Diana bought a new Apple iPhone 5. The Apple store employee merged her contacts, but every contact in her phone was from iCloud and not her personal contacts. Leo says that's probably true. He assumed that Diana's phone was backed up, and it wasn't. Going forward, Diana should continue to backup to iCloud so if she loses her phone, she'll still have her contacts. She should just clean it up first. Then back up her contacts to the Cloud and have it continue to backup regularly. She can log into iCloud.com to see and modify her contacts from there. But doing it from the desktop will be much easier. The scary thing to do though, is to delete her contacts everywhere except iCloud and then let iCloud propagate it to her other platforms.
What about her husband's contacts? Leo says to create two separate Apple accounts and they'll both have separate, synced accounts in the cloud. Leo also recommends setting up a Google account and sync the contacts up there. Then they can turn off the iCloud contact sync and sync through Google. Google also has a de-duplicator to get rid of duplicate entries. Google is way better at syncing to the cloud than Apple is.