Brvenik v. Kavanagh

majority opinion

Jason Ronald Brvenik v. Brooke Ann Kavanagh, Nos. 1187 & 2058, Sept. Term, 2024. Opinion by Tang, J.

REFORMATION OF INSTRUMENTS – RIGHT OF ACTIONS AND DEFENSES –

GROUNDS FOR REFORMATION – MISTAKE AND FRAUD

One of two circumstances must exist before a court of equity will reform a written contract: either mutual mistake; or fraud, duress, or inequitable conduct.

Mutual mistake exists where there has been a meeting of the minds—and an agreement actually entered into, but the instrument, in its written form, does not express what was intended by the parties thereto.

A written instrument can also be reformed when a mistake is made by one of the parties accompanied by fraud, duress, or other inequitable conduct practiced on the person making the mistake by another party. In the case of fraud or inequitable conduct, if one party at the time of the execution of a written agreement knows that it does not accurately express the intention of the other party, and also knows what that intention is, the latter can have the agreement reformed so that it will express that intention.

The equitable remedy of reformation was available to the ex-wife, who sought to revise a provision in the marital settlement agreement regarding the calculation of her equity in the parties’ lake house. The ex-wife’s attorney inadvertently deleted a material phrase during the final exchange of redlines. The ex-husband was aware of this deletion but did not disclose the clerical error before signing. The court reformed the provision to reflect the ex-wife’s intent by including the deleted phrase.

EVIDENCE – ADMISSIONS – ACTS OR CONDUCT – COMPROMISE OR

SETTLEMENT

Evidence regarding the deletion of a material phrase in the marital settlement agreement before execution was not barred by Maryland Rule 5-408, which governs compromise and offers to compromise. The ex-wife did not seek to admit the evidence to prove the validity or invalidity of a claim but offered it for another purpose—specifically, to show that the deletion was a mistake.

Circuit Court for Howard County

Case No. C-13-FM-22-001601

REPORTED

IN THE APPELLATE COURT

OF MARYLAND

Nos. 1187 & 2058

September Term, 2024

JASON RONALD BRVENIK

BROOKE ANN KAVANAGH

Zic,

Tang,

Kenney, James A., III

(Senior Judge, Specially Assigned),

JJ.

Opinion by Tang, J.

Filed: July 1, 2026

Pursuant to the Maryland Uniform Electronic Legal

Materials Act (§§ 10-1601 et seq. of the State

Government Article) this document is authentic.

2026.07.01

12:20:01 -04'00'

Gregory Hilton, Clerk

Jason Brvenik, the appellant, noted two appeals from two separate orders entered

by the Circuit Court for Howard County concerning a section of the marital settlement

agreement (“MSA”) between him and his former wife, Brooke Kavanagh, the appellee,

regarding the disposition of their lake house. The issues raised in the second appeal depend

on the resolution of the primary issue in this first appeal, which we rephrase as follows:

Did the circuit court err in reforming the MSA?

For the reasons set forth below, we affirm the judgment. 1

This Court consolidated the two appeals. In the first appeal (ACM-REG-1187-2024), Mr. Brvenik primarily challenges the circuit court’s reformation of the MSA and the award of attorney’s fees under the MSA’s prevailing party provision. In his brief, he raises the following issues:

I. Did the Circuit Court for Howard County err in admitting as parol

evidence offers of compromise and settlement?

II. Did the Circuit Court for Howard County err in making an erroneous

finding of fact that [Mr. Brvenik’s] attorney’s research into Mutual

Mistake post-execution of the [MSA] was evidence that [Mr. Brvenik]

knew that the accepted agreement contained a scrivener’s error?

III. Did the Circuit Court for Howard County err in determining that there

was a mutual mistake in the drafting of the parties[’] [MSA]?

IV. Did the Circuit Court for Howard County err in awarding attorney’s

fees?

After reforming the MSA, the circuit court granted Ms. Kavanagh’s motion to enforce it, finding that Mr. Brvenik breached the MSA regarding the disposition of the lake house. The court awarded Ms. Kavanagh additional attorney’s fees and ordered the appointment of a trustee to sell the lake house. Mr. Brvenik noted a second appeal (ACMREG-2058-2024), raising two issues, which we have renumbered sequentially to follow those in the first appeal:

V. Did the Circuit Court err in enforcing the reformed agreement?

VI. Did the Circuit Court err in awarding attorney’s fees to [Ms. Kavanagh]

for seeking to enforce the reformed agreement?

BACKGROUND

Mr. Brvenik and Ms. Kavanagh were divorced pursuant to an order of judgment of

absolute divorce entered on July 20, 2023. The judgment incorporated, but did not merge,

the parties’ MSA, executed on July 12, 2023. Each side was represented by counsel who

negotiated the terms of the MSA.

On December 29, 2023, Ms. Kavanagh filed a Motion to Reopen Case and for Other

Relief. She requested that the court reopen the case and reform the MSA due to a clerical

error in the language affecting the calculation of her equity in the lake house. Mr. Brvenik

opposed the motion. 2 The court held a hearing on May 28, 2024, during which the parties

Regarding issue V, Mr. Brvenik states that the appeal is to “preserve” his rights under the MSA if the judgment of reformation is reversed. Similarly, for issues IV and VI, he states that if the court’s decisions to reform the MSA and grant the motion to enforce are reversed, the fee awards would be “inappropriate” and should be reconsidered by the circuit court.

For the reasons stated in this opinion, we affirm the court’s judgment of reformation. Mr. Brvenik offers no argument supporting issues IV through VI if the judgment of reformation is affirmed. See Md. Rule 8-504(a)(6) (requiring that briefs contain “[a]rgument in support of the party’s position on each issue”); Klauenberg v. State, 355 Md. 528, 552 (1999) (concluding that question of whether the trial court erred in denying a motion for mistrial was waived on appeal where “[a]ppellant proffer[ed] no argument as to why the trial court abused its discretion in denying the motion for mistrial”). Accordingly, we decline to address these issues and need not summarize the related facts or procedural history.

