UNREPORTED

IN THE COURT OF SPECIAL APPEALS

OF MARYLAND

No. 0556

September Term, 2013

JOANNE DiNOVO

v.

RICHARD McKERNON

Meredith,

Zarnoch,

Reed,

JJ.

Opinion by Zarnoch, J.

Filed: July 29, 2014

In this domestic relations case, appellant Joanne DiNovo seeks our review of a1

decision of the Circuit Court for Montgomery County, which found that DiNovo’s and

appellee Richard McKernon’s marital settlement agreement (“Settlement Agreement”),

contained a mutual mistake of fact concerning DiNovo’s two pensions. We conclude that the

court did not err and affirm the decision below.

FACTS AND LEGAL PROCEEDINGS

DiNovo and McKernon were married on May 8, 1993. They had one daughter, born

May 10, 1997. During the marriage, DiNovo worked as a teacher with the Montgomery

County Public Schools. Their fifteen-year marriage came to an end with a judgment of

absolute divorce granted on May 19, 2008. The judgment of absolute divorce incorporated

the Settlement Agreement previously made on the record at a master’s hearing on April 21,

2008. Since the divorce, the parties have disagreed over the distribution of marital assets,

specifically DiNovo’s pensions.

The Pensions

As a teacher with Montgomery County Public Schools, DiNovo received two

pensions: a base or core pension from the State Retirement and Pension System of Maryland

called the State Teachers’ Pension Plan (“Base Pension”), and a supplemental pension from2

the Montgomery County Public Schools, known as the MCPS Supplemental Pension Plan

“Joanne” is alternatively presented as “Jo Anne” and “JoAnne” throughout the1

record.

Until 2012, this Base Pension was funded entirely by the State. However, in Chapter2

1, Laws of 2012 (1st Spec. Session), the General Assembly required local school boards toshare in the costs of teachers’ retirement.

(“Supplemental Pension”). DiNovo’s Base Pension made up ninety percent of her total3

pension, and the Supplemental Pension made up the remaining ten percent.

A letter to DiNovo from the Employee & Retiree Service Center, Montgomery3

County Public Schools, titled “Personal Statement of Retirement Benefits as of June 30,2006” is the one document in the record that explains the Supplemental Pension. It states inrelevant part:

The Montgomery County Public Schools (MCPS) is pleased to provide yourJune 30, 2006, Annual Statement of Retirement Benefits from theMontgomery County Public Schools Supplemental Pension Plan. Thisstatement reflects the pension improvements approved by the Board ofEducation in May 2006. These enhanced pension benefits reflect the work ofthe Board of Education, our employee organizations, the County Council, andthe state legislature.These improvements increased the supplement paid to members of theMaryland State Teachers’ Pension Plan for years of service after July 1, 1998.The improvements to the MCPS supplement combined with the improvementsto the state plan result in a combined benefit equal to two percent of your finalaverage salary multiplied by your years of service for each year worked afterJuly 1, 1998. As a result, pensions for Maryland educators now compete morefavorably with other states.You receive a statement each fall from MCPS in the same manner as youreceive an annual statement from the Maryland State Teachers’ Pension Plan.The benefit from this plan is a unique pension supplement to your primarystate pension benefit. MCPS is the only school system in the state of Marylandthat provides retired employees with a supplement to the State Teachers’Pension Program.The retirement benefit statement provides information about the annualincome you will receive from this benefit. Your MCPS supplemental pensionis one part of your total retirement package. When you review your post-retirement financial plan, you will need to consider all of your income sourcestogether when planning for your future. Income from your MCPS pension,state pension, social security, and your individual 403(b) and 457(b)retirement savings plans will become your primary sources of income afterretirement.

The Supplemental Pension Plan is authorized by Md. Code (1978, 2014 Repl. Vol.),Education Article, § 5-202(h).

2

Discovery

Prior to their appearances in court, the parties participated in discovery. DiNovo

produced 355 pages of documents to McKernon, two of which show that there are two

pensions. First, a pay stub from DiNovo’s biweeky paycheck showed two deductions for

pensions as “Base Pen” and “Supl. Pen.” The pay stubs do not label these deductions as State

or County. Second, the “Personal Statement of Retirement Benefits as of June 30, 2006”

refers to both the “Montgomery County Public Schools Supplemental Pension Plan” and the

“State Teachers’ Pension Plan.” Each mention of the Supplemental Plan explicitly includes

the word supplemental or supplement. See note 3, supra. A third document related to

pensions is titled “Personal Statement of Benefits as of June 30, 2007.” This document is

from the State Retirement and Pension System of Maryland and makes no mention of a

Supplemental Pension.

