In Delaware, the Court of Chancery has the power to reform an agreement that “fails to express the [parties'] real agreement or transaction,” as in Miller v. National Land Partners LLC, C.A. No. 7977-VCG, at 34 (Del. Ch. June 11, 2014), citing Amstel Associates LLC v. Brinsfield-Cavall Associates, (Del. Ch. May 9, 2002). However, for a plaintiff to obtain reformation based on a mutual mistake, he or she must demonstrate by “clear and convincing evidence” that the written agreement failed to reflect accurately the oral agreement reached by the parties.
In Miller, the court decided whether management agreements between real estate development partners should be reformed to require a 12.5 percent guaranteed profit to one of the partners. The dispute arose in the context of an almost $5 million transfer, based on the guaranteed profit, that would have had the effect of reducing compensation due to one partner’s spouse under a divorce decree. Following trial, the court found the burden of demonstrating a mutual mistake had been met and that, because the missing term requiring the payment was inadvertently deleted, the management agreements should be reformed.
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Not a Bloomberg Law Subscriber?
LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.
For questions call 1-877-256-2472 or contact us at [email protected]