diff --git a/packages/shared/src/validators/text.test.ts b/packages/shared/src/validators/text.test.ts
new file mode 100644
index 00000000000..ee30f51d8db
--- /dev/null
+++ b/packages/shared/src/validators/text.test.ts
@@ -0,0 +1,78 @@
+import { describe, expect, it } from "vitest";
+import {
+  multilineTextSchema,
+  normalizeEscapedLineBreaks,
+  normalizeMarkdownBody,
+  normalizeMidLineHeadings,
+} from "./text.js";
+
+describe("normalizeEscapedLineBreaks", () => {
+  it("converts JSON-escaped line breaks to real newlines", () => {
+    expect(normalizeEscapedLineBreaks("a\\nb\\r\\nc\\rd")).toBe("a\nb\nc\nd");
+  });
+});
+
+describe("normalizeMidLineHeadings", () => {
+  it("inserts a break before a mid-line ATX heading marker", () => {
+    expect(normalizeMidLineHeadings("plan pack)## The goal")).toBe("plan pack)\n\n## The goal");
+  });
+
+  it("heals every mid-line heading in a collapsed single-line body", () => {
+    const collapsed = "# Plan pack ## The goal, restated ### You picked";
+    expect(normalizeMidLineHeadings(collapsed)).toBe(
+      "# Plan pack \n\n## The goal, restated \n\n### You picked",
+    );
+  });
+
+  it("leaves a heading that is already at the start of a line alone", () => {
+    const body = "## The goal\n\nYou picked the shared plan pack.";
+    expect(normalizeMidLineHeadings(body)).toBe(body);
+  });
+
+  it("leaves a leading heading at the start of the body alone", () => {
+    expect(normalizeMidLineHeadings("# Title here")).toBe("# Title here");
+  });
+
+  it("does not touch inline `#` tokens like C# and F#", () => {
+    const body = "We ship both C# and F# services this quarter.";
+    expect(normalizeMidLineHeadings(body)).toBe(body);
+  });
+
+  it("does not touch a `#` glued to a following non-space (hashtags, issue refs)", () => {
+    const body = "See #123 and #roadmap for the plan.";
+    expect(normalizeMidLineHeadings(body)).toBe(body);
+  });
+
+  it("heals a two-hash marker even when preceded by a word char", () => {
+    expect(normalizeMidLineHeadings("restated## The goal")).toBe("restated\n\n## The goal");
+  });
+
+  it("ignores runs of 7+ hashes (not a valid heading)", () => {
+    const body = "border ####### divider";
+    expect(normalizeMidLineHeadings(body)).toBe(body);
+  });
+
+  it("does not rewrite `## ` comments inside fenced code blocks", () => {
+    const body = "```yaml\nfoo: bar ## inline comment\n```";
+    expect(normalizeMidLineHeadings(body)).toBe(body);
+  });
+
+  it("is a no-op when there is no `#` at all", () => {
+    const body = "Just some prose with no markers.";
+    expect(normalizeMidLineHeadings(body)).toBe(body);
+  });
+});
+
+describe("normalizeMarkdownBody / multilineTextSchema", () => {
+  it("runs escaped-break normalization before heading healing", () => {
+    // Producer sends JSON-escaped newlines plus a mid-line heading.
+    expect(normalizeMarkdownBody("Intro.\\n\\n## Section body)## Next")).toBe(
+      "Intro.\n\n## Section body)\n\n## Next",
+    );
+  });
+
+  it("multilineTextSchema self-heals a collapsed plan body on write", () => {
+    const parsed = multilineTextSchema.parse("plan pack)## The goal, restated");
+    expect(parsed).toBe("plan pack)\n\n## The goal, restated");
+  });
+});
diff --git a/packages/shared/src/validators/text.ts b/packages/shared/src/validators/text.ts
index 322597a9005..e00eade1155 100644
--- a/packages/shared/src/validators/text.ts
+++ b/packages/shared/src/validators/text.ts
@@ -7,4 +7,64 @@ export function normalizeEscapedLineBreaks(value: string): string {
     .replace(/\\r/g, "\n");
 }
 
