Mary E. Marlowe v. IDS Property Casualty Insurance Company

2013 WI 29

SUPREME COURT OF WISCONSIN
CASE NO.: 2011AP2067
COMPLETE TITLE: Mary E. Marlowe and Leslie R. Marlowe,
Plaintiffs-Respondents-Petitioners,
v.
IDS Property Casualty Insurance Company,
Defendant-Appellant.

REVIEW OF A DECISION OF THE COURT OF APPEALS
Reported at 340 Wis. 2d 594, 811 N.W.2d 894
(Ct. App. 2012 – Published)
PDC No: 2012 WI App 51

OPINION FILED: April 5, 2013
SUBMITTED ON BRIEFS:
ORAL ARGUMENT: October 4, 2012

SOURCE OF APPEAL:
COURT: Circuit
COUNTY: Brown
JUDGE: Donald R. Zuidmulder

JUSTICES:
CONCURRED: ABRAHAMSON, C.J., BRADLEY, J., concur (opinion
filed).
CONCUR & DISSENT: PROSSER, J., concurs in part/dissents in part
(Opinion filed).
NOT PARTICIPATING:

ATTORNEYS:
For the plaintiffs-respondents-petitioners, there were
briefs by Ralph J. Tease Jr. and Rhonda L. Lanford, and Habush,
Habush & Rottier, S.C., Green Bay, and oral argument by Mr.
Tease.

For the defendant-appellant, there were briefs by Michael
P. Konz and Erik L. Fuehrer, and Gabert, Williams, Konz &
Lawrynk, LLP, Appleton, and oral argument by Mr. Konz.
 An amicus curiae brief was filed by James Friedman and
Dustin B. Brown, and Godfrey & Kahn, S.C., Madison, on behalf of
the Wisconsin Insurance Alliance, and oral argument by Mr.
Brown.

2
 2013 WI 29
NOTICE
This opinion is subject to further
editing and modification. The final
version will appear in the bound
volume of the official reports.
No. 2011AP2067
(L.C. No. 2011CV502)

STATE OF WISCONSIN : IN SUPREME COURT

Mary E. Marlowe and Leslie R. Marlowe,

Plaintiffs-Respondents-Petitioners,
FILED
v.
APR 5, 2013
IDS Property Casualty Insurance Company,
Diane M. Fremgen
Defendant-Appellant. Clerk of Supreme Court

REVIEW of a decision of the Court of Appeals. Modified and

affirmed and, as modified, cause remanded to the arbitration

panel with instructions.

¶1 MICHAEL J. GABLEMAN, J. We review a published
decision of the court of appeals1 reversing the Brown County

Circuit Court's declaratory judgment2 limiting discovery in an
arbitration proceeding to that allowed by Wis. Stat. § 788.07

1
Marlowe v. IDS Property Cas. Ins. Co., 2012 WI App 51, 340
Wis. 2d 594, 811 N.W.2d 894.
2
The Honorable Donald R. Zuidmulder presiding.
 No. 2011AP2067

(2009-10).3 Mary E. Marlowe and Leslie R. Marlowe (the Marlowes)

filed a claim with their insurer, IDS Property Casualty

Insurance Company (IDS), for underinsured motorist benefits

after a car accident. The parties were unable to agree on a

settlement and, pursuant to a provision of the insurance policy,

submitted the dispute to an arbitration panel. Prior to the

anticipated arbitration hearing a conflict over discovery arose,4

in which IDS sought broad discovery under Wis. Stat. ch. 804,

the general civil procedure chapter, while the Marlowes refused

to comply with such discovery on the grounds that § 788.07, the

discovery provision designed specifically for arbitration,

controlled, and permitted only the taking of certain

depositions.5 Interpreting the policy's arbitration provision in

light of our decision in Borst v. Allstate Ins. Co., 2006 WI 70,

291 Wis. 2d 361, 717 N.W.2d 42, the arbitration panel decided

3
All subsequent references to state and federal statutes
are to the versions in effect in 2010, when the dispute giving
rise to this case began, unless otherwise indicated.
4
Due to the conflict and the subsequent appeals, the
hearing never took place.
5
The differences between Wis. Stat. § 788.07 and Wis. Stat.
ch. 804 are significant. Section 788.07, which pertains only to
arbitration, limits discovery in arbitration to "the taking of
depositions to be used as evidence before the arbitrators, in
the same manner and for the same reasons as provided by law for
the taking of depositions in suits or proceedings pending in the
courts of record in this state." By contrast, ch. 804, which
applies to civil litigation in the circuit courts, allows for a
wide range of discovery tools, including interrogatories,
production of documents, physical and mental examinations of
parties, inspection of medical documents, and requests for
admissions. See generally ch. 804.

2
 No. 2011AP2067

that IDS was entitled to ch. 804 discovery. Unsatisfied, the

Marlowes successfully filed for declaratory judgment in the

circuit court, obtaining an order reversing the arbitration

panel's determination and directing that arbitration discovery

would proceed within the narrow parameters set by § 788.07. The

court of appeals reversed, concluding that the Marlowes were not

permitted to pursue relief from the circuit court before the

panel rendered a final decision on the award, and that full ch.

804 discovery was available to IDS.

¶2 We consider two issues: 1) whether the Marlowes were

permitted to seek a declaratory judgment concerning the

discovery dispute before the arbitration panel ruled on whether

an award was appropriate and, if so, its amount; and 2) whether

the panel properly established discovery procedures outside

those outlined in Wis. Stat. § 788.07. Because no unusual

circumstances justified an interlocutory appeal, we hold that

the Marlowes' action in circuit court was premature. As to the

second question, the legislature has set forth, in the form of
§ 788.07, a narrow scope of discovery for arbitration

proceedings in the absence of an explicit, specific, and clearly
drafted arbitration clause to the contrary. IDS failed to

include any such language in its policy and we therefore
instruct the panel to limit discovery to that provided for in

§ 788.07. Accordingly, we affirm the court of appeals insofar
as it declined to allow the Marlowes an interlocutory appeal.

However, insofar as the court of appeals granted IDS the benefit

of full Wis. Stat. ch. 804 discovery, we modify its decision and
3
 No. 2011AP2067

instead direct the panel to cabin discovery to the depositions

contemplated in § 788.07, i.e., "depositions to be used as

evidence before the arbitrators." Thus, the decision of the

court of appeals is modified, and as modified, affirmed, and the

cause is remanded to the arbitration panel with instructions.

I. BACKGROUND

¶3 The relevant facts are few and straightforward. In

2007, Mary Marlowe was involved in a car accident with an

underinsured driver. At the time of the accident, she was

insured by IDS, under a policy that contained a section

providing underinsured motorist coverage. Within that section,

under the heading, "Arbitration," the policy provided that

"[u]nless both parties agree otherwise, arbitration will take

place in the county in which the insured lives. Local rules of

law as to procedure and evidence will apply." (Bold in

original.) The Marlowes submitted a claim to IDS and, after

fruitless settlement discussions, the parties agreed, in

accordance with the policy, that an arbitration panel would
determine whether an award was appropriate and, if so, its

amount.
¶4 To prepare for the arbitration hearing, IDS requested

various types of discovery materials, including interrogatories,
the production of documents, the procurement of medical,

employment, and income tax records, several depositions, and an
independent medical examination. As IDS read the policy, it was

entitled to such materials because the "local rules" referred to

in the arbitration provision were located in Wis. Stat. ch. 804,
4
 No. 2011AP2067

which authorizes each of the aforementioned discovery tools.

The Marlowes refused to comply with the request, explaining that

they believed the "local rules" provision was ambiguous, and

consequently understood Borst to limit discovery to the far

narrower boundaries drawn in Wis. Stat. § 788.07, a provision

allowing only for "the taking of depositions to be used as

evidence before the arbitrators."6

¶5 After considering the parties' arguments on the issue,

the arbitration panel ruled in IDS's favor, giving it the

benefit of the broad arsenal of discovery devices described in

Wis. Stat. ch. 804. In the unanimous view of the three

arbitrators, "[t]he term 'local rules of procedure[,'] as the

policy employs it, is both clear and informative. It denotes

the civil rules of procedure that govern court proceedings daily

in local courtrooms." After the panel denied a motion to

reconsider, the Marlowes filed an action in circuit court

seeking a declaration under Wisconsin's Uniform Declaratory

Judgment Act, Wis. Stat. § 806.04, that they had a legal right

not to be subjected to the expansive discovery of ch. 804. The
circuit court agreed and issued the requested order. At the

6
At one point during the clash over the proper scope of
discovery, the Marlowes offered, "in the spirit of attempting to
reach an amicable resolution," to provide, in addition to the
depositions mentioned in Wis. Stat. § 788.07, authorizations for
all of Mary Marlowe's medical records dating back ten years from
the accident, and to make her available for a two hour
deposition. That concession has no bearing on our resolution of
the case, which hinges only on the type of discovery the law
requires, not that which it may allow parties to offer to avoid
unnecessary discord and delay.

5
 No. 2011AP2067

hearing where it reached its determination, the circuit court

explained that IDS should have included a more specific

reference to the discovery it desired in its policy if it wanted

to later take advantage of the breadth of ch. 804.

¶6 When the case reached the court of appeals, the tide

returned to IDS's favor. In its decision, the court of appeals

prohibited the Marlowes from turning to the courts before the

arbitration proceedings were complete. Marlowe v. IDS Property

Cas. Ins. Co., 2012 WI App 51, ¶¶8-18, 340 Wis. 2d 594, 811

N.W.2d 894. Despite that prohibition, however, the court of

appeals decided to reach the merits of the discovery dispute and

affirmed both the panel's reading of the policy as well as its

understanding of the panel's authority to shape the scope of

discovery as it saw fit. Id., ¶¶19-27. On the first point——

that of the interlocutory appeal——the court of appeals looked

for guidance to federal cases addressing similar issues. Id.,

¶¶10-17. The court of appeals discerned in those cases a rule

that "interlocutory review of arbitration panels' intermediate

decisions" is available only "under limited and unusual

circumstances." Id., ¶14. Seeing no such circumstances in the

Marlowes' case, the court held that the circuit court should

have waited until the panel rendered its final decision before

weighing in on the discovery dispute. Id., ¶18.

¶7 The court of appeals framed the second issue as the

scope of the arbitration panel's authority. According to the

court, the panel had the "exclusive authority" to interpret the

"local rules" provision because it "arguably refer[red] to the
6
 No. 2011AP2067

scope of discovery," a procedural matter within the sole

province of the panel under our opinion in Borst and that of the

court of appeals in Employers Ins. of Wausau v. Certain

Underwriters at Lloyd's London, 202 Wis. 2d 673, 552 N.W.2d 420

(Ct. App. 1996). Id., ¶27.

¶8 The Marlowes petitioned this court for review. In

order to clarify several important features of the arbitration

system and its relationship to the courts, we granted that

petition.

II. STANDARD OF REVIEW

¶9 The first issue before us is whether the Marlowes'

action for a declaratory judgment constituted an interlocutory

appeal and, if so, whether it was permissible. Such an issue

presents a purely legal question, and we thus consider it

independently of the opinions by the circuit court and court of

appeals, though benefitting from their analyses. See generally
State ex rel. Hass v. Wis. Court of Appeals, 2001 WI 128, 248

Wis. 2d 634, 636 N.W.2d 707.

¶10 With respect to the second issue——whether the

arbitration panel was entitled to establish discovery procedures

outside those outlined in Wis. Stat. § 788.07——"[t]he scope of

judicial review of an arbitration decision is," generally

speaking, "very limited." Orlowski v. State Farm Mut. Auto.

