Reformation of contract may be allowed in some situations as a remedy for a breach of contract or other types of contract disputes. To "reform" a contract means to rewrite a portion of it so that it better matches the parties’ intentions. This is usually available in two situations:
- Cases involving mistaken terms in the contract
- Cases involving misrepresentation (either intentional or accidental)
What Parts of a Contract May Be Reformed?
Typically, only the part of the contract that is in dispute will be reformed. It doesn’t make sense to rewrite the entire contract. If rewriting the entire contract was necessary, the parties may as well rescind or cancel the entire agreement.
Instead, the reformation will focus on the source of the dispute, such as a term that caused a mistake of fact, or the term that involved misrepresentation. For instance, suppose a breach of contract occurred because one party meant that the term "pipes" referred to Grade B materials, whereas it actually referred to Grade A materials. Here, the courts might allow the parties to rewrite the contract in a way that defines the term "pipes" more clearly.
In some cases, other sections of the contract may need to be re-written, such as those clauses that were affected by the specific mistake.
Are There Any Defenses to Reformation?
A party may be prevented from obtaining reformation if the other party has an equitable defense. These may include:
- Laches – the plaintiff can’t obtain reformation if they have intentionally delayed in filing a claim to the detriment of the other party
- Unclean hands – the plaintiff can’t obtain reformation if they are guilty of the same type of violation or conduct as the defendant.
Thus, filing for a remedy such as reformation requires careful planning on the part of the party seeking the remedy.
Do I Need a Lawyer for Help with Contract Reformation Issues?
Reformation of a contract can often involve some highly complex legal terms and theories. It’s in your best interests to hire a business lawyer if you need help filing a claim involving a contract dispute. Your lawyer can review the contract in light of state and local laws to determine what options you might have. Also, your attorney can be on hand to provide representation during the times that you need to attend court sessions.