OH!!! I would be soooooooooo upset!!! Have you asked them what they were thinking? I seriously doubt I'd ever, EVER forget a name my family member told me they would use, but maybe there's a slim chance that she figured since you had a girl, you didn't use that name, not considering you'd have a boy next time perhaps and still want to use the name Max?
Or do you think she has a little bit of hostility since she miscarried and you didn't? If so, that's some major passive agressive behavior!
If I were you, I'd try talking to her (or maybe your brother) and see if they will considering changing the dog's name. How long has the dog had this name? ...Cause you know if you use the name Max and the dog is still named Max, then everyone will say, "You mean like SIL's dog???"
Oooohhh, now here's an idea! What if you stay with your plans of Max, name the baby Max, and when people ask you why you named your baby Max since their dog is named Max, you can say (without sounding like you're holding a grudge) "Max was a name we had picked out before Katie was born, if we had a boy. I'm not sure why they named their dog Max; SIL knew that was the name I would use for a boy." And theeeeeennn maybe someone else will suggest she change the dog's name. Or maybe the family will start a new name for the dog.
like Cracks the dog. :LOL It rhymes, the dog wouldn't konw the difference. Jax, SOMETHING!! Just not Max!!!