178) (from Ch. 110, par. 12-178)
    Sec. 12-178. Cases excepted. Such set-off shall not be allowed in the following cases:
    1. When the creditor in one of the judgments is not in the same capacity and trust as the debtor in the other.
    2. When the sum due on the first judgment was lawfully and in good faith assigned to another person, before the creditor in the second judgment became entitled to the sum due thereon.
    3. When there are several creditors in one judgment, and the sum due on the other is due from a part of them only.
    4. When there are several debtors in one judgment, and the sum due on the other is due to a part of them only.
    5. It shall not be allowed as to so much of the first judgment as is due to the attorney in that action for his or her fees and disbursements therein.
(Source: P.A. 82-280.)

    
Notes of Decisions
Cited in 7 cases (1 in the last 5 years), 2012–2024 · leading case: LB Steel, LLC v. Carlo Steel Corp., 2018 IL App (1st) 153501 (Ill. App. Ct. 2018).
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LB Steel, LLC v. Carlo Steel Corp., 2018 IL App (1st) 153501 (Ill. App. Ct. 2018). · cites it 4× “" In response, counsel for LB Steel stated that, pursuant to section 12-178 of the Code of Civil Procedure (Code) ( 735 ILCS 5/12-178 (West 2014) ), "setoff is not appropriate given the different capacities for these different claims.”
Kenny v. Kenny Indus., Inc., 2012 IL App (1st) 111782 (Ill. App. Ct. 2012). · cites it 2× “¶ 21 We also agree with intervenor Bank of America’s argument that the Illinois Code of Civil Procedure (Code) section 12-178 (735 ILCS 5/12-178 (West 2008)) precludes Kenny Industries’ setoff here.”
LB Steel, LLC v. Carlo Steel Corp., 2018 IL App (1st) 153501 (Ill. App. Ct. 2019). · cites it 2× “” In response, counsel for LB Steel stated that, pursuant to section 12-178 of the Code of Civil Procedure (Code) (735 ILCS 5/12-178 (West 2014)), “setoff is not appropriate given the different capacities for these different claims.”
LB Steel, LLC v. Walsh Constr. Co. (In re LB Steel, LLC), 547 B.R. 790 (Bankr. N.D. Ill. 2016). “” 735 ILCS 5/12-178(1) (2014). Similarly, mutuality is required for purposes of setoff under § 553 of the Bankruptcy Code.”
Andrews v. Norfolk S. R.R. Corp., 2017 IL App (1st) 153007 (Ill. App. Ct. 2017). “¶ 14 Plaintiff now contends section 12-178(5) of the Code (735 ILCS 5/12-178(5) (West 2006)), mandates that his attorneys be paid first before any other creditor such as Norfolk Southern and argues this is a procedural matter controlled by state law.”
Andrews v. Norfolk S. R.R. Corp., 2017 IL App (1st) 153007 (Ill. App. Ct. 2017). · cites it 2× “-3- ¶ 14 Plaintiff now contends section 12-178(5) of the Code (735 ILCS 5/12-178(5) (West 2006)) mandates that his attorneys be paid first before any other creditor such as Norfolk Southern and argues this is a procedural matter controlled by state law.”
Potomac Consulting, In c v. IS Constr., Inc., 2024 IL App (1st) 221936-U (Ill. App. Ct. 2024). · cites it 2× “]” 735 ILCS 5/12-178(1) (West 2022). ¶ 20 While it is true that Potomac and ISC were not in the same capacity on February 22, 2021, the date of the court’s initial judgment, Stanila assigned the judgment in his favor and against 7 No.”
— 735 ILCS 5/12-178(1) — 2 cases
LB Steel, LLC v. Walsh Constr. Co. (In re LB Steel, LLC), 547 B.R. 790 (Bankr. N.D. Ill. 2016). “” 735 ILCS 5/12-178(1) (2014). Similarly, mutuality is required for purposes of setoff under § 553 of the Bankruptcy Code.”
Potomac Consulting, In c v. IS Constr., Inc., 2024 IL App (1st) 221936-U (Ill. App. Ct. 2024). “]” 735 ILCS 5/12-178(1) (West 2022). ¶ 20 While it is true that Potomac and ISC were not in the same capacity on February 22, 2021, the date of the court’s initial judgment, Stanila assigned the judgment in his favor and against 7 No.”
— 735 ILCS 5/12-178(2) — 2 cases
Kenny v. Kenny Indus., Inc., 2012 IL App (1st) 111782 (Ill. App. Ct. 2012). “¶ 21 We also agree with intervenor Bank of America’s argument that the Illinois Code of Civil Procedure (Code) section 12-178 (735 ILCS 5/12-178 (West 2008)) precludes Kenny Industries’ setoff here.”
Potomac Consulting, In c v. IS Constr., Inc., 2024 IL App (1st) 221936-U (Ill. App. Ct. 2024). “]” 735 ILCS 5/12-178(1) (West 2022). ¶ 20 While it is true that Potomac and ISC were not in the same capacity on February 22, 2021, the date of the court’s initial judgment, Stanila assigned the judgment in his favor and against 7 No.”
— 735 ILCS 5/12-178(5) — 3 cases
LB Steel, LLC v. Carlo Steel Corp., 2018 IL App (1st) 153501 (Ill. App. Ct. 2018). “" In response, counsel for LB Steel stated that, pursuant to section 12-178 of the Code of Civil Procedure (Code) ( 735 ILCS 5/12-178 (West 2014) ), "setoff is not appropriate given the different capacities for these different claims.”
Andrews v. Norfolk S. R.R. Corp., 2017 IL App (1st) 153007 (Ill. App. Ct. 2017). “¶ 14 Plaintiff now contends section 12-178(5) of the Code (735 ILCS 5/12-178(5) (West 2006)), mandates that his attorneys be paid first before any other creditor such as Norfolk Southern and argues this is a procedural matter controlled by state law.”
Andrews v. Norfolk S. R.R. Corp., 2017 IL App (1st) 153007 (Ill. App. Ct. 2017). “-3- ¶ 14 Plaintiff now contends section 12-178(5) of the Code (735 ILCS 5/12-178(5) (West 2006)) mandates that his attorneys be paid first before any other creditor such as Norfolk Southern and argues this is a procedural matter controlled by state law.”
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