Prior to the hearing, Mr. Brvenik filed a motion to dismiss Ms. Kavanagh’s motion, arguing that she was effectively seeking to revise the judgment of absolute divorce, which he asserted was untimely and improper under Maryland Rules 2-534 and 2-535. The court denied Mr. Brvenik’s motion to dismiss. On appeal, Mr. Brvenik neither raises this issue in his statement of the questions presented nor articulates any argument in his briefs that the court erred in denying his motion to dismiss Ms. Kavanagh’s motion. Accordingly, we do not address this issue.

and their respective counsel testified. We summarize the relevant evidence in the light most

favorable to Ms. Kavanagh as the prevailing party. See Dynacorp Ltd. v. Aramtel Ltd., 208

Md. App. 403, 451 (2012).

Lake House

The provision at issue relates to the disposition of the parties’ lake house, which is

owned as tenants by the entireties and subject to a lien of mortgage in Mr. Brvenik’s name.

Paragraph 3.b.i of the MSA provides that the parties agree to sign a listing agreement for

the sale of the lake house no later than September 24, 2023, and that the net proceeds from

the sale would be divided equally between the parties. Subsection 3.b.ii sets forth the

procedure for establishing the listing price.

Subsection 3.b.iii grants Mr. Brvenik the option to purchase Ms. Kavanagh’s equity

in the lake house and outlines how her equity is to be calculated. The subsection at issue in

this appeal is 3.b.iii.B, reproduced and highlighted below, from the executed version of the

MSA that was incorporated but not merged into the order for judgment of absolute divorce:

iii. Notwithstanding the foregoing, Husband shall have the option to purchase

Wife’s Equity in the Lake House until the later of such time as the parties’

[sic] accept a bona fide, third party offer or December 31, 2023. Wife’s

Equity shall be determined as set forth below.

A. Husband shall obtain a certified appraisal for fair market value of the

Lake House and present the same to Wife. If Wife does not agree with

Husband’s certified appraisal, Wife shall notify Husband of her objection

and obtain her own certified appraisal for fair market value of the Lake

House and present the same to Husband. If Husband does not agree with

Wife’s certified appraisal, or the parties are unable to otherwise agree

upon a fair market value of the Lake House, then the average of the

parties’ two (2) appraisals shall be used to determine the fair market value

of the Lake House.

B. The fair market value of the Lake House shall be the existing

mortgage balance at the time of the buy-out, and then multiplied by

50%. The remaining sum shall be Wife’s Equity.

C. Upon receipt of payment in an amount equal to Wife’s Equity, Wife

agrees to convey to Husband all of her right, title and interest in and to

the Lake House . . . . All costs associated with the conveyance of the Lake

House to Husband shall be the sole responsibility of Husband . . . .

In early October 2023, Mr. Brvenik obtained an appraisal of the lake house pursuant

to subsection iii.A, with both parties agreeing on the appraised value of $823,000. They

scheduled to meet on November 7, during which Mr. Brvenik was to pay Ms. Kavanagh

her share of the equity in exchange for her signing the deed over to him. Prior to the

meeting, she texted him requesting a copy of the mortgage payoff balance and the cashier’s

check for her equity, which she expected to exceed $291,000.

Unbeknownst to her, Mr. Brvenik significantly reduced the mortgage balance by

approximately $240,000 between the judgment of divorce and November 7, leaving a

balance of $5,092.75. When they met on November 7, Mr. Brvenik attempted to pay Ms.

Kavanagh $2,552.63, representing her equity—half of the existing mortgage balance

pursuant to subsection iii.B as written, supra. However, Ms. Kavanagh refused to sign the

deed conveying her interest in the lake house to him.

Deletion of “Reduced By”

As stated, Ms. Kavanagh moved to reopen the case, seeking reformation of

subsection iii.B of the MSA. She asserted that subsection iii.B should be reformed because

her attorney inadvertently deleted a material phrase during the final revisions and that she

intended to state that her equity in the lake house is calculated by taking the appraised, fair

market value ($823,000), reducing it by the existing mortgage balance, and then

multiplying the result by 50%. In other words, she contended that subsection iii.B should

have read:

B. The fair market value of the Lake House shall be reduced by the existing

mortgage balance at the time of the buy-out, and then multiplied by 50%.

The remaining sum shall be Wife’s Equity.

(emphasis added).

At the evidentiary hearing, Ms. Kavanagh’s attorney explained how the mistake

occurred. She testified that “[o]nce the parties had reached an agreement on terms,” Mr.

Brvenik’s attorney drafted the MSA and that draft “went back and forth several times”

between the two of them. She made the “last revision[s],” which she emailed to Mr.

Brvenik’s attorney on July 11, 2023. Her redlines to subsection iii.B were as follows:

B. The fair market value of the Lake House shall then be reduced by a) five

percent (5%) of the fair market value of the Lake House, and b) the existing

mortgage balance at the time of the buy-out, and then multiplied by 50%.

The remaining sum shall be Wife’s Equity.

Ms. Kavanagh’s attorney testified that she inadvertently deleted “reduced by” in the

process of deleting the clause, “a) five percent (5%) of the fair market value of the Lake

House, and b).” Ms. Kavanagh’s attorney confirmed that the method for calculating the fair

market value of the lake house was never a point of contention between the parties. She

explained that the phrase “reduced by” “should have remained,” and that the actual

“negotiating points” related to provisions under “little a and little b.”

Ms. Kavanagh’s attorney further confirmed that she and Mr. Brvenik’s attorney

never discussed the fair market value of the lake house being equal to the mortgage balance,

nor had she been involved in any other cases where the fair market value of real property

was determined as the mortgage balance. She also testified that she never had conversations

with opposing counsel about altering the fifty-fifty division of marital property to allow

Mr. Brvenik to retain the “lion[’s] share” of the lake house.

Mr. Brvenik’s attorney testified that he did not recall any discussions with Ms.

Kavanagh’s attorney about changing the language in subsection iii.B to equate the fair

market value of the lake house with the mortgage balance. When asked why an appraisal

under subsection iii.A was necessary if the fair market value was simply equal to the

existing mortgage balance, counsel stated that he did not know.