As part of discovery, DiNovo answered interrogatories. Interrogatory (13) instructed

her to

List each item of property in which you have any interest. For

each item listed, state how it is titled [and] its value . . . . If you

claim that any property listed is not marital property, state the

facts upon which you based your claim . . . .

DiNovo listed various types of property, some of which she described as “Not marital

property as excluded by agreement.” Relevant to pensions, DiNovo listed:

MCPS Pension Plan

Benefits payable upon reaching retirement age[.]

3

This was the only entry concerning pension plans, and she did not claim any part of it was

not marital property. Interrogatory (14) directed DiNovo to:

Describe all pensions, 401-K’s, IRA’s, C.D.’s or other

retirement plans, benefits or accounts you have had since the

date of your marriage, including in such description all account

numbers, plan administrators, current balances, withdrawals,

dates of vesting, etc.

DiNovo responded: “ANSWER: See previous answer[.]”

Joint Marital and Non-Marital Property Statement

When a monetary award is at issue in a divorce, including an award of a transfer of

interest in a pension, the parties must file a joint statement listing all property owned by

them. See Md. Rule 9-207. McKernon’s counsel, Charles Rand, prepared a document titled

“Husband’s 9-207 Statement.” (hereinafter, “9-207 Statement”). Within the 9-207 Statement,

McKernon listed “MCPS Pension Plan” in the marital property section. Rand explained later

that he simply applied DiNovo’s phrase “MCPS Pension Plan” from her interrogatory

response. DiNovo’s counsel, Brian Barke, signed the 9-207 Statement after making

corrections to some values of other accounts listed on the statement. Barke did not make

corrections to the “MCPS Pension Plan.”

4

Settlement Agreement in the Record

On April 21, 2008, DiNovo and McKernon appeared before family division Master

Clark E. Wisor. Because both Rand and Barke signed the 9-207 Statement, Master Wisor

accepted it into the record as a joint statement. DiNovo and McKernon then entered in to the

Settlement Agreement on the record.

With respect to the pension issue, Barke stated: “So no action is needed on the

timeshare, as is the pension, MCPS Pension Plan, that’s going to be if, as, and when. As to4

the husband’s 401(k), that’s to be split 50-50.” After addressing other issues, like life

insurance and the parenting plan, Rand stated: “That’s all of the changes I have, is there

anything else counsel?” Barke replied,

BARKE: Just to be clear, on the wife’s transfer to husband of her interest

in the Montgomery County Public School’s Pension, will be in

accordance with the Bangs formula, it’s one-half of the marital5

As we have previously explained, 4

the “if, as and when” method, recognizes that the value of a

pension at the time of a divorce cannot be ascertained with

certainty until the employee spouse retires. Kelly v. Kelly, 118

Md. App. 463, 471 (1997). It allows the non-employee spouse

to reap the benefit of an increase in the value of the pension over

time, or, conversely, forces both parties to share in any loss of

value. Bangs v. Bangs, 59 Md. App. 350, 367 (1984).

Potts v. Potts, 142 Md. App. 448, 473 (2002).

The Bangs formula5

calculates the value of the pension to which the non-employee

(continued...)

5

share. And to be clear on – wife will receive from husband’s

401(k) plan a specified amount of $40,716.24. Wife’s receipt of

those funds to an account to be designated by her equalizes the

remaining 401(k), 403(b) accounts.

RAND: That’s correct, counsel.

On May 19, 2008, Master Wisor granted the parties a Judgment of Absolute Divorce. He

ordered “that the terms and provisions of the parties’ agreement placed on the record in open

court on April 21, 2008, a transcript of which is attached hereto as Exhibit ‘A,’ is hereby

incorporated but not merged into this Judgment[.]”

On March 25, 2009, DiNovo moved for a Qualified Domestic Relations Order

(“QDRO”) concerning McKernon’s 401k account, which was granted and distribution was

made. On June 16, 2009, McKernon filed a counterclaim for a QDRO concerning DiNovo’s

interest in the “Montgomery County Public School pension.” For reasons unrelated to this

appeal, DiNovo responded that this QDRO did not comport with the Settlement Agreement

and on October 9, 2009, the counterclaim was voluntarily dismissed without prejudice.