Ins. Co., 2012 WI 21, ¶13, 339 Wis. 2d 1, 810 N.W.2d 775

(citation omitted). As such, "[t]here is a strong presumption

of arbitrability where the contract in question contains an

arbitration clause," and "[a]ny doubts concerning the scope of
7
 No. 2011AP2067

arbitrable issues should be resolved in favor of arbitration."

Cirilli v. Country Ins. & Fin. Servs., 2009 WI App 167, ¶14, 322

Wis. 2d 238, 776 N.W.2d 272 (citation omitted). Pursuant to the

same deferential standards, an arbitrator's decision concerning

an award will not be overturned unless "perverse misconstruction

or positive misconduct is plainly established, or if there is a

manifest disregard of the law, or if the award itself is illegal

or violates strong public policy." City of Madison v. Madison

Prof'l Police Officers Ass'n, 144 Wis. 2d 576, 586, 425 N.W.2d 8

(1988) (internal quotation marks, brackets, and citation

omitted). But where, as here, a dispute implicates the scope of

an arbitration panel's authority concerning discovery, an issue

the legislature has spoken on, the standard of review is less

deferential. As we explain in detail below, an arbitration

panel's decision will be reversed when it allows for discovery

different from that granted in § 788.07 unless the agreement

between the parties contains an explicit, specific, and clearly

drafted clause adopting or spelling out a different set of

discovery guidelines. See generally Borst, 291 Wis. 2d 361.

III. DISCUSSION

¶11 We hold as follows. As no unusual circumstances were

present to justify an interlocutory appeal, the circuit court

erred in declaring the Marlowes' rights on a procedural matter

before the arbitration panel satisfied its responsibilities and

settled the question of compensation. However, given that there

was no explicit, specific, and clearly drafted agreement in the

policy detailing the discovery procedures to follow, the panel
8
 No. 2011AP2067

should not have granted IDS the use of Wis. Stat. ch. 804's full

range of discovery mechanisms. Consequently, we return the

action to the panel with instructions to limit discovery to the

section enacted by the legislature for precisely these

situations: Wis. Stat. § 788.07.

A. The Interlocutory Appeal

¶12 We consider first whether the Marlowes improperly

sought interlocutory relief. The Marlowes contend that they did

not seek such relief and, if they did, that it was permitted.

Consistent with well-reasoned precedent from other jurisdictions

and with the fundamental and crucial purposes of arbitration, we

find that they did seek interlocutory relief, and that it was

barred.

1. The Marlowes Sought Interlocutory Relief

¶13 To ascertain whether the Marlowes improperly pursued

interlocutory relief, we must, as a threshold matter, determine

whether they pursued interlocutory relief at all. Applying

basic principles of appellate procedure, we have no difficulty

in answering that they did.

¶14 The Marlowes' argument for why their filing in circuit

court did not represent an interlocutory appeal hinges on their

belief that the arbitration panel was not empowered to order

Wis. Stat. ch. 804 discovery. As the Marlowes see it, since the

panel had no authority to issue that order, its order was null

and void ab initio, that is, from the beginning, and the circuit

court was not reviewing the order at all, let alone on an

interlocutory basis. The Marlowes' position is founded on
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 No. 2011AP2067

several fundamental misunderstandings of the law, and we cannot

accept it.

¶15 First, the Marlowes' premise flows from an untenably

theoretical and impractical characterization of judicial

mechanics. Even if we suspend disbelief and assume with the

Marlowes that an order exceeding an arbitration panel's power

vanishes when the order is questioned in court, that does not

change the fact that the filing in circuit court interrupts an

ongoing proceeding before the panel. That is, regardless of

whether the panel's discovery order was null or not, there was

nevertheless an arbitration in progress at the time it was

issued. It is this fact——not the correctness or validity of the

order——that renders the action interlocutory. See, e.g., Brown

v. Argosy Gaming Co., L.P., 360 F.3d 703, 706 (7th Cir. 2004)

(defining an interlocutory action as "one that merely gives

pause to the ongoing proceedings to resolve one issue in a

larger, ongoing dispute . . . .") (Emphasis added.)

¶16 In any event, the arbitration panel indisputably had

the authority to issue an order relating to discovery, the only

complaint the Marlowes raise is whether it issued the correct

discovery order. Throughout the course of this controversy, it

has never been suggested by any party or decision-maker that the

arbitration panel was forbidden from determining the boundaries

of discovery. Rather, the Marlowes simply assert that the panel

erroneously set those boundaries in accordance with one chapter

of the statutes instead of another. It follows, then, as amicus

Wisconsin Insurance Alliance helpfully points out, that from the
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 No. 2011AP2067

Marlowes' perspective, the panel would have acted within its

jurisdiction if it had ordered discovery in line with Wis. Stat.

§ 788.07 but exceeded its jurisdiction by ordering discovery in

line with Wis. Stat. ch. 804. If that were true, a panel would

have jurisdiction only if the outcome happened to turn out to be

right in the judgment of the courts. That is not how

jurisdiction works. See, e.g., Gen. Comm. of Adjustment v. Mo.-

Kan.-Tex. R.R Co., 320 U.S. 323, 337 (1943) ("When a court has

jurisdiction it has of course authority to decide the case

either way.") (emphasis added) (citation and internal quotation

marks omitted). For the foregoing reasons, there can be no

doubt that the circuit court's declaration of the Marlowes'

rights granted them interlocutory relief.

2. Interlocutory Relief Was Not Available to the Marlowes

¶17 Having shown why the Marlowes' action in circuit court

was interlocutory, we must now confront the question of whether

they were permitted to seek such relief. In view of the

important and well-established purposes of arbitration, they

were not so permitted.

¶18 We start, as the court of appeals before us did, with

the recognition that this issue is one of first impression in

Wisconsin. Fortunately, though, it is far from that elsewhere.

In the absence of binding authority construing the Wisconsin

Arbitration Act, we look for guidance to decisions from other

jurisdictions interpreting similar provisions of their own

arbitration acts. Borst, 291 Wis. 2d 361, ¶30. Wisconsin Stat.

§§ 788.10 and 788.11 set forth the circumstances in which a
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court can take action on an arbitrator's decision, and thus form

the bases for our inquiry into the availability of interlocutory

relief on an arbitration ruling. The same role is performed in

the Federal Arbitration Act by 9 U.S.C. §§ 10 and 11, which

contain nearly identical language to the corresponding Wisconsin

provisions. We therefore consult the non-binding cases

addressing the issue as persuasive authority, and in this

instance we find them especially persuasive.

¶19 A number of other jurisdictions have held that

intermediate relief from arbitrators' decisions is not typically

available. See Kristen M. Blankley, Did the Arbitrator

"Sneeze"?--Do Federal Courts have Jurisdiction over

"Interlocutory" Awards in Class Action Arbitrations?, 34 Vt. L.

Rev. 493, 506 (2010) ("The courts, when usually confronted with

non-final awards, claim that they should generally refrain from

intervention and allow arbitration to run its course."). These

decisions are based on the sound theory that the courts must

facilitate as much as possible the primary aims of arbitration:

providing a forum to resolve disputes more quickly, efficiently,

and cheaply than courts can. See Compania Panemena Maritima San

Gerassimo, S.A. v. J.E. Hurley Lumber Co., 244 F.2d 286, 289 (2d

Cir. 1957)(noting that challenges to intermediate arbitration

decisions "result only in a waste of time, the interruption of

the arbitration proceeding, and encourage delaying tactics in a

proceeding that is supposed to produce a speedy decision.");

Travelers Ins. Co. v. Davis, 490 F.2d 536, 544 (3d Cir. 1974)

(declining to allow an interlocutory appeal of an interim
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arbitration decision because "[p]iecemeal litigation would

result"). In Wisconsin, as much as in the federal system,

arbitration is designed to facilitate the speedy, efficient

resolution of disputes without encumbering parties with all of

the expenses and formalities associated with civil litigation in

the courts. See, e.g., Franke v. Franke, 2004 WI 8, ¶24, 268

Wis. 2d 360, 674 N.W.2d 832 ("[P]ublic policy favors arbitration

as promoting the efficient resolution of disputes, and as giving

the parties what they bargained for, that is, an arbitrator's,

not a court's decision."). Those advantages accrue not only to

parties but to the circuit courts, which experience a lightening

of their substantial dockets, saving the taxpayers money and

litigants both money and time. See, e.g., Balt. & Ohio Chi.
Terminal R.R. Co. v. Wis. Cent. Ltd., 154 F.3d 404, 409 (7th

Cir. 1998) (Posner, J.) (remarking that one purpose of

arbitration "is to lighten the pressure on the courts")

(citation omitted). It is self-evident that any rule

encouraging parties to shuttle their cases to and from court in

the midst of an arbitration proceeding would substantially slow

down the arbitration process and impose significant costs on the

parties, thereby defeating the most central objectives of

arbitration. We therefore adopt the sensible rule followed by

the authorities cited above, and hold that in Wisconsin a party

involved in an arbitration proceeding must ordinarily wait until

the arbitrators have reached a final decision on the award to be

given, if any, before turning to the circuit courts.

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¶20 Those courts that have permitted interlocutory review

during an arbitration proceeding have done so only in rare

circumstances that present a compelling reason to depart from

the normal practice. For instance, interlocutory appeals have

been entertained when the intermediate ruling could subject the

aggrieved party to irreparable harm, Aerojet-General Corp. v.

Am. Arbitration Ass'n, 478 F.2d 248, 251 (9th Cir. 1973)

(regarding the fixing of venue), or when such review is

necessary to preserve assets pending a final ruling from the

arbitrator on the award. Yasuda Fire & Marine Ins. Co. v.
Cont'l Cas. Co., 37 F.3d 345, 347-48 (7th Cir. 1994). Again, we

embrace the unassailable logic underlying these cases, as they

properly balance the need for efficient and orderly arbitration

proceedings with the need for an occasional exception to

accommodate especially urgent or potentially irreparably

prejudicial matters that demand the immediate attention of the

courts.

¶21 The Marlowes do not suggest that the discovery dispute

at arbitration was unusual in such a way as to justify

intermediate intervention by the circuit court, and we see no

evidence to that effect. On the contrary, there has been no

showing that the request for limited discovery was either

especially urgent or that it posed the threat of irreparable

injury. Tellingly, in the only Wisconsin case involving a

similar discovery dispute, we remanded the cause back to the

arbitration panel after it had allowed overbroad discovery and

issued an award, Borst, 291 Wis. 2d 361, ¶4, thus indicating
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that such disputes can be effectively resolved within the course

of the ordinary appellate process, without resorting to

inefficient, time-consuming practices which defeat the very

purpose of arbitration. While certainly not dispositive of the

matter, this precedent underscores why the arbitration panel

here was entitled to fully discharge its duties before being

second-guessed on an intermediate matter by the circuit court.7

As a result, we affirm the court of appeals decision insofar as

it correctly held that the Marlowes' action for declaratory

relief constituted an improper interlocutory appeal.

B. The Discovery Dispute

¶22 Although it seems at first blush incongruous for us to

first hold that the Marlowes were not permitted to seek

interlocutory relief and then grant such relief, we do so

because the court of appeals unnecessarily and incorrectly

addressed the merits of the discovery dispute before us. The

court of appeals elected to address the discovery dispute while

recognizing that it did not need to reach the question after
holding that an intermediate appeal was barred. Marlowe, 340

7
As it is unnecessary to the resolution of this case, we do
not demarcate today the full range of situations in which
intermediate relief may be available to a party challenging an
adverse decision made at arbitration. See State v. Smith, 2012
WI 91, ¶62 n.19, 342 Wis. 2d 710, 817 N.W.2d 410 (reminding
"that the court resolves the facts before it, and does not issue
advisory opinions or address hypothetical facts") (citation
omitted), cert. denied, 568 U.S. __, 133 S. Ct. 635 (2012). We
caution that other circumstances may arise in which such appeals
may be appropriate, and they should be considered on their own
facts, under the same broad principles we enunciate here.