Mr. Brvenik testified. He indicated that he actively participated in negotiating the

MSA through his attorney. He acknowledged that he first became aware that subsection

iii.B read that the fair market value of the lake house would have equaled the mortgage

balance when the redlines were presented to him on July 11, 2023. He stated that he was

not surprised by that redline, as it seemed to him that Ms. Kavanagh was making a

concession in exchange for the numerous benefits she was receiving under the MSA.

After the parties signed the MSA and it was incorporated into the order for judgment

of absolute divorce on July 12, Mr. Brvenik retained new counsel on July 21 to address a

“potential post-judgment matter.” His fee invoices, some with unredacted entries, were

admitted without objection. The unredacted portions revealed that on August 1 and 2, Mr.

Brvenik’s new counsel researched the “standard for mistake in an agreement and court’s

authority to amend signed MSA” and drafted a memo. On August 3, counsel amended the

memo to “include additional research on the courts’ definition of mutual mistake.” When

questioned about these entries, Mr. Brvenik claimed that he had engaged new counsel to

review the MSA due to a potential dispute over a wedding ring.

Ms. Kavanagh also testified. She stated that she was unaware of her attorney’s

mistake in redlining and only learned of the error on November 7, 2023, when Mr. Brvenik

pointed out the language in the executed version of the MSA. She further testified that she

would not have signed the MSA if she knew about the mistake.

During closing arguments, Ms. Kavanagh argued through counsel that Mr. Brvenik

was aware of the redlining mistake before signing the MSA and exploited it. Therefore, she

requested that subsection iii.B should be reformed to reflect her intended inclusion of

“reduced by.”

Court’s Ruling

At the end of the hearing, the court gave its oral ruling and decided to reform the

language of subsection iii.B of the MSA. The court found that Ms. Kavanagh’s attorney

made a clerical error by deleting the phrase “reduced by” from the subsection. It explained

that the error was obvious because, without the phrase, the subsection—when read

alongside related subsections—became nonsensical. Specifically, it observed that

subsection iii provided for determining Ms. Kavanagh’s equity based in part on the fair

market value of the lake house, which was to be established by first obtaining an appraisal

under subsection iii.A. The court noted that an appraisal would be unnecessary if

subsection iii.B stood as redlined, as there would be no reason to obtain an appraisal when

the fair market value would simply equal the mortgage balance. The court further explained

that consistent with “principles of marital property,” property valuation is based on “net

equity” rather than equating value with the amount of debt on the property.

The court further found the mistake to be mutual, concluding that Mr. Brvenik knew

the deletion of “reduced by” was a mistake. It did not find credible Mr. Brvenik’s testimony

that he believed Ms. Kavanagh intended to delete the phrase. It found that Mr. Brvenik was

an active participant in the negotiations, that the deletion of the phrase “was not what was

negotiated [and] discussed,” and that both attorneys confirmed it was never discussed in

that manner.

Moreover, the court explained that the entries in Mr. Brvenik’s post-divorce fee

invoice showing that his new counsel researched the issue of mutual mistake corroborated

Mr. Brvenik’s knowledge that the deletion of the phrase was a mistake. The court did not

find it credible that he had engaged another law firm immediately following the divorce

because he wanted advice about his potential liability regarding the wedding ring.

The court reformed subsection iii.B to “put the parties back in the position that they

would have been in.” Accordingly, the court entered judgment on the docket on June 14,

2024, reforming subsection iii.B to read as follows:

B. The fair market value of the Lake House shall be reduced by the existing

mortgage balance at the time of the buy-out, and then multiplied by 50%.

The remaining sum shall be Wife’s Equity.

(emphasis added). Husband timely noted this appeal.

II.

OVERVIEW OF RELEVANT LAW

“[O]ne of two circumstances must exist before a court of equity will reform a written

contract: either there must be mutual mistake, or there must be fraud, duress, or inequitable

conduct.” Md. Port Admin. v. John W. Brawner Contracting Co., Inc., 303 Md. 44, 59

(1985); Hous. Equity Corp. v. Joyce, 265 Md. 570, 580 (1972) (“Equity will reform a

written document when and only when there is a mutual mistake of fact or a mistake is

made by one of the parties accompanied by fraud, duress or other inequitable conduct

practiced on the person making the mistake by another party . . . .”).

Reformation Based on Mutual Mistake

Mutual mistake exists “where there has been a meeting of the minds—and an

agreement actually entered into, but the instrument, in its written form, does not express

what was intended by the parties thereto.” Moyer v. Title Guarantee Co., 227 Md. 499, 505

(1962). If mutual mistake is proven, then Maryland courts “will reform a written instrument

to make it conform to the real intention of the parties.” Hoffman v. Chapman, 182 Md. 208,

210 (1943); Vincent v. Palmer, 179 Md. 365, 375–76 (1941) (“If both parties have an

identical intention as to the terms to be embodied in a release, and the writing executed by

them is materially at variance with that intention, either party can have the writing reformed

so that it will express the intention of the parties.”). For example, a scrivener’s error or

oversight by the neutral drafter of a written instrument is considered the “mistake of all

parties” and, accordingly, can be the basis to reform an instrument based upon mutual

mistake. See Kishter v. Seven Cts. Cmty. Ass’n, Inc., 96 Md. App. 636, 643 (1993) (“If [the

trial court] finds that the draftsman was the agent for all parties, then the Hoffman holding

makes it clear that the draftsman’s mistake was the ‘mistake of all parties,’ i.e., the mistake

was mutual.” (emphasis added)); Hoffman, 182 Md. at 214 (“Where a deed . . . fails to

express the manifest intention of the parties on account of a mistake of the draftsman,

whether from carelessness, forgetfulness or lack of skill, equity will rectify the mistake to

make the deed express the real intention of the parties.” (emphasis added)).