On April 8, 2011, McKernon filed an amended counterclaim requesting QDROs for

the pensions from “both the MCPS and State Retirement Agency of Maryland.” On July 15,

2011, DiNovo answered that the parties’ agreement did not include her “Maryland State

(...continued)5

spouse is entitled as the percentage multiplied by a fraction, the

numerator of which is the number of months and years of the

marriage, the denominator of which is the number of months

and years of employment at the time of retirement.

Potts, 142 Md. App. at 473 (discussing Bangs v. Bangs, 59 Md. App. 350, 367 (1984)).

6

Retirement Pension. The agreement only provides for a distribution of plaintiff’s MCPS

pension.”

2011 Masters Hearing

On December 19, 2011, Master Cockerill presided over proceedings on McKernon’s

amended counterclaim (“2011 Masters Hearing”). At the 2011 Masters Hearing, Shafeena

Yunus, senior specialist for retirement at Montgomery County Public Schools, testified about

the differences between the two pensions. She explained that because attorneys are often

confused that there are two plans, when her office prepares a QDRO that is only for the

Supplemental Pension, as a courtsey it will inform the attorney that they are separate. Her

office informed McKernon’s counsel that the Supplemental Plan was separate in a letter

dated July 9, 2009.

McKernon testified he was not aware during his marriage that there was a Base

Pension and a Supplemental Pension. He said that DiNovo received half his 401(k) and the

“quid pro quo” back for him was half of her pension. When asked to state what deal he

intended to make, McKernon said “that we both split everything 50/50.” DiNovo also

testified at the hearing:

RAND: And Ms. [DiNovo], you’re here asserting that 90 percent of the

pension you earned as a school teacher during the life of the

marriage for 12 years of the marriage is free and clear and

exempt to you, is that right?

DINOVO: I’m not asserting anything.

RAND: You’re not asserting that?

7

DINOVO: No.

RAND: Do you understand that the pension you earned during the life of

the marriage is marital property, do you understand that?

DINOVO: I understand that, yes.

RAND: Okay. And Mr. McKernon is entitled to half of that just like you

were entitled to half of his 401(k), isn’t that right?

. . . .

Isn’t that right, ma’am?

DINOVO: I guess so, yes.

RAND: Okay. And so it’s okay with you, isn’t it, if the Master rules that,

in fact, the MCPS pension plan includes the State’s portion, isn’t

that right? You never intended to exclude it, did you?

. . . .

DINOVO: I intended only what was in the agreement that Scott and I had

when we got divorced.

RAND: So you didn’t know you were excluding, trying to exclude 90

percent of your pension?

DINOVO: No. My intention was to follow the agreement that we had when

we got divorced.

RAND: Was there a negotiation concerning the different [sic], excluding

your 90 percent State pension?

DINOVO: No.

RAND: It was never negotiated by your lawyers or by you, was it?

DINOVO: Not that I know of. I don’t know what you guys did, but we

never negotiated.

8

RAND: The real intent was that the pension, you get half of his 401(k),

he gets half of your pension, wasn’t that the deal?

DINOVO: The deal was whatever we agreed on when we got divorced.

RAND: But there was never any attempt to exclude a portion of your

pension from another portion of it, was there?

DINOVO: No.

Similarly, DiNovo was questioned by her own counsel:

BARKE: Well, I was going to ask when we, when the words were uttered

MCPS pension plan, which plan were we referring to?

DINOVO: Montgomery County Public Schools pension plan.

BARKE: Now the documents that are in evidence that show your State

plan, did the words MCPS pension plan refer to the State, the

Maryland State plan?

DINOVO: No.

. . . .

BARKE: Were there any discussions between your husband whatsoever

as to his participation, if any, in either your Montgomery County

Public Schools pension or your Maryland State Retirement

System pension?

DINOVO: Not specifically.

BARKE: There were discussions about which items?

DINOVO: We just discussed splitting everything evenly. I mean, I don’t

remember us having discussion about things specifically.

. . . .

9

BARKE: Did the agreement that was placed on the record cover, as far as

the MCPS pension plan, cover anything beyond your interest in

the Montgomery County Public Schools supplementary benefit

plan?

DINOVO: No.

(Emphasis added).