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Wis. 2d 594, ¶19 n.8. As we will show, the court of appeals

erred in concluding that the arbitration panel had the exclusive

authority to dictate the discovery procedures to follow, and the

arbitration panel erred in ordering full Wis. Stat. ch. 804

discovery. Therefore, if we were to limit our review to the

issue of interlocutory relief, we would allow an erroneous rule

to retain the force of law, not only in this case, but in all

others. Moreover, further delay of the issue's ultimate

resolution would impede even further the efficient disposition

the parties bargained for by agreeing to arbitration. Lastly,

we will be required to answer the important question presented

by the discovery dispute sooner or later. It would only

frustrate judicial economy were we to unnecessarily put the

question off for another day, particularly when we would thereby

cause arbitration in this case to proceed under the wrong

statute in violation of a clear legislative dictate. With that

in mind, we choose to take up the question sooner rather than

later.8

8
As the concurrence sees it, our reasoning on this point
"justif[ies] judicial intervention by the circuit court . . . ."
Concurrence, ¶67 (emphasis added). Phrased differently, the
concurrence believes that the unusual circumstances present here
warranted interlocutory relief at every level of the court
system. As should be clear from our analysis, though, the
reasons requiring us to reach the discovery dispute——the fact
that the court of appeals erroneously reached and decided the
question, the gross and perverse inefficiency of further delay,
and the inevitability of our ultimate consideration of the
issue——are reasons that apply with special force here, and have
little to no relevance to the circuit court. That court, unlike
our own, was not required to correct an erroneous, published
appellate opinion, because the case had not yet arrived at the
16
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¶23 As we demonstrate below, a fair reading of the policy,

under our binding and well-reasoned case law, prohibited the

arbitration panel from ordering full Wis. Stat. ch. 804

discovery. That same case law allows for judicial correction of

the panel's error. Accordingly, we instruct the arbitration

panel to limit discovery to that provided for in Wis. Stat.

§ 788.07.

1. Discovery Should Have Been Limited to Wis. Stat. § 788.07

¶24 From the onset of this dispute, the central importance

of one decision has been acknowledged by all involved: our

opinion in Borst. Upon review of that case, we find its

appellate level and because it would not have been empowered to
do so. In addition, there was far less of a demand for
expeditiousness in the circuit court's disposition than ours, as
the case had been pending for a significantly shorter period at
that time and was undergoing its first stage of judicial review,
not its third. Finally, it was not so urgent as a state-wide
matter for the circuit court to resolve the question, as its
opinion bound only the parties and not, like our own, all
Wisconsin contract-drafters, contract-signers, and courts. See
Raasch v. City of Milwaukee, 2008 WI App 54, ¶8, 310
Wis. 2d 230, 750 N.W.2d 492 (Ct. App. 2008) ("[A]lthough
circuit-court opinions may be persuasive because of their
reasoning, they are never 'precedential.'") (emphasis in
original) (citation omitted). To the extent the concurrence
believes that some unique circumstance justified the circuit
court's interlocutory intervention, we see no persuasive
reasoning to that effect in the concurrence itself, and no
reasoning to justify that result at all in our own discussion,
in the briefs, or in any authority that has been brought to our
attention. The concurrence observes that it is incongruous not
just at first blush, but at "second[] or third blush" to find
judicial relief from the circuit court premature while granting
it here. Concurrence, ¶67. That may be, but the concurrence
cannot resolve the incongruity either, no matter how much
blushing it does.

17
 No. 2011AP2067

application here clear. If IDS desired to utilize Wis. Stat.

ch. 804 discovery, it was required to expressly, clearly, and

specifically say so in its policy. Because it did not, the

panel erred in ordering such discovery and Borst compels us to

correct the error.

a) Borst Is Clarified and Reaffirmed

¶25 Although we do not share IDS's view that the facts of

Borst are particularly helpful to our decision here, in light of

its unequivocal holding, we briefly recite the relevant details

to provide context and to address IDS's argument. In Borst, the

plaintiff was injured in a car accident with an uninsured

motorist and filed a claim for compensation with his insurer,

Allstate Insurance Company (Allstate). 291 Wis. 2d 361, ¶5.

After settlement negotiations failed, the claim was submitted to

arbitration pursuant to a provision in the policy that was

silent on the question of the scope of discovery. Id., ¶8. In

anticipation of the arbitration hearing, Allstate asked Borst

for answers to written interrogatories, document production, and

medical authorizations. Id., ¶10. Borst refused to comply,

instead filing a motion to quash the discovery. Id.

Eventually, Borst sued Allstate in circuit court on claims of

breach of contract, bad faith, and fraud and misrepresentation.

Id., ¶12. Borst also sought a permanent injunction enjoining

further arbitration. Id. After the circuit court remanded the

matter back to the arbitrators, the panel allowed Allstate's

requested broad discovery and decided the award, the circuit

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 No. 2011AP2067

court confirmed that award, and the court of appeals then

certified the case to this court.

¶26 As for the most important aspect of Borst——its

holding——this court unanimously ruled in that case that the

panel erred in permitting extensive discovery and should instead

have confined it to the depositions afforded in Wis. Stat.

§ 788.07. We began our consideration of the issue with a

summary, in a paragraph worth quoting in full for reasons that

will soon be apparent, thusly:

We conclude that arbitrators have no inherent
authority to dictate the scope of discovery, and
absent an express agreement to the contrary, the
parties are limited to depositions as spelled out in
Chapter 788. We agree with the State Bar that parties
would be well-served to either: (1) explicitly address
the scope of discovery and the procedures to resolve
disputes regarding discovery; or (2) reference a set
of established [Alternative Dispute Resolution]
provider rules that specify how discovery should be
handled.

Id., ¶56.
¶27 To reach that result, the Borst court first examined

the text of Wis. Stat. § 788.07 and the Wisconsin Arbitration

Act as a whole, concluding that neither mentioned any type of

discovery other than "depositions to be used as evidence before

the arbitrators." Id., ¶58 (quoting § 788.07). "To allow for

the amount of discovery Allstate seeks," the court went on, "we

would have to read more into § 788.07 than is present in the

statutory language," an approach that would transgress

established rules of statutory construction. Id. (citation

omitted).

19
 No. 2011AP2067

¶28 Continuing its analysis, Borst observed that because

arbitration is a matter of contract, the "parties can contract

to allow arbitrators a wide amount of latitude in managing the

arbitration, subject to the constraints of the law." Id., ¶59

(citing Employers, 202 Wis. 2d 673). Justice Wilcox, speaking

for the court, therefore determined that "absent a contractual

provision specifying how discovery will be handled, the parties

are limited to the discovery procedures provided in" Wis. Stat.

§ 788.07. Id. In support of that conclusion, the court
reasoned that a grant of inherent authority to arbitrators to

order broader discovery where the policy is silent on the scope

of discovery "would give us pause as we do not want to turn the

arbitration process into another trial system," with all of its

attendant formalities and expenses. Id., ¶¶60, 61. Stated

differently, "[a]rbitrators have no inherent authority to

dictate the scope of discovery and absent an express agreement,

the parties are limited to the procedure for depositions, as

described in Wis. Stat. § 788.07." Id., ¶63. "[T]he better

approach," we therefore concluded, "is to leave it to the

parties, in the future, to ensure arbitration agreements are

clearly drafted, and detail the necessary components and

procedures of the desired arbitration." Id., ¶60. Turning to

the facts at hand, we explained that "there were no set

provisions in the insurance contract that detailed the terms of

the discovery in the arbitration. Therefore, if the parties

decide to conduct another arbitration, discovery will be limited

20
 No. 2011AP2067

to depositions as detailed in Wis. Stat. § 788.07." Id., ¶62

(footnote omitted).

¶29 Given the overwhelming significance of Borst to the

case at bar, we pause to clarify its holding and reaffirm its

soundness. Borst was not as precise as it might have been on

what is required of an arbitration clause in order for the

parties to have access to discovery broader than that

contemplated in Wis. Stat. § 788.07. To be sure, the opinion

did use a number of terms with roughly similar, if not

identical, meanings: "express," "explicitly," "specify,"

"clearly drafted," "detail," and so on. Yet as IDS fairly

observes, most of these terms are not presented as formulations

of the holding, and some are not even formulated as

requirements. For example, the Borst court indicated "that
parties would be well-served to . . . explicitly address the

scope of discovery," id., ¶56 (emphasis added), not that they

had to. Likewise, the court advised that "the better approach

is to leave it to the parties, in the future, to ensure

arbitration agreements are clearly drafted," id., ¶60 (emphasis

added), but stopped short of announcing that inferior approaches

would necessarily deprive parties of Wis. Stat. ch. 804's

discovery tools.

¶30 We need not be detained by such ambiguity long, for we

conclude that Borst's several formulations of the standard

cohere to form a single holding: for a party in arbitration to

enjoy discovery outside of Wis. Stat. § 788.07, the insurance

policy must provide for it expressly, explicitly, specifically,
21
 No. 2011AP2067

and in a clearly drafted clause. To begin, the various

iterations of the standard set forth in Borst are plainly not in

conflict with one another. That is to say, a provision may

plainly be express, explicit, specific, and clearly drafted all

at the same time. More importantly, if an arbitration panel has

no inherent authority to order Wis. Stat. ch. 804 discovery in

the absence of a policy provision to the contrary, and if that

is in part because the legislature has enacted a statute to

address this narrow area of law, it naturally follows that the

discovery provision must be "express," "explicit," "specific,"

and "clearly drafted."9 Without that requirement, as we explain
shortly, § 788.07 would lose all force, and we cannot treat

legislative commands so cavalierly. For purposes of summary and

clarification, everything we said in Borst about how a policy

can authorize discovery broader than that envisioned by

§ 788.07, whether hortatory or mandatory, is the law: to permit

such discovery, the policy must provide for it explicitly,

specifically, and in a clearly drafted clause.10

9
Because the words "express" and "explicit" have similar
meanings, and because we believe "explicit" covers the same
ground as "express" and more, in the interest of simplicity we
henceforth omit the word "express" from the standard. See The
American Heritage Dictionary 626 (5th ed. 2011) (indicating that
"express" is synonymous with "explicit").
10
The concurrence/dissent characterizes these requirements
as "tough new conditions" set by today's opinion. Dissent,
¶114. They may be tough, but they are certainly not new, as
each word appears in Borst v. Allstate Ins. Co., 2006 WI 70, 291
Wis. 2d 361, 717 N.W.2d 42. For ease of reference, we will
henceforth refer to the concurrence/dissent as simply "the
dissent."

22
 No. 2011AP2067

¶31 Understood in these terms, the holding of Borst is as

vital today as it was at the time the case was decided. In

short, arbitration must remain a speedy, cost-efficient

alternative to conventional litigation, not an equally slow,

cumbersome process that simply happens to take place in front of

an arbitration panel rather than a circuit court judge. Id.,

¶60 ("[W]e do not want to turn the arbitration process into

another trial system."); cf. Franke, 268 Wis. 2d 360, ¶24

("[P]ublic policy favors arbitration as promoting the efficient

resolution of disputes, and as giving the parties what they

bargained for, that is, an arbitrator's, not a court's

decision."). With Wis. Stat. ch. 804 discovery, arbitration

proceedings become, quite literally, the mirror image of civil

litigation, at least as respects discovery. As Borst

recognized, arbitration is a creature of contract, and if

parties desire to engage in the same time-consuming and

burdensome discovery tactics that lengthen delays and increase

costs in the circuit courts, that is their prerogative. 291

Wis. 2d 361, ¶59 ("[P]arties can contract to allow arbitrators a

wide amount of latitude in managing the arbitration . . . .")