Reformation Based on Mistake Accompanied by Fraud, Duress, or Other

Inequitable Conduct

A written instrument can also be reformed when “a mistake is made by one of the

parties accompanied by fraud, duress or other inequitable conduct practiced on the person

making the mistake by another party.” Hous. Equity Corp., 265 Md. at 580; see 27 Williston

on Contracts § 70:104, Westlaw (4th ed., May 2026 update) (“Williston”) (“The law

permits reformation of instruments to reflect the true intention of the parties when the error

has arisen by the unilateral mistake of one party and that mistake is accompanied by clear

and convincing evidence of some sort of fraud, deception, or other bad faith activity by

the other party that prevented or hindered the mistaken party in the timely discovery of the

mistake.” (emphases added)). “In effect, the party with knowledge of the mistake is

estopped from relying on the mistake.” Williston § 70:112; accord Gross v. Stone, 173 Md.

653, 666 (1938) (“A court of equity will not permit one party to take advantage of and

enjoy the benefit of an ignorance or mistake of law by the other, which he knew of and did

not correct.” (citation omitted)).

Fraud or other inequitable conduct necessary to justify reformation of a contract

need not involve actual intentional deceit. Hennig v. Ahearn, 601 N.W.2d 14, 26 (Wis. Ct.

App. 1999). Moreover, it is not necessary for inequitable conduct to be “intentionally

misleading, much less that it should be actual fraud.” Gross, 173 Md. at 666 (citation

omitted). It is enough that the “misconception . . . was the result of, or even aided or

accompanied by, incorrect or misleading statements, or acts of the other party.” Id. (citation

omitted); see, e.g., Elling v. Travers, 162 Md. 597, 607 (1932) (“[I]f the appellants executed

the agreement in the mistaken, but honest, belief that its execution did not affect their

remedy against the cab company, and but for such belief they would not have executed it,

and the insurance company knew that to be so, and with that knowledge induced the

execution of the agreement and, against the appellants’ protest, retained its benefits, the

acts of the insurance company might well constitute such inequitable conduct as added to

the mistake of law would justify a court of equity in setting it aside.”).

The Supreme Court of Maryland, citing the Restatement (First) of Contracts, § 505

(1932), explained:

[I]f one party at the time of the execution of a [written agreement] knows that

it does not accurately express the intention of the other party, and also knows

what that intention is, the latter can have the [agreement] reformed so that it

will express that intention.

Vincent, 179 Md. at 376 (emphasis added); accord England v. Universal Fin. Co., 186 Md.

432, 438–39 (1946).

The rule in § 505 of the Restatement (First) of Contracts has been incorporated into

§ 166 of the Restatement (Second) of Contracts (1981), 3 which provides, in relevant part:

If a party’s manifestation of assent is induced by the other party’s fraudulent

misrepresentation as to the contents or effect of a writing evidencing or

embodying in whole or in part an agreement, the court at the request of the

recipient may reform the writing to express the terms of the agreement as

asserted,

(a) if the recipient was justified in relying on the misrepresentation . . . .[ 4]

The Section’s Comment a explains that this rule applies “to the case where only one

party is mistaken and the other, although aware of the mistake, says nothing to correct it.

In that case his non-disclosure is equivalent to an assertion that the writing is as the other

understands it to be.” Id. § 166, cmt. a (emphasis added). Section 166 provides an

illustration based on that in former § 505. See id. § 166, Reporter’s Note. This illustration

is analogous to the circumstances of the instant case:

See Restatement (Second) of Contracts § 166, Reporter’s Note (explaining that § 166 replaces §§ 491 and 505 of the Restatement (First) of Contracts).

“Reformation is not precluded by the mere fact that the party who seeks it failed to exercise reasonable care in reading the writing, but his reliance on the misrepresentation must be justified and the right to reformation is therefore subject to the rule on fault stated in § 172.” Restatement (Second) of Contracts § 166, cmt a. Comment a to § 172 explains, “The recipient’s fault makes [her] reliance unjustified only in extreme cases where [she] has failed to act in good faith and in accordance with reasonable standards of fair dealing.” Id. § 172, cmt. a (emphasis added); see, e.g., id. illus. 1 (“A and B reach an understanding that they will execute a written contract containing terms on which they have agreed. A prepares a writing containing essential terms different from those agreed upon and induces B to sign it by telling him that it contains the agreed terms and that it is not necessary for him to read it. Although B’s apparent manifestation of assent is effective if he had a reasonable opportunity to read the writing, his reliance is justified since his fault does not amount to a failure to act in good faith and in accordance with reasonable standards of fair dealing. The contract is voidable by B. In the alternative he may have the writing reformed.” (emphasis added and citation omitted)). Mr. Brvenik has not asserted any such unjustifiable reliance on the part of Ms. Kavanagh.

4. A, seeking to induce B to make a contract to sell a tract of land to A for

$100,000, makes a written offer to B. A knows that B mistakenly thinks that

the offer contains a provision under which A assumes an existing mortgage

and that it does not contain such a provision, but does not disclose this to B

for fear that B will not accept. B is induced by A’s non-disclosure to sign the

writing, which is an integrated agreement. A’s non-disclosure is equivalent to

an assertion that the writing contains such a provision and amounts to a

fraudulent misrepresentation. At the request of B, the court will reform the

writing to add the provision for assumption.

Id. cmt. a, illus. 4 (citations omitted) (emphases added); accord id. § 161 (“A person’s nondisclosure of a fact known to him is equivalent to an assertion that the fact does not exist . . .

where he knows that disclosure of the fact would correct a mistake of the other party as to

the contents or effect of a writing, evidencing or embodying an agreement in whole or in

part.” (emphasis added)); id. § 161, cmt. e (“One party cannot hold the other to a writing if

he knew that the other was mistaken as to its contents or as to its legal effect. He is expected

to correct such mistakes of the other party and his failure to do so is equivalent to a

misrepresentation, which may be grounds either for avoidance under § 164 or for

reformation under § 166.”); see also id. § 161, cmt. e, illus. 12.

