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I was able to duplicate your problem, thanks to the document you provided. First, I'll describe how the problem was probably created, and then offer a solution.
The problem originated when the default font was created, and then the wrong steps were done in an attempt to remove the Small caps. To create the problem perform the following steps:
- Open a new blank document.
- In the Font group under the Home tab on the Word ribbon, open the Font dialog box, and place a checkmark next to Small caps. Then click the Set as Default Button. If you are asked whether you want to set the default font to the current document or the Normal template, choose the current document.
- Open the Font dialog box again, and remove the checkmark next to the Small caps, but this time click OK.
- Type some text using the Normal style. Select the text and right click on the Normal style in the style gallery, and click on Update Normal to Match Selection.
- Open the Styles pane by clicking on the tiny arrow in the Styles group. Scroll down until you see the Hyperlink style. (You may need to make it visible using the Options button.) Right click on Hyperlink style and choose Modify. You'll notice its preview shows Small caps, but its description does not.
- With the Modify Style dialog box still open, click the Format button and chose Font. Remove the checkmarks from both Small caps and All caps, and click OK. You'll notice the preview now matches the description.
- Click OK again to close the dialog box.
- Now, type some more text using the Normal style, select the text, and click on Add a hyperlink under the Links group under the Insert tab on the ribbon. You'll see the link is displayed in Small Caps.
I believe the reason this is happening is because the Hyperlink style is a character style, and it is based on the Default Paragraph Font (or the underlying properties) which in this case was set to Small caps when Step 2 was performed. When you removed the checkmarks in the Hyperlink style, it inherited the default settings.
To solve the problem, perform the following steps:
- Type some text using the Normal style, and select the text.
- Go back to the Font group on the ribbon, open the Font dialog box, and make sure there is no checkmark next to Small caps. Then click the Set as Default Button. If you are asked whether you want to set the default font to the current document or the Normal template, choose the current document again.
- Type some text and add a hyperlink to the text. (It will still display in Small caps.)
- Open the Styles pane again, and right click on the Hyperlink style, and choose Modify.
- Click on the Format button, and choose Font. Remove the checkmark next to Small caps, and click OK. You'll now notice the preview still matches the description.
- Click OK to close the dialog box.
Now all the hyperlinks that were previously created with Small caps are no longer Small caps, and when you create any additional hyperlinks, they too will not be in Small caps.