(Emphasis added.) But that is a far cry from an ever-present

legal entitlement to such tactics in a proceeding designed to do

without them.11

11
In its ruling on the discovery dispute, the arbitration
panel insisted that, "[if] the purpose of arbitration is to
achieve an expedited, efficient decision that ultimately
determines the truth, more, not less, preparation for hearing is
the most sensible way to achieve that . . . ." We do not grasp
the panel's reasoning. Certainly an argument could be made that
23
 No. 2011AP2067

¶32 The second, and related, strain of reasoning

underpinning Borst is equally persuasive to us now: the

legislature has provided a boundary for the scope of discovery

in arbitration to serve as the default, and, in the absence of

any contractual agreement to the contrary, that boundary should

be given effect. We fully agree with Borst that we would

insufficiently respect our co-equal branch were we to allow

arbitrators to ignore a legislative dictate at will. 291 Wis.2d

361, ¶58 ("To allow for the amount of discovery Allstate seeks,

we would have to read more into § 788.07 than is present in the

statutory language."). If arbitrators could order discovery

outside the confines of § 788.07 whenever they chose, regardless

of what the policy provided, the statute would lose all force,

an outcome we are loath to sanction. See State ex rel. Kalal v.
Cir. Ct. for Dane Cnty., 2004 WI 58, ¶44, 271 Wis. 2d 633, 681

N.W.2d 110 ("It is, of course, a solemn obligation of the

judiciary to faithfully give effect to the laws enacted by the

legislature . . . ."). And, as should be evident already, we

believe the legislature's approach to discovery in arbitration

was eminently reasonable, as it is entirely in keeping with the

more expansive discovery better facilitates a search for the
"truth," but we fail to understand how broader discovery could
possibly be regarded as more "expedited" or "efficient."
Similarly, the panel took pains to note that Wis. Stat. ch. 804
does "not contemplate unfettered discovery," but rather
discovery "that is quick and efficient, [and] cost effective."
That may be, but it surely does contemplate discovery that is
less fettered than that authorized by Wis. Stat. § 788.07, as
well as less quick, less efficient, and less cost effective,
which is exactly the point.

24
 No. 2011AP2067

fundamental goals of the system: efficient, inexpensive

resolution of disputes.

¶33 There is one other aspect of Borst that requires

clarification. To repeat language we have already quoted, the

Borst court remarked that "parties would be well-served to

either: (1) explicitly address the scope of discovery and the

procedures to resolve disputes regarding discovery; or (2)

reference a set of established [Alternative Dispute Resolution]

provider rules that specify how discovery should be handled."

291 Wis. 2d 361, ¶56 (emphasis added). As suggested by our

emphasis, it is important that Borst phrased this as an
either/or proposition. That is, parties can make available

discovery that differs from the depositions contemplated by Wis.

Stat. § 788.07 without necessarily referring to a set of

discovery guidelines established elsewhere, so long as the

parties spell out the discovery guidelines themselves in the

arbitration agreement. In other words, rather than providing,

say, that "Wis. Stat. § 788.07 will govern all discovery in

preparation for the arbitration hearing," a policy could instead

enumerate the types of discovery the parties would have access

to in arbitration, such as interrogatories, medical

examinations, and so on. However, if a policy takes that

approach, it must meet the same standard that applies when an

arbitration clause adopts a set of guidelines articulated

25
 No. 2011AP2067

elsewhere: it must express the types of discovery explicitly,

specifically, and in a clearly drafted clause.12

¶34 Before turning to the application of Borst here, one

final point must be made. Wisconsin Stat. § 788.06(2)

authorizes arbitrators and parties' representatives to issue

subpoenas under Wis. Stat. § 805.07, the general subpoena

statute in the code of civil procedure. In contradistinction to

the dissent, we do not understand § 788.06(2) to expand the

scope of arbitration discovery because the provision relates to

the arbitration hearing itself, not the discovery that may

precede it. The heading of the statute confirms our

interpretation, as it reads, "Hearings before arbitrators;

12
The dissent rejects this rule, but it is not clear
exactly why or in favor of what. In places, the dissent
suggests that Borst was wrongly decided. Dissent, ¶111
("Borst's interpretation of Wis. Stat. § 788.07 created a
restrictive rule, but that rule disregarded the adjacent
statute . . . ."). Elsewhere, the dissent instead pins the
blame on today's majority, accusing it of injecting a novel
misunderstanding into the law. See, e.g., id., ¶114 (describing
the "explicit, specific, and clearly drafted" test as imposing
"tough new conditions . . . .") (emphasis added); ¶88 ("[T]he
majority opinion undercuts the contractual authority of
arbitrators and creates a serious disincentive for parties to
agree to arbitration.") (Emphasis added.) Both cannot be true.
Although the dissent somewhat ambiguously proposes that the
"court should pursue" the "options" of "clarify[ing],
modif[ying], or distinguish[ing]" Borst "on the facts," dissent,
¶100, the dissent's bottom-line, that the "explicit, specific,
and clearly drafted" test be discarded, is fundamentally
incompatible with Borst's unequivocal holding and its underlying
reasoning. We see no way in which those words and the rationale
behind them can be "clarified, modified, or distinguished" out
of the opinion. However it chooses to couch the issue, the
dissent would essentially have us overrule Borst, and for the
reasons stated, we decline to do so.

26
 No. 2011AP2067

procedure."13 (Emphasis added.) See Pure Milk Prods. Coop. v.

Nat'l Farmers Org., 64 Wis. 2d 241, 253, 219 N.W.2d 564 (1974)

("Although the title is not part of the statute it may be

persuasive of the interpretation to be given the statute.").

Presumably, the parties, the arbitration panel, and the court of

appeals all acknowledged this fact, as none mentioned

13
In a passing footnote, the dissent intimates that the
appearance of the word "Hearings" in the heading is
inconsequential on account of the semicolon and text that
follow: "Hearings before arbitrators; procedure." Dissent, ¶106
n.7. According to the dissent, the "Hearings" goes with Wis.
Stat. § 788.06(1), whereas the "procedure" goes with (2). Id.
In line with that reading, the dissent flatly asserts that
"[t]he procedure applies to more than hearings because of the
references to Wis. Stat. § 805.07." Id. But the following
sections are as much about arbitration procedure as are the
subpoena provisions. See Wis. Stat. § 788.07 (dealing with
depositions in arbitration); Wis. Stat. § 788.08 (requiring that
awards be in writing and signed by a majority of the arbitration
panel); Wis. Stat. § 788.09 (setting forth the procedure for
confirming arbitration awards in court); Wis. Stat. § 788.10
(establishing the mechanisms for vacating awards and obtaining a
rehearing by the arbitrators). And as the dissent implies, at
least some of § 788.06(2) is unquestionably about hearings,
namely its references to "the circuit court for the county in
which the hearing is held" and to "[w]itnesses and interpreters
attending before an arbitration." (Emphasis added.) If the
legislature intended to enact two unrelated provisions, one
about hearings and one covering subpoenas with no connection to
hearings, it presumably would have made § 788.06(1) its own
section, and entitled it "Hearings before arbitrators," and
given § 788.06(2) its own section and entitled it "Subpoenas,"
much as it did with the very next section, which is entitled
"Depositions" and discusses, unsurprisingly, depositions. We
prefer to begin with the assumption that the legislature's
organizational scheme and choice of headings matters, rather
than discounting it out of hand. See, e.g., State v. Leitner,
2002 WI 77, ¶33, 253 Wis. 2d 449, 646 N.W.2d 341 (reiterating
that the court presumes that the legislature acted carefully in
drafting laws).

27
 No. 2011AP2067

§ 788.06(2) or the subpoena power at any stage of the

proceedings.14 Borst did not consider § 788.06(2) either, we

assume for the same good reasons, namely, that everyone involved

in the case tacitly recognized that the provision dealt with

hearings, not discovery.15

¶35 The statutory history of Wis. Stat. § 788.06(2)

confirms our interpretation of its significance. See State v.

Gilbert, 2012 WI 72, ¶16, 342 Wis. 2d 82, 816 N.W.2d 215 ("[A]

review of statutory history is part of a plain meaning

analysis.") (citation and internal quotation marks omitted),

cert. denied, 568 U.S. __, 133 S. Ct. 560 (2012). The first

version of the statute appeared in 1931. Compare Wis. Stat. ch.

298 (1929) with Wis. Stat. ch. 298 (1931). At that time, only

the arbitrators, not the parties, were empowered to issue

subpoenas. See Wis. Stat. § 298.06 (1931). Moreover, the

statute contained several indications that the subpoena power

related only to the hearing, not to pre-hearing discovery. For

example, § 298.06 authorized the arbitrators to "summon in

writing any person to attend before them or any of them as a

14
The circuit court did refer to Wis. Stat. ch. 788's
subpoena powers at several times during the hearing, but chiefly
to make the point that IDS never applied to the panel to use
such powers.
15
In its briefs here and in the court of appeals in Borst,
Allstate mentioned Wis. Stat. § 788.06(2) in passing, purely so
as to distinguish the dispute from a federal case addressing the
question of whether arbitration panels are empowered to subpoena
third parties. Allstate, like IDS, never asked us to construe
§ 788.06(2) as expanding the scope of discovery at arbitration.

28
 No. 2011AP2067

witness . . . ." Id. (Emphasis added.) The statute also

instructed that subpoenas in arbitration would "be served in the

same manner as subpoenas to appear and testify before the

court." (Emphasis added.) Such language strongly reinforces

the view that the subpoena power related to hearings, not to

discovery.

¶36 In 1985, the arbitration subpoena statute, by then

renumbered Wis. Stat. § 788.06, took on its current form. See

1985 Wis. Act 168, § 1. The principal substantive change in the

statute was the extension of the subpoena power from solely the

arbitrators to the arbitrators and the parties (through their

representatives). See Wis. Stat. § 788.06(2) (1985).

Presumably as part of the effort to modernize, condense, and

clarify the statute, however, the language quoted above

referring to hearings was removed. However, two significant

additions were made that demonstrate the subpoena power

continued to relate only to hearings. First, the statute was

now entitled, "Hearings before arbitrators; procedure." Id.

(Emphasis added.) Equally importantly, the legislature inserted

the following sentence into § 788.06(2): "If any person so

served neglects or refuses to obey the subpoena, the issuing

party may petition the circuit court for the county in which the

hearing is held to impose a remedial sanction . . . in the same

manner provided for witnesses in circuit court." Id. (Emphasis

added.) It would be peculiar, to say the least, for a discovery

statute to refer to a hearing that might never occur as though

it were inevitable. See, e.g., Bell Atlantic Corp. v. Twombly,
29
 No. 2011AP2067

550 U.S. 544, 559 (2007) (noting that "the threat of discovery

expense will push cost-conscious defendants to settle even

anemic cases before reaching those proceedings.").16

16
Because Wis. Stat. § 788.06 is unambiguous, we need not
consult any extrinsic sources to ascertain the intent behind it,
such as legislative history. See, e.g., State v. Lamar, 2011 WI
50, ¶23, 334 Wis. 2d 536, 799 N.W.2d 758 ("If the language [of a
statute] is ambiguous, however, we look beyond the language and
examine extrinsic sources of statutory interpretation, such as
the legislative history of the statute.") (citation omitted).
Even if it were accepted, arguendo, that the statute was
ambiguous, however, the legislative history would reaffirm our
reading. Concededly, the language from the 1931 statute more
directly conveyed the fact that it was limited to hearings than
does the current statute, given that it explicitly cabined the
subpoenas to summons to "any person to attend before [the
arbitrators] . . . as a witness . . . ." Wis. Stat. § 298.06
(1931) (emphasis added). By contrast, the current incarnation
of the statute does not so precisely define the proceedings to
which the subpoenas apply. See § 788.06. Nevertheless, the
only notes in the sparse legislative materials for 1985 Wis. Act
168, § 1 that shed any light on the purpose of the alterations
focus exclusively on the expansion of the subpoena power to
parties' representatives; they say nothing about an expansion of
the statute from hearings to discovery. See Drafting File, 1985
Wis. Act 168, Judicial Council Note on A.B. 498, Legislative
Reference Bureau, Madison, Wis. ("The revised section permits
arbitration subpoenas to be issued by any arbitrator or by an
attorney for a party who has been delivered blank subpoenas by
an arbitrator. It conforms arbitration subpoena practice to
that followed in circuit court.") (emphasis added); Drafting
File, 1985 Wis. Act 168, Fiscal Estimate by the Director of
State Courts on A.B. 498, Legislative Reference Bureau, Madison,
Wis. ("This bill would allow arbitration subpoenas to be issued
by any arbitrator or by an attorney for a party who has been
delivered blank subpoenas by an arbitrator. Presently, a
majority of the arbitrators sitting at the hearing must sign the
summons.") (Emphasis added.) It can only be inferred from this
single-minded focus that the legislature had no desire to expand
subpoenas from the hearing context to that of discovery.