Corbin on Contracts provides a similar articulation of these principles:

[O]ne who knows of another’s mistake and says nothing will find himself

bound by a contract that he did not intend to make. Suppose one party assents

to a writing, being mistaken as to the terms that it contains or as to the

ordinary meaning of the terms, and the other, with knowledge of this mistake,

likewise assents. The language of an agreement will be interpreted according

to the meaning given to it by one party if the other had actual knowledge that

such was the meaning so given. It is certain that such a bad actor will not be

permitted to enforce the agreement according to its words in their usual

meaning. The mistaken party is certainly entitled to avoid the contract but

may, instead, get reformation and enforcement as reformed.

7 Corbin on Contracts § 28.41, LexisNexis (2025) (“Corbin”) (emphases added).

Although the mistake under such circumstances may be a unilateral one, “[a]

mistake by one party with knowledge of that mistake by the other is equivalent to a mutual

mistake.” Williston § 70:112. “[A] mistake by one party, and knowledge of the mistake by

the other, justifies relief as fully as a mutual mistake.” Id.

Standard of Proof

Evidence of mistake must be clear and convincing. Lazenby v. F.P. Asher, Jr. & Sons,

Inc., 266 Md. 679, 683 (1972) (“The authorities all require that the parol evidence of the

mistake and of the alleged modification must be most clear and convincing . . . .” (citation

omitted)). “To be clear and convincing, evidence should be ‘clear’ in the sense that it is

certain, plain to the understanding, and unambiguous and ‘convincing’ in the sense that it

is so reasonable and persuasive as to cause [the factfinder] to believe it.” Maryland Pattern

Jury Instructions-Civil 1:17 (5th ed. 2018).

III.

DISCUSSION

This case implicates a mistake by one of the parties accompanied by fraud or other

inequitable conduct. Mr. Brvenik argues that the circuit court erred in reforming the MSA

on three grounds. First, he contends the court improperly admitted settlement discussions

in violation of Maryland Rule 5-408. Second, he claims the court erred in relying on the

post-divorce fee invoice and asserts that the entries did not show he was aware of counsel’s

mistake in deleting the phrase “reduced by” from subsection iii.B. Finally, he argues the

court erred in reforming subsection iii.B based on a finding of mutual mistake. We address

each argument seriatim.

Maryland Rule 5-408

As a general common law rule, parol evidence is inadmissible to vary or contradict

the terms of a written instrument. Hoffman, 182 Md. at 210. However, “equity refuses to

enforce this rule 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. Mr.

Brvenik does not dispute that parol evidence is admissible where there is a claim of

mistake. Instead, he contends that testimony and other evidence about the deletion of the

phrase “reduced by” were settlement discussions, and the court admitted the evidence in

violation of Maryland Rule 5-408. We disagree.

Rule 5-408 provides,

(a) The following evidence is not admissible to prove the validity, invalidity,

or amount of a civil claim in dispute:

(1) Furnishing or offering or promising to furnish a valuable

consideration for the purpose of compromising or attempting to

compromise the claim or any other claim;

(2) Accepting or offering to accept such consideration for that purpose;

and

(3) Conduct or statements made in compromise negotiations or

mediation.

(b) This Rule does not require the exclusion of any evidence otherwise

obtained merely because it is also presented in the course of compromise

negotiations or mediation.

section (a) of this Rule is not excluded under this Rule when offered for

another purpose, such as proving bias or prejudice of a witness,

controverting a defense of laches or limitations, establishing the existence of

a “Mary Carter” agreement, or proving an effort to obstruct a criminal

investigation or prosecution, but exclusion is required where the sole purpose

for offering the evidence is to impeach a party by showing a prior

inconsistent statement.

(d) When an act giving rise to criminal liability would also result in civil

liability, evidence that would be inadmissible in a civil action is also

inadmissible in a criminal action based on that act.

(emphases added).

“The purpose of Rule 5-408 is to encourage the settlement of lawsuits by ensuring

that parties need not fear that their desire to settle pending litigation and their offers to do

so will be construed as admissions.” Bittinger v. CSX Transp. Inc., 176 Md. App. 262, 276–

77 (2007). “The admission of evidence is committed to the considerable and sound

discretion of the trial court and will not be disturbed in the absence of abuse of that

discretion.” Bos. Sci. Corp. v. Mirowski Fam. Ventures, LLC, 227 Md. App. 177, 201 (2016)

(citation modified).

Although the court treated some of the disputed evidence as not being settlement

discussions, we will assume arguendo that they are. The court did not abuse its discretion

in admitting such evidence. Ms. Kavanagh did not seek to admit the evidence to prove the

validity or invalidity of a claim. Instead, she was offering the evidence “for another

purpose.” 5 Specifically, Ms. Kavanagh was offering it to show that the deletion of “reduced

The Rule lists examples of “another purpose,” but that list is not exhaustive. Cf. Fed. R. Evid. 408 (from which the Maryland Rule is derived); see United States v. Technic Servs., Inc., 314 F.3d 1031, 1045 (9th Cir. 2002) (explaining that, under FRE 408, “[t]he use of the phrase ‘such as’ implies that the ensuing list is not exhaustive, but is only

by” in subsection iii.B was a mistake. See Bittinger, 176 Md. App. at 277 (explaining that

Rule 5-408 was plainly not applicable “because the evidence at issue concerned previously

settled claims and not promises to settle an existing claim”); Bennett v. Ashcraft & Gerel,

LLP, 259 Md. App. 403, 449, n.19 (2023) (explaining that the Rule did not apply because

the statements made during settlement negotiations were not used “to prove the validity,

invalidity, or amount of” the civil claim, but instead for some other purpose).

Mr. Brvenik relies on Berg v. Berg, 151 N.E.3d 321 (Ind. Ct. App. 2020), vacated,

170 N.E.3d 224 (Ind. 2021), 6 to support his argument that such evidence was inadmissible.

There, following the entry of a marital settlement agreement, the wife sought to avoid the

agreement on the basis that, due to her attorney’s mistaken omission of one of the husband’s

stock accounts, the parties relied on an incomplete marital balance sheet during mediation.

Id. at 324. To prove that the balance sheet was incomplete, the wife offered evidence of

what had transpired at mediation, namely, (1) two purported marital balance sheets

illustrative”), overruled on other grounds, United States v. Contreras, 593 F.3d 1135 (9th Cir. 2010) (en banc); Lo Bosco v. Kure Eng’g Ltd., 891 F. Supp. 1035, 1039 (D.N.J. 1995) (stating plaintiff’s notion that listing of exceptions in Rule 408 is exclusive is so “clearly false” it required no further comment).