Master Cockerill proceeded to ask Barke whether he knew that the Base Pension was

not included in the agreement, and did not receive a clear answer. Finally, after Master

Cockerill asked the question for approximately the fifteenth time, Barke stated, “I did not

know that, of course not. No. You’re asking me a specific question and I will answer it. The

answer is no, but it has nothing to do with the case.” However, in the same proceedings,

Barke told Master Cockerill that “as to the Montgomery County Public Schools Pension[,]

I was absolutely clear, . . . [it] does not include the . . . Maryland State Retirement.” Master

Cockerill responded, “You just said to me . . . you did not know they were separate[.]”

Near the end of the 2011 Hearing, Master Cockerill asked for any documentation that

showed that “MCPS Pension Plan” is the official name for either pension. Barke admitted

that in the official documents it is called the MCPS Supplemental Pension plan. Master

Cockerill pointed out that “MCPS Pension Plan” is a different name than either one of the

plans mentioned, and that Barke signed the 9-207 Statement with that name.

On March 22, 2012, Master Cockerill made an oral finding that the term “MCPS

Pension Plan” was ambiguous. In making his findings, the master read the Settlement

Agreement transcript and noted there were at least three different names to refer to the

10

pension: the MCSP [sic], Montgomery County Public Schools pension, and MCPS Pension

Plan. He explained,

It is described by three different things. . . . Does it mean they

were only dividing her county portion and not her state portion?

I think . . . it is ambiguous. The situation that everybody was in

. . . trying to figure out what this thing meant and both parties

testified that their agreement was that they would divide this

equally. And I find that is, in fact, what they did and that is, so

there should be appropriate QDROs prepared for the total

pension, which is the state portion and the county portion.

Master Cockerill recommended that the circuit court enter an order directing a transfer

of interest of DiNovo’s Base Pension and Supplemental Pension to McKernon. DiNovo filed

exceptions.

2012 Circuit Court Hearing

On May 15, 2012, Judge Steven G. Salant held a circuit court hearing on the

exceptions (“2012 Circuit Court Hearing”). Barke argued that Rand had made the mistake

of including only the Supplemental Pension out of inattentiveness to detail. Judge Salant

asked Barke, “But did you . . . yourself, admit to Master Cockerill that you didn’t know that

they were the two separate pensions?” and Barke responded, “I didn’t say that.” Judge Salant

went on to read from the transcript where Master Cockerill asked Barke if he knew whether

there were two separate pensions, and read the portion where Barke responded “I did not

know, of course not.” At that point, Barke told Judge Salant that he had misunderstood the

question. Barke also asserted that the 9-207 Statement was not a joint document, despite the

fact that he signed it.

11

Judge Salant issued an oral ruling:

The Court does find that there was error in finding that

ambiguity [by the Master]. However, there was testimony, in

fact it was argued here today, that it is not uncommon for

attorneys to mistake the fact that a Montgomery County Public

School teacher’s pension actually consists of two components[.]

. . . .

The Court believes that a genuine question of either a mutual

mistake of fact or a unilateral mistake of fact and fraud on the

other side has been raised. I point to the fact that both parties

signed a 9-207 statement, representing to the Court that these

were the assets of the parties wherein there was only the

Montgomery County Public School pension was listed where

that representation was either untrue or both parties perhaps

thought that, that was essentially her pension and that’s what it

was meant to represent. It was meant to represent all of her

pension assets.

There was no ambiguity on the face of that, what was written,

but a genuine question is generated as to whether there was

mutual mistake of fact or as I say, a unilateral mistake with

fraud or deception committed on the other side. Under both of

those circumstances, the court has the ability, using its equitable

powers to reform a written agreement and enforce it

appropriately.

2012 Master’s Remand Hearing

On December 6, 2012, Master Cockerill held a remand hearing (“2012 Masters

Remand Hearing”). Rand introduced DiNovo’s answers to interrogatories (13) and (14) into

evidence, showing that she had first used “MCPS Pension Plan” to describe her marital

property ownership of all pensions. Master Cockerill asked if Judge Salant knew about the

interrogatories, and the parties explained that the interrogatories were not previously

12

introduced in to evidence. Master Cockerill asked Barke why he did not disclose the Base

Pension:

BARKE: We did disclose it. And–

COURT: In the answers to the interrogatories?

BARKE: In the answers to interrogatories, there is a reference to MCPS pension.

In the documents, there are state retirement pension documents. In the

husband’s testimony before this court, the husband acknowledged

receiving those documents.

. . . .

COURT: Well, why didn’t you include them in the joint marital property

statement?