30
 No. 2011AP2067

¶37 There is no cause to apply Wis. Stat. § 788.06(2)

here, and there was no cause to do so in Borst.17

¶38 For the stated reasons, Borst was rightly decided and

it remains good law. We now apply it to the present case.

b) The Policy Did Not Satisfy Borst's Requirements

¶39 Reviewing the policy under the well-reasoned Borst

decision, we hold that the arbitration panel erred in ordering

broad discovery when the policy contained no explicit, specific,

and clearly drafted clause making such discovery available.

¶40 There are two pertinent passages from the policy. As

noted, the one that has been at the crux of this dispute, and

therefore the one on which most of our analysis will focus,

provides that "[l]ocal rules of law as to procedure and evidence

will apply" at arbitration. Before we get to that clause,

however, there is another provision that warrants examination.

That provision indicates that "[a] person seeking any coverage

must: . . . [c]ooperate with [IDS] in the investigation,

settlement or defense of any claim or suit" and "[s]ubmit, as

often as [IDS] reasonably require[s] . . . [t]o physical exams."
IDS does not contend in its brief here that this provision

17
The dissent complains that it "makes little sense" that
Wis. Stat. § 788.06 is confined to hearings. Dissent, ¶106.
Maybe so, but it was the legislature's decision, not ours, and
we do not sit in judgment of its wisdom. See, e.g., Progressive
Northern Ins. Co. v. Romanshek, 2005 WI 67, ¶60, 281
Wis. 2d 300, 697 N.W.2d 417 ("When acting within constitutional
limitations, the legislature settles and declares the public
policy of a state, and not the court.") (internal quotation
marks and citation omitted).

31
 No. 2011AP2067

imposes a freestanding requirement independent of the

arbitration clause that the Marlowes violated by refusing to

engage in full Wis. Stat. ch. 804 discovery. Asked at oral

argument whether that was his position, counsel for IDS

responded that such an argument had been made to the arbitration

panel, and that if IDS had sought a medical examination pursuant

to the provision that the Marlowes "would have" refused. We

decline to entertain an argument that has not been properly

submitted to our consideration, and we decline to base our

ruling on a hypothetical series of events. State v. Smith, 2012
WI 91, ¶62 n.19, 342 Wis. 2d 710, 817 N.W.2d 410 (reminding

"that the court resolves the facts before it, and does not issue

advisory opinions or address hypothetical facts") (citation

omitted), cert. denied, 568 U.S. __, 133 S. Ct. 635 (2012).

¶41 Nevertheless, for purposes of illuminating and

clarifying the rule established by Borst, we note that such a

provision would not, even if properly preserved and argued,

allow for full Wis. Stat. ch. 804 discovery. Most

significantly, the language gives no indication, either by

content or context, that it speaks to discovery, let alone to

discovery preceding arbitration. Such an omission is even more

fatal juxtaposed with the fact that the policy does contain a

provision under the explicit heading of "Arbitration," a

provision that says nothing about physical examinations or

anything of the sort. For a policy to adequately describe the

discovery mechanisms to be used at arbitration it must, at the

very least, indicate in the policy that the mechanisms are in
32
 No. 2011AP2067

fact discovery mechanisms, and that they are meant to be

available at arbitration. Anything short of that plainly does

not qualify as explicit, specific, or clearly drafted, and thus

does not satisfy the Borst standard.18

¶42 Moving to the heart of the dispute, we next review the

arbitration clause itself, which provides that "[l]ocal rules of

law as to procedure and evidence will apply." The arbitration

panel thought this cursory clause "clear and informative." It

is neither, and it consequently does not come remotely close to

satisfying the bar established by Borst.
¶43 Beginning with the most obvious point, the sentence

says nothing about discovery whatsoever, let alone which

discovery rules the drafter had in mind; it mentions only

"procedure and evidence." Such broad and amorphous terms could

connote any number of things. Perhaps most problematically,

18
"[I]t is imperative" to the dissent "for the majority to
explain why the discovery sought by IDS was not explicitly
authorized" by this language in the policy. Dissent, ¶123. It
is imperative to us as well, and that is why we have explained
it in detail: because IDS is not relying on the language
(something the dissent neglects to mention) and because the
language says nothing about discovery in a policy that
specifically addresses the issue. The language may represent
"explicit, specific, and clear" guidelines, id., ¶43, but they
are far from "explicit, specific, and clear" guidelines
governing discovery, and that is precisely what the law
requires. See Borst, 291 Wis. 2d 361, ¶62 ("[T]here were no set
provisions in the insurance contract that detailed the terms of
the discovery in the arbitration. Therefore, if the parties
decide to conduct another arbitration, discovery will be limited
to depositions as detailed in Wis. Stat. § 788.07.") (emphasis
added); ¶63 ("Arbitrators have no inherent authority to dictate
the scope of discovery and absent an express agreement, the
parties are limited to" § 788.07) (emphasis added).

33
 No. 2011AP2067

they could easily be understood to relate only to the hearing

itself, not to anything that preceded it. We begin, therefore,

with the uncontested premise19 that the language in question is

ambiguous. See Folkman v. Quamme, 2003 WI 116, ¶13, 264

Wis. 2d 617, 665 N.W.2d 857 ("Insurance policy language is

ambiguous if it is susceptible to more than one reasonable

interpretation.") (citation and internal quotation marks

omitted).

¶44 The ambiguity is deepened by the fact that the phrase

"local rules of law as to procedure and evidence" does not,

contrary to the assumption shared by both IDS and the

arbitration panel, give any indication that those rules are to

be found in one particular chapter of the statutes rather than

another. In fact, the phrase gives no indication that the rules

are to be found in the statutes at all. Quite to the contrary,
"local rules" might easily and plausibly be read as a reference

to the rules of the circuit court of the county in which the

claim is brought, or the local federal district court, both of

19
In its brief, IDS repeatedly notes that the Marlowes have
"conceded" that the arbitration clause is ambiguous, and IDS
nowhere asserts that the phrase "local rules" is unambiguous.
Amicus Wisconsin Insurance Alliance likewise suggested at oral
argument that it believes the clause to be ambiguous. We
therefore assume that it is now undisputed that the clause is
ambiguous.

34
 No. 2011AP2067

which may promulgate such rules.20 See, e.g., Drow v. Schwarz,

225 Wis. 2d 362, ¶16, 592 N.W.2d 623 (1999) (referring to

circuit court rules as "local rules"); State ex rel. Mitsubishi

Heavy Indus. Am., Inc. v. Cir. Ct. for Milwaukee Cnty., 2000 WI

16, ¶37, 233 Wis. 2d 1, 605 N.W.2d 868 (Abrahamson, C.J.,

concurring) (referring to federal district court rules as "local

rules"). This possibility is especially likely given that we

read the disputed ambiguous provision, as always, within the

context of the policy as a whole. See, e.g., Wadzinski v. Auto-
Owners Ins. Co., 2012 WI 75, ¶16, 342 Wis. 2d 311, 818

N.W.2d 819. Outside the disputed arbitration clause, the policy

twice refers to Wis. Stat. ch. 34421 with specific, formal legal

citations.22 If the drafters intended to refer to ch. 804, they

20
In its opinion denying the Marlowes' motion for
reconsideration, the panel dismissed this possibility because
circuit court rules are meant only to supplement the statutes
and because the Brown County Circuit Court happened not to have
promulgated any rules regarding evidence. Neither explanation
is persuasive. A party may well want the benefit of the more
comprehensive set of procedures that court rules, in conjunction
with the statutes they supplement, provide. Moreover, policies
are presumably drafted to cover a wide range of circumstances,
and the fact that this particular dispute wound up in a circuit
court with no local rules concerning evidence is neither here
nor there when it comes to the provision's significance.
21
Wisconsin Stat. ch. 344 is a chapter of Wisconsin's
Financial Responsibility law concerning vehicles.
22
It may be instructive to note that the policy's reference
to Wis. Stat. ch. 344 is a good example of an explicit,
specific, and clearly drafted arbitration clause within the
meaning of Borst. Had the policy referred to ch. 804 in a
similar fashion, there would be no question that IDS was
entitled to employ the discovery devices described in the
chapter.

35
 No. 2011AP2067

obviously knew how to use similarly clear and comprehensible

language, rather than the opaque phrase, "local rules."23

¶45 Even if we take the considerable leap IDS asks of us

and accept, for the sake of argument, that "local rules" refers

to the Wisconsin statutes, we are still left with an even more

difficult and even more important question, the question that

lies at the root of this entire case: which statute? There is

23
Without citation or explanation, the dissent posits that
"it is not plausible that the" parties "intended to mean that
arbitrators are bound by rules of procedure and evidence
established by the circuit courts——county by county——but need
not follow the procedural and evidentiary rules embodied in
state law." Dissent, ¶130. There are two problems with this
argument. First, it proposes a choice that does not exist.
Circuit court rules cannot conflict with state law, see, e.g.,
Hefty v. Strickhouser, 2008 WI 96, ¶46, 312 Wis. 2d 530, 752
N.W.2d 820, and there is no contention here that anyone is free
to disregard the Wisconsin statutes. Second, we do not find it
so implausible that a policy might adopt local court rules
concerning arbitration discovery. Implausibility may be partly
in the eye of the beholder, but if such a tack is implausible,
there are at least a few parties around the country behaving
implausibly. See, e.g., Dan Ryan Builders, Inc. v. Nelson, 737
S.E.2d 550, 553 n.1 (W. Va. 2012) (quoting an arbitration clause
that included the provision that "[e]ach party shall be entitled
to full discovery in accordance with the local rules of court in
the event that arbitration is invoked . . . .") (emphasis
added); Shainin II, LLC v. Allen, No. C06-420P, unpublished slip
op., 2006 WL 2473495, at *8 (W.D. Wash. Aug. 28, 2006) (making
reference to arbitration agreements that "provide for discovery
'as provided by the United States Federal Rules of Civil
Procedure as modified by the Local Rules for the Western
District of Washington.'") (quoting the agreements); Sprint
Commc'ns Co. L.P. v. Mushahada Int'l USA, Inc., No. Civ.A. 05-
2168-KHV, unpublished slip op., 2005 WL 1842845, at *1 (D. Kan.
July 29, 2005) (paraphrasing an agreement which provided "that
in the event a dispute under the agreement is submitted to
arbitration . . . , any discovery would be governed by the local
rules of the District of Kansas.").