The Supreme Court of Indiana vacated the intermediate appellate court’s opinion pursuant to Indiana Rule of Appellate Procedure 58(A), which provides that, subject to certain exceptions, the opinion of the intermediate appellate court is automatically vacated when the Supreme Court grants a petition to transfer, as it did in this case. See Berg v. Berg, 170 N.E.3d 224, 227 (Ind. 2021). Under Indiana law, reliance on a vacated opinion is “improper” because it lacks precedential value. See Grubnich v. Renner, 746 N.E.2d 111, 116 (Ind. Ct. App. 2001); Meyer v. Biedron, 667 N.E.2d 752, 753 (Ind. 1996) (noting that court of appeals’s opinion was vacated by grant of transfer and thus had no precedential value). We note, however, that the Supreme Court of Indiana ultimately held, as the intermediate appellate court did, that the wife’s evidence was inadmissible under Indiana Evidence Rule 408. Berg, 170 N.E.3d at 229–30.

prepared by her counsel prior to mediation; and (2) an affidavit averring that she was not

aware of the mistake during mediation and, if she had been, she would not have entered

the agreement. Id. at 324–25. The husband moved to strike, arguing that the evidence was

inadmissible because it was “information that was discussed and done during mediation.”

Id. at 325. Ultimately, the trial court found that “fraud, constructive fraud, mutual mistake,

or misrepresentation had occurred,” denied the motion to strike, and awarded half of the

value of the missing account to the wife. Id.

On appeal, the Court of Appeals of Indiana explained that mediation did, indeed,

constitute settlement negotiations governed by Indiana Evidence Rule 408, which, like

Maryland Rule 5-408, generally excludes evidence of conduct or statements made during

settlement negotiations. Id. at 326. However, the Court of Appeals explained that the Rule

408(b) exception, which permits such evidence to be admitted “for another purpose,”

allows evidence to be used “in collateral matters unrelated to the dispute that is the subject

of the mediation.” Id. at 327 (citation omitted). It held that the evidence the wife sought to

admit was inadmissible to show “why [she] agreed to the disposition of assets in the

Settlement Agreement,” which was a “non-collateral purpose.” Id. at 329; see also Horner

v. Carter, 981 N.E.2d 1210, 1212–13 (Ind. 2013) (explaining that statements made during

mediation were inadmissible to prove what the parties meant by an ambiguous provision

in the mediated agreement, which was not collateral to the mediation); but see Gast v. Hall,

858 N.E.2d 154, 161–62 (Ind. Ct. App. 2006) (deeming a person’s unusual statements

during mediation as admissible under Rule 408(b) to show the person lacked testamentary

capacity, which was collateral to the mediated dispute).

Mr. Brvenik’s reliance on Berg is unavailing. To the extent that the Court of Appeals

of Indiana’s vacated opinion has any precedential value, see supra n.5, the Court of Appeals

noted that Indiana courts seem to exclude more evidence than other courts typically do

under the analogous Federal Rule of Evidence 408, from which Maryland Rule 5-408 is

derived. See Berg, 151 N.E.3d at 328 n.6 (“It seems that this policy preference animates

Indiana Evidence Rule 408, mandating the exclusion of more evidence than our sister

courts would exclude under the substantially similar federal rule.”); id. (comparing Indiana

courts’ restrictive application of the rule with Coakley & Williams Constr., Inc. v. Structural

Concrete Equip., Inc., 973 F.2d 349, 353–54 (4th Cir. 1992), in which the Fourth Circuit

“determined that a settlement offer could be admitted to resolve ambiguity, reasoning that

the evidence was not offered to prove liability or damages but instead ‘offer[ed] as evidence

of the parties’ intent’ in entering the non-mediated settlement agreement”).

More importantly, Mr. Brvenik overlooks another Indiana case, Thomas v. Thomas,

674 N.E.2d 23 (Ind. Ct. App. 1996), which reached a different result that applies to the

instant case. In Thomas, the ex-wife moved to modify an agreed dissolution decree based

on an alleged clerical error in the decree requiring her to pay her ex-husband $15,500 in

one paragraph and $23,500 in another paragraph. 674 N.E.2d at 24–25. She introduced

exhibits she claimed were prepared to assist her attorney in drafting the decrees and

purported to demonstrate the parties’ clerical error. Id. at 26. The court admitted the exhibits

over the ex-husband’s objection that their admission violated Indiana Rule 408. Id. The

Court of Appeals of Indiana held that the evidence was admissible because it was offered

for “another purpose.” Id. It explained:

Here, we find that the exhibits were not offered to show liability or invalidity

of a claim, but to show the mistake in drafting the final agreed decree of

dissolution. Because the exhibits were offered for the purpose of

demonstrating mistake, the exhibits are not excludable under the rule. In

addition, the exhibits were relevant to demonstrate the parties’ mistake in

drafting the agreed decree and to show that the final decree was contrary to

the parties’ intent.

Id. (emphasis added). Likewise, Ms. Kavanagh offered the evidence “for another purpose,”

i.e., demonstrating that the deletion of “reduced by” in subsection iii.B was a mistake. For

the reasons stated, the court did not err in admitting evidence of any settlement discussions

to show mistake.

Post-Divorce Fee Invoice

Mr. Brvenik argues that the circuit court clearly erred in finding that his new

attorney’s post-divorce research into mutual mistake demonstrated his knowledge of a

clerical error in subsection iii.B before signing the MSA. He contends that a billing entry

made after the MSA’s execution does not prove he was aware of the error beforehand.

According to Mr. Brvenik, the court could not determine from the billing reference to

“mutual mistake” whether he recognized the drafting error made by Ms. Kavanagh’s

attorney before signing, or if he discovered the error afterward and brought it to the

attention of counsel, who then identified a potential issue of unilateral or mutual mistake.