-export const multilineTextSchema = z.string().transform(normalizeEscapedLineBreaks);
+const FENCE_LINE = /^(\s{0,3})(```+|~~~+)/;
+// A mid-line ATX heading marker: 1–6 `#`, a space, then heading text. The
+// capture keeps the char immediately before the run so we can tell a real
+// (collapsed) heading from an inline `#` token like `C#`/`F#`.
+const MID_LINE_HEADING = /([^\n#])(#{1,6})([ \t])/g;
+
+/**
+ * Heal a single line that carries an ATX heading marker mid-line. A plan/doc
+ * body whose paragraph and heading newlines were collapsed to a single line
+ * (a producer bug) renders as one giant heading with `##` markers
+ * showing inline (e.g. "…plan pack)## The goal, restatedYou picked…"). Insert a
+ * hard paragraph break before each such marker so the body self-heals into
+ * headings + paragraphs.
+ *
+ * A lone `#` fused to an alphanumeric on its left (`C#`, `F#`, `A#`) is left
+ * alone — that is an inline token, not a heading. Markers with 2–6 hashes are
+ * always healed: `word## ` never occurs as legitimate inline prose.
+ */
+function healMidLineHeadings(line: string): string {
+  return line.replace(MID_LINE_HEADING, (match, before: string, hashes: string, space: string) => {
+    if (hashes.length === 1 && /[A-Za-z0-9]/.test(before)) return match;
+    return `${before}\n\n${hashes}${space}`;
+  });
+}
+
+/**
+ * Defense-in-depth for the Plan pane: insert a paragraph break before
+ * ATX heading markers that appear mid-line, so a malformed single-line markdown
+ * body still renders as headings/paragraphs. Fenced code blocks are skipped so
+ * inline `## ` comments inside code (YAML, shell, diffs) are never rewritten.
+ */
+export function normalizeMidLineHeadings(value: string): string {
+  if (!value.includes("#")) return value;
+  const lines = value.split("\n");
+  let inFence = false;
+  let fenceChar = "";
+  const out: string[] = [];
+  for (const line of lines) {
+    const fenceMatch = FENCE_LINE.exec(line);
+    if (fenceMatch) {
+      const marker = fenceMatch[2]!;
+      if (!inFence) {
+        inFence = true;
+        fenceChar = marker[0]!;
+      } else if (marker[0] === fenceChar) {
+        inFence = false;
+        fenceChar = "";
+      }
+      out.push(line);
+      continue;
+    }
+    out.push(inFence ? line : healMidLineHeadings(line));
+  }
+  return out.join("\n");
+}
+
+export function normalizeMarkdownBody(value: string): string {
+  return normalizeMidLineHeadings(normalizeEscapedLineBreaks(value));
+}
+
+export const multilineTextSchema = z.string().transform(normalizeMarkdownBody);
diff --git a/server/src/onboarding-assets/ceo/AGENTS.md b/server/src/onboarding-assets/ceo/AGENTS.md
index 6e09de67f39..d2ba87b1db5 100644
--- a/server/src/onboarding-assets/ceo/AGENTS.md
+++ b/server/src/onboarding-assets/ceo/AGENTS.md
@@ -35,7 +35,7 @@ You MUST delegate work rather than doing it yourself. When a task is assigned to
 - Use child issues for delegated work and wait for Paperclip wake events or comments instead of polling agents, sessions, or processes in a loop.
 - Create child issues directly when ownership and scope are clear. Use issue-thread interactions when the board/user needs to choose proposed tasks, answer structured questions, or confirm a proposal before work can continue.
 - Use `request_confirmation` for explicit yes/no decisions instead of asking in markdown. Before presenting a plan for review, you MUST complete this publish contract:
-  1. `PUT /issues/{id}/documents/plan` with `{ format: 'markdown', body, changeSummary }`.
+  1. `PUT /issues/{id}/documents/plan` with `{ format: 'markdown', body, changeSummary }`. The `body` renders as markdown: put every heading on its own line and separate blocks with a blank line (`\n\n` in JSON) — never glue headings and paragraphs onto one line.
   2. Re-`GET /documents/plan`, assert it returns `200`, and capture its `latestRevisionId`.
   3. Only then create `request_confirmation` with `target={ type: 'issue_document', key: 'plan', revisionId: latestRevisionId }` and `idempotencyKey=confirmation:{issueId}:plan:{revisionId}`.
   4. Put the source issue in `in_review` and wait for acceptance before delegating implementation subtasks.
diff --git a/server/src/onboarding-assets/default/AGENTS.md b/server/src/onboarding-assets/default/AGENTS.md
index a462c8c9d8c..98bf4762113 100644
--- a/server/src/onboarding-assets/default/AGENTS.md
+++ b/server/src/onboarding-assets/default/AGENTS.md
@@ -12,7 +12,7 @@ You are an agent at Paperclip company.
 - Use child issues for parallel or long delegated work instead of polling agents, sessions, or processes.
 - Create child issues directly when you know what needs to be done. If the board/user needs to choose suggested tasks, answer structured questions, or confirm a proposal first, create an issue-thread interaction on the current issue with `POST /api/issues/{issueId}/interactions` using `kind: "suggest_tasks"`, `kind: "ask_user_questions"`, or `kind: "request_confirmation"`.
 - Use `request_confirmation` instead of asking for yes/no decisions in markdown. Before presenting a plan for review, you MUST complete this publish contract:
-  1. `PUT /issues/{id}/documents/plan` with `{ format: 'markdown', body, changeSummary }`.
+  1. `PUT /issues/{id}/documents/plan` with `{ format: 'markdown', body, changeSummary }`. The `body` renders as markdown: put every heading on its own line and separate blocks with a blank line (`\n\n` in JSON) — never glue headings and paragraphs onto one line.
   2. Re-`GET /documents/plan`, assert it returns `200`, and capture its `latestRevisionId`.
   3. Only then create `request_confirmation` with `target={ type: 'issue_document', key: 'plan', revisionId: latestRevisionId }` and `idempotencyKey=confirmation:{issueId}:plan:{revisionId}`.
   4. Wait for acceptance before creating implementation subtasks.
diff --git a/skills/paperclip/SKILL.md b/skills/paperclip/SKILL.md
index 981afa05f26..2839ef82630 100644
--- a/skills/paperclip/SKILL.md
+++ b/skills/paperclip/SKILL.md
@@ -563,6 +563,8 @@ When asked to convert a plan into executable Paperclip tasks — depth, assignme
 