36
 No. 2011AP2067

nothing in the clause at issue even intimating that "local

rules" means Wis. Stat. ch. 804 and not Wis. Stat. § 788.07. It

is axiomatic that where a more specific law on a given subject

is potentially in conflict with a more general one on the same

subject, the former controls. See, e.g., Pruitt v. State, 16

Wis. 2d 169, 173, 114 N.W.2d 148 (1962). Although this case

presents a somewhat atypical example of that rule (because we do

not have a statutory conflict so much as uncertainty as to which

of two consistent statutes apply), we believe the canon still

cuts against IDS's interpretation. Chapter 804 applies to all

civil litigation in the Wisconsin courts. By contrast, ch. 788

applies to arbitration only. In the literal sense, then,

§ 788.07 is the local rule as respects discovery in arbitration
proceedings, if the "locality" is considered the entire state,

as IDS itself contends.24

¶46 Resisting that conclusion, the arbitration panel

wrote, in its ruling on the motion for reconsideration, that

"[t]he few courts which have interpreted the phrase [i.e.,

"local rules of law as to procedure and evidence,"] have

24
In its denial of the Marlowes' motion to reconsider, the
arbitration panel discounted the suggestion that "local rules"
could signify Wis. Stat. § 788.07 because that statute "is
certainly no more a 'local rule' than [Wis. Stat. ch.] 804 is."
We could not agree more with the premise, but we do not see how
the panel used it to draw its conclusion. If Borst means
anything, it means that there is a presumption in favor of
§ 788.07. For reasons it did not articulate, the arbitration
panel appeared to apply the opposite presumption. The question
is whether Wis. Stat. ch. 804 is "any more a 'local rule'" than
§ 788.07, not vice versa, and the answer is indisputably no.

37
 No. 2011AP2067

suggested, as this panel has, that it means the rules of civil

procedure as applied in state courts." In support, the panel

cited five cases, none of which are apposite. Beginning with

the citation least helpful to the panel's position, Workman v.

Superior Court reaches the opposite conclusion from the

arbitrators here, holding that an arbitration clause providing

that "local rules of law as to procedure and evidence" would

apply did not require compliance with the state's code of civil

procedure. 176 Cal. App. 3d 493, 501 n.3 (Ct. App. 1986).

Three of the remaining cases relied upon by the panel to

interpret the phrase "local rules" are distinguishable from the

present matter, as those cases examined only the phrase so as to

resolve disputes concerning choice of law or forum. They did

not even purport to determine whether a court statute prevailed

over an arbitration statute. See Miller v. Allstate Ins. Co.,

763 A.2d 401, 403 (Pa. Super. Ct. 2000); Costello v. Liberty

Mut. Fire Ins. Co., 876 N.E.2d 115, 120-21 (Ill. App. 2007);

Brown v. Great N. Ins. Co., No. Civ.A. 3:05-CV-1791, 2006 WL

538186, unpublished slip op. at *1-2 (M.D. Pa. Mar. 2, 2006).25

¶47 The only Wisconsin precedent cited by the arbitration

panel is just as easily distinguishable. As the arbitrators saw

it, Lukowski v. Dankert, 184 Wis. 2d 142, 515 N.W.2d 883 (1994)

25
Brown does make a passing reference to "state procedural
rules" in two cursory sentences that include no analysis or
citations, and does not, at any rate, say anything about
favoring trial procedure over arbitration procedure. Brown v.
Great N. Ins. Co., No. Civ.A. 3:05-CV-1791, 2006 WL 538186,
unpublished slip op. at *1-2 (M.D. Pa. Mar. 2, 2006).

38
 No. 2011AP2067

confirmed that "Wisconsin procedural rules" should be applied in

circumstances like these. At the risk of repeating ourselves,

Wis. Stat. § 788.07 is a Wisconsin procedural rule, as evidenced

by the fact that it is found in the same code as Wis. Stat. ch.

804. Additionally, Lukowski made only one statement regarding

"local rules of law," namely, that it created "a legitimate

expectation that the governing law would be followed and applied

properly." Id. at 152 (footnote omitted). In finding that the

panel acted within its discretion, the Lukowski court did not

suggest that there was any dispute between the parties as to

what the governing law was, the issue at the heart of the

present matter. We have no quarrel with this uncontroversial

statement by Lukowski but it is, like all of the cases cited by

the panel, off-point.26 To summarize, none of the decisions

relied upon by the panel involved a statute designed to

26
We are uncertain as to what significance the dissent
ascribes to Lukowski v. Dankert, 184 Wis. 2d 142, 515 N.W.2d 883
(1994). It includes a fairly lengthy exposition of the case,
but places it in a section denominated "Factual Background."
Dissent, ¶¶84-87. Like the arbitration panel, the dissent
emphasizes that the Lukowski court interpreted the phrase "local
rules of law as to procedure and evidence" as a reference to
Wisconsin law. Id., ¶85 ("All parties in Lukowski interpreted
this language to refer to Wisconsin law.") (emphasis in
original); id., ¶86 ("The governing law on procedure and
evidence was deemed to be Wisconsin law in statutes and
cases."). We do not disagree, but cannot perceive the relevance
of this fact. As in Lukowski, it is obvious that Wisconsin law
governs the instant matter. That gets us nowhere, however, as
the real question is which Wisconsin law. Lukowski happened to
involve the same few words in an arbitration contract, but it
did not consider any remotely similar legal question and
consequently does not assist our inquiry here.

39
 No. 2011AP2067

delineate the discovery procedures available at arbitration.

Deference to the legislature was consequently not a factor in

those cases, and it is a factor we cannot dismiss out of hand

here in light of § 788.07's clear directive.

¶48 Lastly, we consider all of the above with reference to

another well-established rule of contract law, that ambiguities

are resolved against the drafter. See, e.g., Hirschhorn v.

Auto-Owners Ins. Co., 2012 WI 20, ¶23, 338 Wis. 2d 761, 809

N.W.2d 529 ("[A]mbiguities are construed against the insurer,

the drafter of the policy.") (citations omitted). That rule has

particular force here, as Borst specifically requires the

drafter to use care in making clear its intention to resort to

arbitration discovery more expansive than that provided in Wis.

Stat. § 788.07.

¶49 In light of the foregoing, it cannot be said that the

"local rules" provision was an explicit, specific, and clearly

drafted reference to Wis. Stat. ch. 804, or to any other

discovery rules, as required by Borst. The clause was none of

40
 No. 2011AP2067

those things.27 The panel erred in ruling to the contrary, and

should instead have limited discovery to the confines of Wis.

Stat. § 788.07.

2) The Arbitration Panel Did Not Have the Exclusive Authority To

Determine the Discovery Procedure

¶50 The court of appeals held that the "local rules"

provision "arguably refers to the scope of discovery," Marlowe,

340 Wis. 2d 594, ¶27, thereby endowing the arbitration panel

with the "exclusive authority," id., ¶22, to control discovery,
free from any judicial review. To justify that conclusion, the

court of appeals misconstrued our precedent, and we therefore

hold that the panel did not have the sole power to regulate

discovery.

¶51 As with the preceding issue, our examination of the

arbitration panel's authority vis-à-vis the courts centers on

Borst. The court of appeals discerned in Borst the proposition

that the construction of an arbitration provision that "arguably

27
At oral argument, counsel for amicus Wisconsin Insurance
Alliance suggested that "express," as used in Borst, "doesn't
mean that it's not ambiguous, it means that there is some
language, direct language in the contract . . . that addresses
this issue." If that were true, the word would have no real
meaning. "Express" has a far stronger connotation: "directly
and distinctly stated or expressed rather than implied or left
to inference: not dubious or ambiguous." Webster's Third New
International Dictionary 803 (2002) (emphasis added). Of
course, the "local rules" provision was by no stretch of the
imagination "directly and distinctly stated," at least not in
any sense relating to its supposed reference to Wis. Stat. ch.
804. Thus, even under the narrowest reading of Borst's holding,
the policy would not suffice to entitle IDS to ch. 804
discovery.

41
 No. 2011AP2067

refers to the scope of discovery" lies within the exclusive

province of the panel. Marlowe, 340 Wis. 2d 594, ¶27. Borst

said no such thing. The policy at issue there was "silent as to

the terms of discovery." Borst, 291 Wis. 2d 361, ¶53. Neither

the word "arguably" nor any other synonym appears in the

decision. The Borst court declared, emphatically, "that

arbitrators have no inherent authority to dictate the scope of

discovery, and absent an express agreement to the contrary, the

parties are limited to depositions as spelled out in Chapter

788." Id., ¶56 (emphasis added). The court of appeals turned

that clear directive on its head in this case by creating a rule

that an ambiguous policy that arguably demonstrates an agreement

to go outside of Wis. Stat. § 788.07 insulates the panel's order

from judicial review. For reasons we have already surveyed, the

Borst rule is a sensible one and, at any rate, it is not for the

court of appeals to insert a qualification into our decision

that we did not place there ourselves.

¶52 Part of the court of appeals' confusion on this point

stemmed from its reading of Employers. In that case, an

arbitration agreement provided that each party was to "'submit

its case' to the arbitrators within thirty days of the

arbitrators' appointment." Employers, 202 Wis. 2d at 684.

After the thirty days elapsed, Employers sought further

discovery, which the panel declined to grant. When the matter

reached it, the court of appeals considered the question of

whether "submit its case" meant "submit all factual materials

and arguments" or just "submit all arguments." As the court of
42
 No. 2011AP2067

appeals read the agreement, if the phrase "submit its case"

signified "submit all arguments," the panel would have enjoyed

the discretion to allow discovery after the lapsing of the 30-

day deadline. In a passage that caught the attention of the

court of appeals in this case, the Employers court wrote:

Because the language in the agreement is vague and
indefinite as to exactly what procedures should be
used to arrive at that determination, it is within the
province of the arbitration panel, as the interpreter
of the contract language, to devise such procedures as
it considers necessary to reach a decision, as long as
those procedures are compatible with the contract
language and do not violate the law.

Id. at 686.
¶53 In the present matter, the court of appeals collapsed

the quoted rule from Employers with the rule articulated in

Borst, holding that "under Borst and Employers, the panel was

entitled to interpret the phrase and determine the scope of

discovery it allowed." Marlowe, 340 Wis. 2d 594, ¶27 (emphasis

added). Borst and Employers, however, set forth very different

rules, almost diametrically opposed rules, and only one applies

here. We resolved the question implicated by the dispute

between the Marlowes and IDS in Borst. That question was, in a

nutshell, what does a policy need to say in order to allow for

discovery outside of Wis. Stat. § 788.07? The answer, we

repeat, is: an explicit, specific, and clearly drafted reference

to another set of discovery guidelines. When such language is

not included in the policy, we made clear in Borst, the courts

have not just the option, but the duty to correct a panel that

43
 No. 2011AP2067

refuses to apply the statute, lest the judiciary neglects its

responsibility to enforce the duly-enacted laws of the

legislature.

¶54 Employers answered a different, narrower question,

and with substantially different facts before it: can an

arbitration panel extend the time for submissions when the

contract is ambiguous on the subject? Crucially, the court of

appeals in Employers was not addressing an issue that the

legislature had already addressed, so there was no default rule

to apply in the case of ambiguity. The court of appeals

therefore properly resorted to the more deferential standard

that governs judicial review of arbitration rulings in the

absence of any legislation on point. Equally importantly, the

arbitration clause under review in Employers informed the panel

that it was "relieved of all judicial formalities and may

abstain from following the strict rules of law," a factor the

court emphasized in its opinion. Id. at 686 ("Given the broad

power the clause gives to the panel in controlling procedure, we

will defer to its interpretation of an ambiguous phrase

regulating procedure.") (Emphasis added.)