BARKE: It was not a statement that was joint to the extent that it was

something that I prepared as the plaintiff and handed over to

counsel.

COURT: Joint that you signed it.

BARKE: It was joint that I signed it, yes.

Master Cockerill again asked Barke whether he knew that there were two pensions when he

submitted the 9-207 Statement to the court. This time, Barke answered,

BARKE: We all knew that there were two pensions when that was submitted to

the court. We all knew that.

COURT: So where did the state pension, why wasn’t the state pension

included?

BARKE: Because counsel did not list it on the statement.

COURT: But you signed it.

13

On February 6, 2013, Master Cockerill filed a written report and recommendations.

Master Cockerill found that “that there was a mutual mistake of fact which supports a

reformation of the contract between the parties” because “[i]t is clear that both parties

mistakenly believed that the stipulation before Master Wisor included all teachers’ pensions

and that the Defendant was to receive one-half of the Plaintiff’s total teachers’ pensions.” He

explained that “a court of equity will reform a written instrument to make it conform to the

real intention of the parties, when the evidence is so clear, strong and convincing as to leave

no reasonable doubt that a mutual mistake was made contrary to their actual agreement.” On

February 15, 2013, DiNovo filed exceptions.

2013 Circuit Court Hearing

On April 9, 2013, Judge Salant held a second exceptions hearings, during which he

overruled DiNovo’s exceptions and sustained Master Cockerill’s findings. Judge Salant said:

I think it is crystal clear, beyond doubt, really, that the parties

sought to divide their pensions equally. . . . So, my review of the

evidence comes down to two different scenarios. One scenario

is where both parties did not know that the statement of her

retirement plan, the Montgomery County Public School

retirement plan, did not include the state pension. If both of

them did not know that, then that is a mutual mistake of fact,

because their clear intent was to divide those pensions equally.

So essentially, they both mistakenly excluded 90 percent of her

pension. I can’t think of a bigger mistake of fact than that

clearly. If they both knew that there was a state pension

component, then it seems to me that both of them thought, or

represented by way of that 9-207 statement that was signed by

both parties, was that her pension, as represented on that

document, represented both of those things, in which case, that

was a mistake of fact. It may have been clear, it may not have

14

been ambiguous, but did not reflect their intent. It didn’t reflect

their mutual intent. So in either scenario, if they both knew or

they both didn’t know, we have mutual mistake of fact.

On April 15, the circuit court issued an order granting McKernon’s request for a QDRO

equally dividing both pensions pursuant to the Bangs formula. On May 8, DiNovo timely

filed this appeal. Additional facts will be provided as necessary in our discussion of the

issues.

QUESTION PRESENTED

DiNovo presents the following question, which we have rephrased, for our review:6

Did the circuit court err in reforming DiNovo and

McKernon’s Settlement Agreement to include the

Base Pension and the Supplemental Pension?

We answer in the negative, and affirm the decision of the circuit court.

In her brief, DiNovo asks: 6

Whether the circuit court erred in reforming the parties’ April21, 2008 divorce settlement agreement, finding that the parties’had mutually mistakenly believed and/or intended that theirreference in their marital settlement agreement to the Wife’sMCPS Pension included her Maryland State Teachers Pension,after the court had earlier ruled that the references to the MCPSpension was unambiguous, the Wife had testified that theagreement did not cover anything beyond her interest in theMCPS Pension, and the Husband acknowledged that prior toentering the agreement, he was aware of and had receiveddocuments reflecting wife’s two separate pensions?

15

DISCUSSION

I. Standard of Review

This case requires us to construe a settlement agreement which was incorporated, but

not merged, into a judgment of absolute divorce. “Such agreements are subject to the general

rules of contract interpretation.” Janusz v. Gilliam, 404 Md. 524, 534 (2008). Contract

interpretation is a question of law and subject to de novo review. Hearn v. Hearn, 177 Md.

App. 525, 534-35 (2007). However, the judgment of the trial court in actions for reformation

will not be “set aside on the evidence unless clearly erroneous.” Brady v. Berke, 33 Md. App.

27, 31 (1976).

Usually, “parol evidence is inadmissible to vary or contradict the terms of a written

instrument.” Hoffman v. Chapman, 182 Md. 208, 210 (1943) (Citations omitted). However,

“equity refuses to enforce this rule [that parol evidence is generally inadmissible] whenever

it is alleged that fraud, accident or mistake occurred in the making of the instrument, and will

admit parol evidence to reform the instrument[.]” Id. We will reform an agreement “to make

it conform to the real intention of the parties, when the evidence is so clear, strong and

convincing as to leave no reasonable doubt that a mutual mistake was made in the instrument

contrary to [the parties’] agreement.” Id.