 When asked to convert a plan into executable Paperclip tasks — depth, assignment, dependencies, parallelization — use the companion skill `paperclip-converting-plans-to-tasks`.
 
+**Formatting matters.** The `body` is rendered as markdown in the Plan pane. Every heading (`#`, `##`, …) must start its own line, and paragraphs must be separated by a blank line. In JSON that means real paragraph breaks encoded as `\n\n` between blocks — never run headings and paragraphs together on a single line. A body like `"# Plan ## Goal You picked…"` (headings glued mid-line) renders as one giant H1 with literal `##` markers showing inline. When you build the request from a heredoc, encode the body with a JSON-safe tool (e.g. `jq -Rs .`) so real newlines are preserved rather than stripped.
+
 Recommended API flow:
 
 ```bash
@@ -570,11 +572,13 @@ PUT /api/issues/{issueId}/documents/plan
 {
   "title": "Plan",
   "format": "markdown",
-  "body": "# Plan\n\n[your plan here]",
+  "body": "# Plan\n\n## Goal\n\n[one paragraph per idea, blank line between blocks]\n\n## Approach\n\n- step one\n- step two",
   "baseRevisionId": null
 }
 ```
 
+Note how each heading (`# Plan`, `## Goal`, `## Approach`) is separated from the surrounding text by `\n\n`. Keep that structure — a defense-in-depth guard on the write path will insert a break before a stray mid-line heading marker, but author the newlines correctly rather than relying on it.
+
 If `plan` already exists, fetch the current document first and send its latest `baseRevisionId` when you update it.
 
 ## Key Endpoints (Hot Routes)