Because the trial below was a non-jury trial, our standard of review is governed by

Maryland Rule 8-131. That rule provides that this Court “will not set aside the judgment

of the trial court on the evidence unless clearly erroneous, and will give due regard to the

opportunity of the trial court to judge the credibility of the witnesses.” Md. Rule 8-131(c).

“A finding of a trial court is not clearly erroneous if there is competent or material evidence

in the record to support the court’s conclusion.” Lemley v. Lemley, 109 Md. App. 620, 628

(1996).

Moreover, “[u]nder the clearly erroneous standard, this Court does not sit as a

second trial court, reviewing all the facts to determine whether an appellant has proven his

case.” Id. “Nor is it our function to weigh conflicting evidence.” Liberty Mut. Ins. Co. v.

Md. Auto. Ins. Fund, 154 Md. App. 604, 609 (2004). “Our task is limited to deciding

whether the circuit court’s factual findings were supported by ‘substantial evidence’ in the

record.” Id. In doing so, we must view all the evidence in a light most favorable to the

prevailing party. Id.

The court did not clearly err in finding that Mr. Brvenik knew of the mistake before

executing the MSA based in part on the entries in the fee invoice. The evidence established

that Mr. Brvenik knew before signing the MSA that Ms. Kavanagh’s attorney removed the

phrase “reduced by” during the final round of proposed revisions, and that he was fully

aware that without it, subsection iii.B would mean that the fair market value of the lake

house equaled the mortgage balance at the time of the buyout. Although he claimed he

believed Ms. Kavanagh intended this deletion as a concession in light of the many benefits

she received under the MSA, the court did not find his testimony credible, particularly

given his conduct following the execution of the MSA.

A mere nine days after the parties executed the MSA, Mr. Brvenik retained new

counsel to address a “potential post-judgment matter.” He claimed that a possible dispute

over a wedding ring prompted this action. However, when questioned during cross21

examination about whether he actually wanted the firm to investigate the mistake in

subsection iii.B, Mr. Brvenik was reticent:

[COUNSEL FOR MS. KAVANAGH]: [Y]ou hired someone at [the law firm]

at $355.00 an hour to research the standard for mistake in an agreement and

the [c]ourt’s authority to amend a signed MSA, correct?

[MR. BRVENIK]: If that’s what it states.

[COUNSEL FOR MS. KAVANAGH]: And then there’s also amended

research on mistake to include additional research on the [c]ourt’s definition

of mutual mistake.

[MR. BRVENIK]: That’s what it states.

[COUNSEL FOR MS. KAVANAGH]: What did you expect Ms. Kavanagh

to want to revise regarding the wedding ring?

[MR. BRVENIK]: I didn’t expect, I wanted a review to understand what

exposures there might be.

[COUNSEL FOR MS. KAVANAGH]: Well what would the [c]ourt’s

definition of mutual mistake have to do with that?

[MR. BRVENIK]: I’m not an attorney, I asked for a review. How they chose

to review is what they do.

[COUNSEL FOR MS. KAVANAGH]: Okay. And did you want to or were

you considering that [Ms. Kavanagh] might want to revise the signed MSA

about the wedding ring?

[MR. BRVENIK]: I asked for a review.

[COUNSEL FOR MS. KAVANAGH]: Is it your testimony that you did not

go to them to get an opinion on the language involving the fair market value

of the property equaling the mortgage balance?

[MR. BRVENIK]: It’s my testimony that I went to them for review of the

[MSA], and the impet[]us for that review was a debate over the wedding ring.

The court explicitly stated it did not find Mr. Brvenik credible. Weighing the

evidence, including the entries in the invoice as part of the overall assessment, the court

found that he knew the deletion of “reduced by” was a mistake before the parties executed

the MSA. Once evidence is admitted—as the fee invoice was here without objection—the

fact finder is entitled to give it “whatever weight it deems appropriate in its prerogative.”

Jacobs v. State, 45 Md. App. 634, 653 (1980). Specifically, the court was entitled to

consider evidence arising after the MSA’s execution to infer Mr. Brvenik’s knowledge or

state of mind prior to signing. See, e.g., Tufts v. Poore, 219 Md. 1, 10 (1959) (noting that

“[a] fraudulent pre-existing intent . . . . may be considered with the subsequent conduct” of

the bad actor and “the other circumstances surrounding the transaction in sustaining such

an inference”); Chow v. State, 393 Md. 431, 473 (2006) (explaining that mens rea may be

proven by surrounding circumstances); Graham v. State, 117 Md. App. 280, 284 (1997)

(“In determining the intent of the defendant, the trier of fact is permitted to infer the

requisite intent from the surrounding circumstances.”). For the reasons stated, the court did

not clearly err when it found that Mr. Brvenik knew that the deletion of “reduced by” was

a mistake before signing the MSA based on the entries in his post-divorce fee invoice.

Reformation

Mr. Brvenik argues that the circuit court erred in reforming the MSA based on a

finding of mutual mistake; his knowledge of counsel’s mistake does not convert it into a

mutual mistake. Under the circumstances here, the distinction between unilateral and

mutual mistake is immaterial because reformation is justified by a unilateral mistake

accompanied by fraud or inequitable conduct by the unmistaken party. See Md. Port

Admin., 303 Md. at 58. As stated earlier, “[a] mistake by one party with knowledge of that

mistake by the other is equivalent to a mutual mistake.” Williston § 70:112 (emphasis

added). “[A] mistake by one party, and knowledge of the mistake by the other, justifies

relief as fully as a mutual mistake.” Id. (emphasis added).

While it is true that Ms. Kavanagh’s attorney inadvertently deleted the words

“reduced by” and acknowledged it was her mistake, the court found that Mr. Brvenik was

aware of the deletion and did not disclose it before signing the MSA. This non-disclosure

constitutes, at a minimum, inequitable conduct, which the court implied in its oral ruling

and equated to a “mutual mistake.” Therefore, the court did not err in concluding that the

circumstances justified the reformation of subsection iii.B “as fully as a mutual mistake.”

Williston § 70:112.

Decisions by courts in other jurisdictions are in accord. See Tatonka Cap. Corp. v.