When “a provision in a contract is susceptible to more than one interpretation, a

construction which makes the contract fair and reasonable will be preferred to one which

leads to either a harsh or unreasonable result. Contract provisions must be viewed in the

16

context of the entire contract rather than construing each term separately.” Azat v. Farruggio,

162 Md. App. 539, 550 (2005).

II. Reformation of Contract

DiNovo contends that there was not convincing evidence of mutual mistake of fact

because “[s]imply concluding that the parties intended something other than the

unambiguous objective meaning of the express language of an agreement does not constitute

a mistake of fact or law.” She argues that “MCPS Pension Plan” referred only to her7

As in cases involving mutual mistake, the trial court may also receive parol evidence7

when ambiguity is present. Young v. Anne Arundel Cnty., 146 Md. App. 526, 587 (2002).

However, “[t]he burden of persuasion upon a party seeking reformation [due to mutual

mistake] is significantly higher than the preponderance standard used to determine the

existence of an ambiguity.” Higgins v. Barnes, 310 Md. 532, 538 (1987). If appellate courts

agree after de novo review that contract language is ambiguous, we will “apply a clearly

erroneous standard to the trial court’s assessment of the construction of the contract in light

of the parol evidence received.” Calomiris v. Woods, 353 Md. 425, 435 (1999).

DiNovo contends that the contract is not ambiguous, while McKernon argues that “the

issue of ambiguity has not been further aired” since the 2012 Circuit Court Hearing

determined that the 2011 Masters Hearing finding of ambiguity was in error. McKernon

notes that the 2012 Masters Remand hearing returned a finding of mutual mistake, and the

2013 Circuit Court Hearing sustained those findings. However, he argues that because both

ambiguity and mutual mistake require parol evidence of intent, the result will be the same.

To determine whether a contract is ambiguous, we follow the object view of contract

interpretation. Calomiris, 353 Md. at 435-36. Under this view, “a written contract is

ambiguous if, when read by a reasonably prudent person, it is susceptible of more than one

meaning.” Id. “The determination of whether language is susceptible of more than one

meaning includes a consideration of the character of the contract, its purpose, and the facts

and circumstances of the parties at the time of execution.” Id.

However, a contract is not ambiguous “merely because the parties to it do not agree

as to its meaning.” Young, 146 Md. App. at 587. We also note that “[a] contract’s silence on

a particular issue does not, by itself, create ambiguity as a matter of law, even though silence

creates ambiguity when it involves a matter naturally within the scope of the contract.” Azat

(continued...)

17

Supplemental Pension because there was no mention of her Base Pension. Finally, DiNovo

suggests that at most this is a unilateral mistake of McKernon, since he was aware of her two

separate pensions prior to entering in to the Settlement Agreement.

McKernon contends that the circuit court found all of the elements required for

reformation based on mutual mistake, and that reformation was proper based on the parties’

intent.

We determine that the circuit court was correct in reforming the Settlement Agreement

based on mutual mistake. “Equity will reform a contract where there has been a mutual

mistake of fact in the formation of the contract.” Janusz, 404 Md. at 535-36.

A court of equity would be of little value . . . if it could suppress

only positive frauds, and leave mutual mistakes, innocently

(...continued)7

v. Farruggio, 162 Md. App. 539, 551 (2005).

Here, though the circuit court’s decision rested on mutual mistake, and the court had

previously indicated that the agreement was not unclear, the court’s latter opinion, in our

view, implicitly found that the “MCPS Pension Plan” was ambiguous. The term can clearly

be interpreted by a reasonable person to have more than one meaning because the circuit

court judge did just that. The judge stated that there were two scenarios created by the term,

one where the parties either “both knew or they both didn’t know.” He explained that the

parties either both knew that there were two pensions and meant for the term “MCPS Pension

Plan” to represent both pensions, or the parties did not know that there were two pensions

and thought the term “MCPS Pension Plan” represented the one, full pension. In our view,

these two interpretations create ambiguity in the term.

