Reformation, an equitable remedy that permits a court to reform a contract or deed, is governed by Cal. Civil Code § 3399, which states: “[w]hen, through fraud or mutual mistake of the parties, or a mistake of one party, which the other at the time knew or suspected, a written contract does not truly express the intention of the parties, it may be revised on the application of a party aggrieved, so as to express that intention, so far as it can be done without prejudice to rights acquired by third persons, in good faith and for value.”

“Reformation is proper when the parties come to a true agreement, but by reason of fraud or mistake, that intent is not expressed in the written instrument.” (See Shupe v. Nelson (1967) 254 Cal.App.2d 693, 699.) “The burden is on the party seeking reformation to demonstrate that the true intent of the agreement was something other than what is reflected by the instrument.” (Id. at 700.)

There can be no reformation of a written document to reflect the actual mutual agreement if there was no preceding agreement. (See Lemoge Elec. V. San Mateo County (1956) 46 Cal.2d 659, 663.)

Purpose of Reformation

“The purpose of reformation is to correct a written instrument in order to effectuate a common intention of both parties which was incorrectly reduced to writing. To justify the court in changing the language of the instrument sought to be reformed, it must be established that both parties agreed to do something different from what is expressed in the writing, and the proof upon this point should be clear and convincing.” (Lister v. Sorge (1968) 260 Cal.App.2d 333, 338.)

No Reformation Without a Proper Contract

“If the contract itself is void, as, for example, because it is immoral or because the parties have not agreed on all of its terms and there is, for that reason, no final contract or understanding between them, or because the contract lacks consideration, reformation is impossible, since there is no valid contract to reform.” (Oatman v. Niemeyer (1929) 207 Cal. 424, 426-427.)

“California recognizes the objective theory of contracts (Berman v. Bromberg (1997) 56 Cal.App.4th 936, 948), under which ‘[i]t is the objective intent, as evidenced in words of the contract, rather than the subjective intent of one of the parties, that controls interpretation’” (Titan Group Inc. v. Sonoma Valley County Sanitation Dist. (1985) 164 Cal.App.3rd 1122, 1127.)

Fraud and Reformation

Lane v. Davis (1959) 172 Cal.App.2d 302 is instructive. It holds “[]... fraud which constitutes a ground for reformation consists of the representation that the writing is in conformity with the intended agreement, or that a writing to be made will be in conformity therewith.” (Id. citing 2 Witkin, California Procedure at 1397.) “The fraud alleged in the instant complaint went only to the inducement to enter into the contract and fraud of this character will not warrant reformation for the obvious reason that there is no common intention or understanding between the parties that may be utilized as a standard to which the writing could be reformed.” Id. at 307-08.

Statute of Limitations

“A statute of limitations runs against an action for the reformation of an instrument from the date on which the right to reformation accrues.” (See 54 C.J.S. Limitations of Actions § 310.)