Connelly, 390 F. Supp. 3d 1289, 1304 (D. Colo. 2019) (“Tatonka’s silence and refusal to

correct Mr. Connelly’s misunderstanding constitutes a misrepresentation to Mr. Connelly

about the effect of the [] Agreements under Restatement Section 161 and illustration 12.”);

425 Beecher, L.L.C. v. Unizan Bank, Nat’l Ass’n, 927 N.E.2d 46, 57–58 (Ohio Ct. App.

2010) (determining that the trial court did not err in ordering reformation based on the

bank’s unilateral drafting mistake where the other party knew the bank’s intent and said

nothing); NOLM, LLC v. Cnty. of Clark, 100 P.3d 658, 662–63 (Nev. 2004) (explaining that

where county intended to sell only remnant parcels, not entire parcels, and other party knew

about the misdescription in the contract and failed to bring it to county’s attention,

reformation of the contract to describe remnant parcels instead of entire parcels based on

unilateral mistake was appropriate); Traggis v. Shawmut Bank Conn., N.A., 805 A.2d 105,

112–13 (Conn. App. Ct. 2002) (concluding the trial court did not err in ordering

reformation where the closing date suggested by defendant was the result of typographical

error, plaintiff knew defendant’s intended closing date, and plaintiff failed to inform

defendant of its mistake in the hopes of extending contractual deadline); Belk v. Martin, 39

P.3d 592, 599 (Idaho 2001) (holding the trial court “did not err by reforming the lease that

contained a unilateral mistake of which Martin had knowledge”); Cambridge Cos., Inc. v.

Williams, 602 S.W.2d 306, 309 (Tex. Ct. App. 1980) (concluding defendant’s knowledge

of and failure to disclose mistake in commission note during negotiations justified

reformation of the note); Webb v. Culver, 509 P.2d 1173, 1174–75 (Or. 1973) (en banc)

(determining the trial court did not err in reforming contract in plaintiffs’ favor by adding

to the legal description a four-foot strip of land between the original boundary line and

fence line, given that defendant’s initial conduct in constructing fence and developing other

parts of the property led plaintiffs to mistakenly believe the fence marked the eastern

boundary of their property and defendant did not assert otherwise until five years after

sale). For the reasons stated, the court did not err in reforming subsection iii.B of the MSA.

Alternatively, Mr. Brvenik argues that the court could not reform the subsection

without knowing whether he would have accepted a counteroffer that retained the words

“reduced by” but deleted the phrase “a) five percent (5%) of the fair market value of the

Lake House,” a clause he had previously requested. In other words, he claims the reformed

language does not reflect his intended agreement, and that the court reformed the contract

without knowing if he would have agreed to remove the 5% reduction clause.

We are not persuaded. The claim that Mr. Brvenik may never have intended to enter

into the MSA as reformed is immaterial. This is because his “non-disclosure” of a known

mistake was “equivalent to an assertion that the writing [was] as [Ms. Kavanagh]

underst[ood] it to be,” Restatement (Second) of Contracts § 166—i.e., an agreement that

the phrase “reduced by” was included in the provision calculating her equity in the lake

house; accord Corbin § 28.41 (“The language of an agreement will be interpreted according

to the meaning given to it by one party if the other had actual knowledge that such was the

meaning so given.”). As Corbin explains,

The conduct of the other party in permitting the first to execute the erroneous

writing and later attempting to enforce it may be regarded as fraudulent; but

it is enough to justify reformation that he knows the terms proposed by the

first party and the meaning thereof and leads that party to reasonably believe

that he too assents to those terms. This makes a contract; and the writing may

be reformed to accord with it.

Corbin § 28.45 (emphasis added); accord Stare v. Tate, 98 Cal. Rptr. 264, 268–69 (Cal. Ct.

App. 1971) (quoting Corbin and stating that where the wife’s attorney negligently

undervalued the equity in real property and the husband’s attorney discovered but failed to

disclose the error, the husband’s assertion that he never assented to the different value was

“immaterial”); Hand v. Dayton-Hudson, 775 F.2d 757, 760–61 (6th Cir. 1985) (rejecting

the argument that a meeting of the minds is required for reformation under § 166 of the

Restatement (Second) of Contracts because the rule is “designed primarily to combat the

inequities which naturally result from the fraudulent inducement of an innocent party to

sign a contract the guilty party knew did not reflect the other party’s intent”); see also Line

Lexington Lumber & Millwork Co. v. Pa. Publ’g Corp., 301 A.2d 684, 687–88 (Pa. 1973)

(“[A] party who knowingly causes a written instrument to fail to embody the intent of the

other party is estopped from relying on such defect in the instrument. Moreover, where the

first party knows what the other party actually intended, the instrument will be reformed

to conform to that intention.” (emphasis added)).

Finally, Mr. Brvenik contends that the court did not explicitly “announce” that it

was applying the clear and convincing evidence standard. To the extent he claims the court

must state the applicable standard of proof on the record, he provides no legal authority to

support this argument. “Absent an indication to the contrary, we must assume that judges

apply the law correctly to the case before them.” Hebb v. State, 31 Md. App. 493, 499

(1976). “Even when the record is silent as to the standard of proof applied by the judge,

that does not suggest that the judge applied the incorrect law or made a mistake.” Bailey v.

Happer, 268 Md. App. 618, 638–39 (2026). There is no indication in the record that the

court applied the wrong standard.

For the reasons stated, we affirm the judgment of the circuit court. 76F

JUDGMENT OF THE CIRCUIT COURT

FOR HOWARD COUNTY AFFIRMED.

COSTS TO BE PAID BY THE APPELLANT.

The judgment of absolute divorce entered on July 20, 2023, provides that the MSA dated July 12, 2023 “is hereby approved and made a part of and incorporated in this Judgment, but not merged therein, having the same force and effect as if fully set forth herein[.]” In their briefs, the parties did not raise or address how the circuit court’s reformation of the MSA impacts the judgment of absolute divorce. Accordingly, we do not address this issue.

Brvenik v. Kavanagh

Authorities cited

Opinion · public domain