What is Reformation and Why and How is it Used?
In life, mistakes happen. But when they happen when a contract or other legal document is written, it can have severe consequences; the rights, duties, and expectations of the parties can be forever altered because of an error in a document.
What Did the Parties Intend?
Contracts as a matter of law are supposed to reflect the will and intentions of the parties. Sometimes, because of mistakes, they don’t. When they don’t, parties have the right to ask the court to reform—essentially to correct—an error in a document.
Note that reformation is not asking for a contract to be voided or invalidated as would be the case for a claim for rescission of an agreement.
Rather, it is asking the court to maintain the integrity of the legal document but to change wording or terms within the document.
What Can be Reformed?
A court can reform a contract but can also reform other, non-contractual documents, like deeds or titles or liens.
Deeds are often reformed when descriptions of properties or boundary lines or the names of the owners on the deed are incorrect.
How to Get Reformation
In order to show that there was a mistake warranting a reformation, the party seeking reformation needs to show evidence that the document does not reflect what the parties intended or bargained for. The reformation must be proven by clear and convincing evidence—a much higher burden than the normal preponderance of evidence standard (or 51% of the evidence) in normal civil cases.
Reformation, if granted, must simply reflect the original will and intent of the parties; it cannot be used to supply or omit terms that were never agreed to or left out of the document intentionally by the parties.
It also normally can’t be used to give or take away any obligations or rights of the parties to the contract other than that which may happen because of wording changes.
Reformation often reflects circumstances which were unintended by the parties or unknown by them at the time of contracting. Reformation can happen when both parties make a mutual mistake about a term, fact, or circumstance, that would affect the contract.
Known misrepresentations or purposeful errors are more likely to give rise to fraud claims or requests to rescind (invalidate) a contract. Courts will look to make sure that neither party had any hand in the error (which legally would be considered unclean hands).
As you can see, proving this often involves presentation of the pre contractual understandings and negotiations between the parties.
Often, the error that gives rise to reforming a contract would unjustly enrich one party over another or would make it unconscionable to enforce the agreement as it is presently written.
Let us help you with your reformation or rescission case or any contractual matter you may have. Call the West Palm Beach commercial litigation attorneys at Pike & Lustig today.
Source:
floridabar.org/the-florida-bar-journal/more-than-you-wanted-to-know-about-the-doctrine-of-reformation/