¶55 Seen in this light, the Employers court correctly fell

back on the general principle that an arbitration panel should

have exclusive authority to dictate procedure where the

arbitration clause allows it to and where the legislature has

provided no on-point default rule. See, e.g., City of Madison,

144 Wis. 2d at 586 (holding that the courts will uphold an

arbitrator's decision on whether an award is warranted, and if
44
 No. 2011AP2067

so, its size, unless "there is a manifest disregard of the law,

or if the award itself is illegal or violates strong public

policy."). Notwithstanding the dissent's protestations to the

contrary, the panel here had no such luxury. For the

arbitration clause under consideration, far from relieving the

panel of "judicial formalities and . . . strict rules of law,"

required the panel to apply such rules, it simply did not

specify which rules. Furthermore, the legislature has addressed

the type of discovery procedure to be employed in arbitration

proceedings and we must defer to its choice. Simply put,

Employers answered a different question, under different facts,

and with far different legal considerations being brought to

bear. Both Borst and Employers were rightly decided, and there

is no tension between them. Borst controls this case, and it

requires us to instruct the panel to apply Wis. Stat. § 788.07,

as the legislature has directed.

¶56 Following a similar path to that of the court of

appeals, the dissent takes exception to our treatment of the

panel's decision, opining that we "misstate[]" the standard of

review and accord its ruling insufficient deference. Dissent,

¶¶124-132. To the dissent, the more deferential Employers-type

standard applies, and under that standard we "would be hard

pressed to argue that there is no reasonable basis for the

panel's construction of the" policy. Id., ¶130. For starters,

the question under the approach advocated by the dissent would

not be whether there was a "reasonable basis for the panel's

construction," it would be the far narrower and more restrictive
45
 No. 2011AP2067

question of whether it constituted a "perverse misconstruction."

Id., ¶133. It is true, as the dissent maintains, that the

answer would be negative, and that proves our point. Borst did

not mention, let alone employ, the "perverse misconstruction"

test. Instead, Borst taught, by example, that an arbitration

panel can order full Wis. Stat. ch. 804 discovery only when the

agreement contains an explicit, specific, and clearly drafted

clause allowing for such discovery, and that courts will reverse

where they disagree after exercising their own independent

judgment. 291 Wis. 2d 361, ¶62 ("In this case, there were no

set provisions in the insurance contract that detailed the terms

of the discovery in the arbitration. Therefore, if the parties

decide to conduct another arbitration, discovery will be limited

to depositions as detailed in Wis. Stat. § 788.07.") (footnote

omitted).

¶57 Imaginatively, the dissent endeavors to tie its

recommended standard of review to Borst itself, declaring that
it is proper "because Borst permits the scope of discovery to be

set out in the contract." Dissent, ¶128. Borst did permit as

much, but it also reversed a panel for ordering full discovery

while paying no deference to the panel's ruling. In the

pertinent section of its analysis, the Borst court did not even

mention the panel's reasoning. 291 Wis. 2d 361, ¶¶53-62.

Although Borst declared the contract "silent as to the terms of

discovery," it was debated in the briefs, the certification, and

the supreme court decision itself as to whether the policy

incorporated rules drawn up by the American Arbitration
46
 No. 2011AP2067

Association ("AAA"), which arguably would have provided some

parameters for discovery. Id., ¶62 n.10. Notably, Borst did

not discuss whether it might have been a "perverse

misconstruction" or a "manifest disregard of the law" for the

panel to rely on the AAA rules, but rather said that "there were

no set provisions in the insurance contract that detailed the

terms of the discovery in the arbitration" and that it was

"unclear which set of arbitration rules promulgated by the AAA

would be applicable." Id., ¶62 & n.10 (emphases added). These

are not the words of a court looking for a "perverse

misconstruction" or a "manifest disregard of the law." They are

the words of a court doing exactly what it purports to be doing:

evaluating, for itself, whether a policy contains an explicit,

specific, and clearly drafted discovery clause.

¶58 Perhaps most to the point, if Borst really did share

the dissent's view of the law, it would have said something

about how a panel is largely insulated from judicial review in

fashioning discovery so long as the policy contains a provision

arguably on point, but enjoys no such insulation when the policy

is silent. It would have been wholly unnecessary to set a bar

for how a policy should address discovery. What is more, it

would be especially odd to set that bar with reference to its

own judicial analysis, rather than with reference to the

arbitration panels that supposedly enjoy an almost unlimited

freedom to interpret discovery clauses as they see fit. Surely

the seven members of the Borst court would have foreseen that

their opinion would be taken at face value, and that the
47
 No. 2011AP2067

Wisconsin courts, our own included, would obey its instructions,

which offer no inkling that they are directed only at

arbitration panels and not also at the judiciary. Those

instructions are to look for explicit, specific, and clearly

drafted discovery clauses, and we follow them today. As before,

the dissent's critique of our standard of review is in reality a

call to overrule Borst, using one element of the decision, taken

out of context, as a reason to eviscerate the rest of it. We

are not persuaded by the call, and do not overrule Borst, either
explicitly or, as the dissent requests, sub silentio.

¶59 As a final point, it warrants mention that Borst's

requirement is far from onerous and that there is no reason to

fear the dissent's dark warnings about the dire consequences to

arbitration let loose by our decision. Dissent, ¶88 ("[T]he

majority opinion undercuts the contractual authority of

arbitrators and creates a serious disincentive for parties to

agree to arbitration."); ¶123 (under the majority decision,

"insurers will face a powerful disincentive to agree to

arbitration, and the arbitration of contractual disputes will

suffer a major setback."). Had IDS wanted the benefit of Wis.

Stat. ch. 804 discovery, it could simply have said, in the

policy it drafted, "discovery will be governed by Wis. Stat. ch.

48
 No. 2011AP2067

804," or any number of equally clear and concise alternatives.28

Unlike the dissent, we do not believe contract-drafters are so

unskilled in their craft that the demand for these nine simple

words or other equally straightforward formulations poses any

danger of "supersed[ing] the parties' intentions." Id., ¶114.29

Borst placed IDS, along with all other Wisconsin insurers, on

notice that ambiguous provisions would not suffice to grant

recourse to expansive ch. 804 discovery. Such a modest demand

for clarity is not too much to ask when the legislature has

unequivocally expressed its own reasonable preference on the

matter.

IV. CONCLUSION

28
At the hearing where it announced its ruling, the circuit
court opined that the Marlowes would "be in the mud if [the
arbitration clause] said local discovery rules," rather than
just "local rules of law as to procedure and evidence."
(Emphasis added). We respectfully disagree. As stated, Wis.
Stat. § 788.07 is as much a "local discovery rule" as Wis. Stat.
ch. 804. Indeed, it is more of a local discovery rule as
respects arbitration than ch. 804, which says nothing about
arbitration. The phrase "local discovery rules" would have
suffered from the same fatal ambiguity as the phrase IDS
selected.
29
If the call we first issued in Borst and now reiterate
today——for clear statements about the scope of discovery in
arbitration agreements——does in fact have an adverse impact on
the ability of an insurer to resolve disputes in arbitration, as
the dissent worries, one can only conclude that it is because
the insured is hesitant to consent to the type of discovery
desired by the insurance company. And if that is the case, it
would not be so regrettable as the dissent alleges for fewer
claims to be arbitrated, as the reduction would simply reflect a
greater number of parties knowledgeably exercising their
independent bargaining power, a change we should welcome, not
dread.

49
 No. 2011AP2067

¶60 We consider two issues: 1) whether the Marlowes were

permitted to seek a declaratory judgment concerning the

discovery dispute before the arbitration panel ruled on whether

an award was appropriate and, if so, its amount; and 2) whether

the panel properly established discovery procedures outside

those outlined in Wis. Stat. § 788.07. Because no unusual

circumstances justified an interlocutory appeal, we hold that

the Marlowes' action in circuit court was premature. As to the

second question, the legislature has set forth, in the form of

§ 788.07, a narrow scope of discovery for arbitration

proceedings in the absence of an explicit, specific, and clearly

drafted arbitration clause to the contrary. IDS failed to

include any such language in its policy and we therefore

instruct the panel to limit discovery to that provided for in

§ 788.07. Accordingly, we affirm the court of appeals insofar

as it declined to allow the Marlowes an interlocutory appeal.

However, insofar as the court of appeals granted IDS the benefit

of full Wis. Stat. ch. 804 discovery, we modify its decision and
instead direct the panel to cabin discovery to the depositions

contemplated in § 788.07. Thus, the decision of the court of
appeals is modified, and as modified, affirmed, and the cause is

remanded to the arbitration panel with instructions.
By the Court.—The decision of the court of appeals is

modified and affirmed, and, as modified, the cause is remanded
to the arbitration panel with instructions.

50
 No. 2011AP2067

51
 No. 2011AP2067.ssa

¶61 SHIRLEY S. ABRAHAMSON, C.J. (concurring). I agree

with the majority opinion's conclusion that Wis. Stat. § 788.07

sets forth a narrow scope of discovery for arbitration

proceedings in the absence of an explicit, specific, and clearly

drafted arbitration clause to the contrary.

¶62 I also agree with the majority opinion's conclusion

that parties to an arbitration can seek judicial intervention

prior to the arbitrators' rendering an award only under special

circumstances. These special circumstances are variously

described in the majority opinion as "unusual circumstances,"

"compelling reason(s)," circumstances that "subject the

aggrieved party to irreparable harm," "urgent or potentially

irreparably prejudicial matters that demand the immediate

attention of the courts," "especially urgent" circumstances, and

circumstances that pose a "threat of irreparable harm."

Majority op., ¶¶2, 20, 21, 60.

¶63 The majority then applies this rule to the present

case and concludes that the Marlowes' action in the circuit

court (and here) was premature because "no unusual circumstances

justified an interlocutory appeal." Majority op., ¶¶2, 11, 22,

60.

¶64 Indeed, the majority goes so far as to say that the

Marlowes did not suggest that the discovery dispute at

arbitration was unusual in such a way as to justify intermediate

intervention by the circuit court. Majority op., ¶21. On the

contrary, the Marlowes made the logical and convincing argument

that the arbitration panel's erroneous grant of broad discovery

1
 No. 2011AP2067.ssa

subjected them to the full-blown, time-consuming and costly

burdens of litigation without the benefit of a jury trial and

without an adequate remedy.

¶65 The majority decides at ¶21 that the Marlowes'

judicial action is premature. As a matter of logic, the opinion

should end there. Surprisingly, it does not. It goes on for

another 39 paragraphs grappling with numerous issues, some

briefed and some not briefed.

¶66 The majority opinion's reasoning is internally

inconsistent. Or, as the majority opinion prefers to put it, it

"seems at first blush incongruous" to hold that Marlowe's court

action is premature and no relief should be granted and then to

give Marlowe the relief requested. Majority op., ¶22.

¶67 The inconsistency, or if you prefer, the "incongruity

at first," second, or third blush, is evident because the

reasons the majority uses to justify its deciding the

substantive discovery issue also justify judicial intervention

by the circuit court according to the rule set forth in the

majority opinion: the case presents "special circumstances,"

"unusual or especially urgent circumstances," and "compelling

reasons."

¶68 And what are the special, unusual or especially urgent

circumstances or compelling reasons the majority gives for

deciding the substantive issue in this premature action? To use

the majority opinion's own words, if we did not decide this

issue,

we would allow an erroneous rule to retain the force
of law, not only in this case, but in all others.
2
 No. 2011AP2067.ssa

Moreover, further delay of the issue's ultimate
resolution would impede even further the efficient
disposition the parties bargained for by agreeing to
arbitration. Lastly, we will be required to answer
the important question presented by the discovery
dispute sooner or later. It would only frustrate
judicial economy were we to unnecessarily put the
question off for another day, particularly when we
would thereby cause arbitration in this case to
proceed under the wrong statute in violation of a
clear legislative dictate.
Majority op., ¶22 (emphasis added).