Additionally, the Base Pension is clearly “a matter naturally within the scope of the

contract,” Azat, 162 Md. App. at 551, because DiNovo was required to list all of her pensions

and all of her marital property. Therefore, the silence in the contract with respect to the Base

Pension also creates ambiguity within the term “MCPS Pension Plan.”

Whether the court considered the issue as one of ambiguity or mutual mistake, thecourt was permitted to look at parol evidence to determine the parties’ intent.

18

made, to work intolerable mischiefs contrary to the intention of

parties. It would be to allow an act, originating in innocence, to

operate ultimately as a fraud by enabling the party, who receives

the benefit of the mistake, to resist the claims of justice under

the shelter of a rule framed to promote it.

Hoffman, 182 Md. at 210-11 (Citations omitted). A mutual mistake occurs when “both

parties hav[e] done that which neither of them intended.” Brockmeyer v. Norris, 177 Md.

466, 473-74 (1940).

To make a claim for reformation based on mutual mistake, the party must show (1)

the existence of a mutual mistake of fact; (2) the intentions of the parties in making the

agreement; and (3) that because of the mistake, the agreement fails to represent the intentions

of the parties. Brady, 33 Md. App. at 31; see also Brockmeyer, 177 Md. at 473-74 (“[A] court

of equity has ample powers to make [a contract] conform to the intention of the parties, if by

mutual mistake it fails to express their real intentions or contains terms or stipulations

contrary to their common intention, provided the evidence be of a character to justify such

action of the court.”). The burden of proof for reformation is “clear, strong, and convincing”

evidence. Brady, 33 Md. App. at 32. Reformation is proper in a case where a mistake of a

draftsman, “whether from carelessness, forgetfulness or lack of skill,” fails to express the

manifest intention of the parties. Painter v. Delea, 229 Md. 558, 564-65 (1962).

Here, there was strong evidence on each element of reformation. Regarding evidence

of a mistake, we first note that the term “MCPS Pension Plan” is not the official name of the

Supplemental Plan. When the Supplemental Plan appears on the pay stub or in the document

19

titled, “Personal Statement of Retirement Benefits as of June 30, 2006,” it is always includes

the rather critical description “supplemental.” Additionally, DiNovo first used the term as8

an answer to her interrogatories in a way that implied that it accounted for any pension she

may receive. Her attorney, Barke, signed McKernon’s 9-207 Statement indicating that the

“MCPS Pension Plan” was a total statement of the marital assets. Barke corrected other items

on the 9-207 Statement, but not the section describing the pensions. Even if McKernon

should have been aware that there was a Base Pension and Supplemental Pension through

discovery, there is no indication that the term “MCPS Pension Plan” as used in the 9-207

Statement does not cover both of the plans.

As Judge Salant explained, whether the parties knew that the term “MCPS Pension

Plan” would not include DiNovo’s Base Pension, or whether the parties meant the term to

refer to both pensions, “essentially, they both mistakenly excluded 90 percent of her pension.

I can’t think of a bigger mistake of fact than that[,] clearly.”

Second, there was evidence of the parties’ intent. DiNovo testified that she was not

trying to exclude her Base Pension nor shield it from being divided. Both DiNovo and

McKernon testified that they intended to split their marital assets “50/50.” As Judge Salant

explained, “I think it is crystal clear, beyond doubt, really, that the parties sought to divide

Use of the correct term “supplemental” would have put McKernon and his lawyer8

on notice that there was another pension.

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their pensions equally. Period. Whether it was a 401(k), whether it was a pension as to which

the plaintiff was entitled, it is clear[.]”

Finally, there was evidence that the effect of the Settlement Agreement was not

contemplated by the parties’ original intent. The court concluded:

There is no evidence that I found in my review of

this case where [DiNovo] makes the argument

that [she and McKernon] negotiated somehow

that the state pension was not going to be part of

this deal. There was nothing in the record that

shows the parties deviated from their intent,

which was to divide their assets equally, their

retirement assets equally.

Additionally, Judge Salant pointed to testimony “that attorneys themselves often confuse that

fact there are two components of the pension.” We conclude that all of this evidence is

sufficient for a determination that there was a mutual mistake, and the court was correct to

reform the parties’ Settlement Agreement to apply to both DiNovo’s Supplemental and Base

Pension.

For all of these reasons we affirm the judgment of the circuit court.

JUDGMENT OF THE CIRCUIT COURT

F O R M O N T G O M E R Y C O U N T Y

AFFIRMED. COSTS TO BE PAID BY

APPELLANT.

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