¶69 Prohibiting the Marlowes from obtaining immediate

judicial intervention at the circuit court on a clearly

erroneous arbitration decision relating to discovery, to use the

words of the majority opinion, "would allow an erroneous rule"

to have the force of law in the Marlowes' case; would cause

"further delay of the issue's ultimate resolution"; "would

impede even further the efficient disposition the parties

bargained for by agreeing to arbitration"; "would frustrate

judicial economy"; and would "cause arbitration . . . to proceed

under the wrong statute in violation of a clear legislative

dictate." Furthermore, the circuit court "will be required to
answer the important question presented by the discovery dispute

sooner or later." Majority op., ¶22.
¶70 For the very reasoning and analysis set forth in the

majority opinion, I conclude that the Marlowe matter presents
special circumstances and that the adjudication was not

premature at the circuit court or here.
¶71 For the reasons set forth, I write separately.

¶72 I am authorized to state that Justice ANN WALSH
BRADLEY joins this opinion.

3
 No. 2011AP2067.dtp

¶73 DAVID T. PROSSER, J. (concurring in part, dissenting

in part). The court of appeals reversed the circuit court,

concluding that a party in an arbitration "generally may not

seek immediate circuit court review of an arbitration panel's

intermediate decision. Instead, the party must wait and

challenge that decision by seeking to vacate the panel's final

award, pursuant to Wis. Stat. § 788.10."1 The majority opinion

affirms this determination, and I join that portion of the
majority opinion that discusses the issue under the heading "The

Interlocutory Appeal."

¶74 The court of appeals also reversed the circuit court

by approving the arbitration panel's interpretation of a

sentence in the arbitration provision of an insurance contract

that arguably related to discovery. The majority opinion

rejects this part of the court of appeals determination.

Although I do not necessarily agree with all the language in the

court of appeals opinion, I believe the holding on the second

issue was essentially correct. Because the majority opinion

comes to a different conclusion, I respectfully dissent from

"The Discovery Dispute" portion of the opinion.

I. FACTUAL BACKGROUND

¶75 Mary and Leslie Marlowe (the Marlowes) were involved

in an automobile accident with an uninsured motorist. They made

a claim for uninsured motorist coverage from their insurer, IDS

Property Casualty Insurance Company (IDS). The Marlowes and IDS

1
Marlowe v. IDS Prop. Cas. Ins. Co., 2012 WI App 51, ¶18,
340 Wis. 2d 594, 811 N.W.2d 894 (footnote omitted).

1
 No. 2011AP2067.dtp

agreed to arbitrate the claim as provided in the Marlowes'

insurance policy, and thereafter a three-member arbitration

panel was selected.

¶76 A discovery dispute soon developed. IDS says that it

sought discovery "to verify the existence and extent of the

Plaintiffs' various alleged injuries." It explained that:

Such discovery is necessary because it goes to the
essence of the claims that the Marlowes have put in
issue, namely the existence and extent of their
alleged injuries. The alleged injuries arise from a
rear-end vehicle accident with minimal damage to the
vehicle, but with claimed medical specials already
exceeding $60,000.00, and with a claim for permanent
injury.
¶77 The Marlowes asserted in the complaint that started

this case that IDS "attempted to pursue discovery of the

plaintiffs through the use of written interrogatories, requests

for production of documents, medical and employment

authorizations, income tax return releases, depositions of the

plaintiffs and treating healthcare providers, and defense

medical examinations." IDS admitted these allegations in its

answer.

¶78 The Marlowes refused to comply with IDS's discovery

demands.

¶79 IDS then asked the arbitration panel to interpret

language in the arbitration provision in relation to the

discovery dispute. IDS claimed that a sentence in the

provision——namely, "Local rules of law as to procedure and

evidence will apply"——authorized discovery pursuant to the

procedures in Wis. Stat. ch. 804, which is the chapter, in
2
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Wisconsin's code of civil procedure, on "Depositions and

Discovery."

¶80 In October 2010 the arbitration panel issued a

unanimous decision interpreting the "Local rules of law"

sentence as applying to Chapter 804 of the Wisconsin Statutes.

The panel recognized that this court's decision in Borst v.

Allstate Insurance Co., 2006 WI 70, 291 Wis. 2d 361, 717

N.W.2d 42, "drastically circumscribe[d] the discovery that can
be taken in arbitration proceedings." However, the panel relied

upon an approved exception to the limited-discovery rule that

permits expanded discovery when the parties' contract expressly

provides for it. The panel concluded that the "Local rules of

law" sentence denoted "the civil rules of procedure that govern

court proceedings daily in local courtrooms." The panel

asserted that Chapter 804 does "not contemplate unfettered

discovery" but rather "discovery that is quick and efficient,

but cost effective." The panel put limitations on future

depositions and noted that a formal advance order would be

required for any physical examination of Mary Marlowe.

¶81 Significantly, the arbitration panel declared:

"Nothing in Borst, or any other decision cited, deprives the
panel of authority to implement the clear terms of the agreement

that govern the parties' relationship. Indeed, that is the

panel's responsibility."

¶82 Through their attorneys, the Marlowes filed a lengthy

and well-argued letter brief seeking reconsideration of the

panel's decision. Many of the points made in the brief are
3
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adopted by the majority opinion. However, the Marlowes' brief

conceded that the panel's "construction of this ambiguous policy

language is one that could be reasonably made."

¶83 The panel responded by issuing a supplementary

decision affirming its ruling and answering the points in the

Marlowes' brief. The supplementary decision relied in part on

Lukowski v. Dankert, 184 Wis. 2d 142, 515 N.W.2d 883 (1994).

¶84 In Lukowski, the plaintiff suffered personal injuries
when the truck in which she was riding overturned and she was

ejected through the sunroof. Id. at 146. When the plaintiff

made a claim against her insurer for uninsured motorist

coverage, her claim was submitted to arbitration. Id. at 146–

47. The arbitration panel determined the full extent of the

plaintiff's damages but reduced her award by 40 percent because

the plaintiff had not been wearing a seatbelt. Id. at 147. In

other words, the panel found the plaintiff 40 percent causally

negligent for her injuries——and it did so without expert

testimony presented by the insurer, as was normally required

under Wisconsin case law. Id. at 147–48.

¶85 Ms. Lukowski's insurance policy contained the

identical language contained in the Marlowes' policy: "Local

rules of law as to procedure and evidence will apply."2 Id. at

152. All parties in Lukowski interpreted this language to refer

to Wisconsin law. The plaintiff asserted that the arbitration

2
The "Local rules of law" language was not present in the
policy at issue in Borst v. Allstate Insurance Co., 2006 WI 70,
291 Wis. 2d 361, 717 N.W.2d 42.

4
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panel had not followed Wisconsin case law. Id. at 151. The

insurer insisted that the panel had acknowledged Wisconsin law

but distinguished the plaintiff's case from other cases on

grounds that expert testimony was not required when a party's

injuries resulted from her ejection from the vehicle because she

did not wear a seatbelt.

¶86 This court ratified the parties' interpretation of the

sentence on "Local rules of law": "[T]he parties had a
legitimate expectation that the governing law would be followed

and applied properly." Id. at 152 (footnote omitted). The
governing law on procedure and evidence was deemed to be

Wisconsin law in statutes and cases. See id. at 154.

¶87 In the present case, the arbitration panel construed

the "Local rules of law" sentence the same as the arbitration

panel, the court of appeals, and this court had construed it in

Lukowski. The Brown County Circuit Court overturned the panel's

construction, and the court of appeals then reversed the circuit

court. The majority now sides with the circuit court.

II. DISCUSSION

¶88 The majority opinion is grounded on the premise that

arbitrations are different from civil court trials. This

premise is unassailable. However, the majority uses the premise

to severely restrict arbitration discovery not only under the

arbitration statutes but also under the parties' insurance

contract——notwithstanding applicable language to the contrary.

In the process, the majority opinion undercuts the contractual

authority of arbitrators and creates a serious disincentive for
5
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parties to agree to arbitration. In sum, despite its good

intentions, the majority opinion goes too far.

A. The Borst Certification

¶89 In the Borst case, the court of appeals certified

three questions including the following: "Other than the

deposition procedure outlined in Wis. Stat. § 788.07, is the

nature and extent of discovery during the arbitration process

governed by contract, the arbitrators' inherent authority, or a
combination of the two?" Borst, 291 Wis. 2d 361, ¶2. The Borst
court summarized its answer as follows: "Arbitrators have no

inherent authority to dictate the scope of discovery, and absent

an express agreement, the parties are limited to the procedure

for depositions, as described in Wis. Stat. § 788.07." Id., ¶3.

¶90 The question posed in the Borst certification was

provocative because of its reference to the "inherent authority"

of arbitrators. In Lukowski, the court had declared that "[a]n

arbitrator obtains authority only from the contract of the

parties and therefore is confined to the interpretation of that

contract." Lukowski, 184 Wis. 2d at 152; see also Nicolet High

Sch. Dist. v. Nicolet Educ. Ass'n, 118 Wis. 2d 707, 714, 348

N.W.2d 175 (1984); Milwaukee Prof'l Firefighters, Local 215 v.

City of Milwaukee, 78 Wis. 2d 1, 21, 253 N.W.2d 481 (1977).

Thus, the certified question posited an option that this court

had rejected repeatedly.

¶91 The certified question appears to have diverted the

court's attention from the possibility that the arbitration

statutes themselves provide authority for other discovery, and
6
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led to the court's creation of non-statutory obstacles for

arbitrators in construing contracts that provide for

arbitration. These conclusions are admittedly much clearer to

me in hindsight than they were when I joined the Borst opinion

in 2006. They require explanation.

B. The Borst Decision

¶92 Looking solely at the arbitration statutes, one

perceives two sections that bear on discovery: Wis. Stat.
§§ 788.06 and 788.07. All the attention has been focused on

§ 788.07, which reads:

Depositions. Upon petition, approved by the
arbitrators or by a majority of them, any court of
record in and for the county in which such
arbitrators, or a majority of them, are sitting may
direct the taking of depositions to be used as
evidence before the arbitrators, in the same manner
and for the same reasons as provided by law for the
taking of depositions in suits or proceedings pending
in the courts of record in this state.
¶93 The Borst court explained the factual background of
that case when it interpreted Wis. Stat. § 788.07. Plaintiff

Borst was injured in an accident with an uninsured motorist.

Borst, 291 Wis. 2d 361, ¶5. The insurer believed that Borst was

50 percent liable for the accident. Id., ¶6. It requested that

all medical records related to the plaintiff's claim be

transmitted to it after Borst finished his treatment. Id.

Borst provided these records as well as records of his wage

loss. Id., ¶7.

¶94 After an arbitration panel was created, Allstate

served Borst with "a set of written interrogatories, a request

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for document production, and medical authorizations." Id., ¶10.

These requests were resisted and challenged in a motion to the

arbitration panel to quash the discovery. Id. Allstate then

raised the stakes, asking the panel to approve a deposition and

to authorize a release of records. Id. The panel ultimately

ordered Borst to (1) give a deposition, (2) supply medical

authorizations, and (3) cooperate with other appropriate

discovery. Id. In its argument to the panel, Allstate relied
heavily on the proof of claim provisions in the insurance

policy. Id.

¶95 Borst refused to submit to a deposition, and Allstate

elected not to press that issue, although it did not waive its

"right" to a deposition of Borst. Id., ¶11. It did depose the

other driver involved in the accident, while Borst provided a

list of damages and confirmed the accuracy of all pre-

arbitration discovery. Id.

¶96 The Borst court summarized the parties' arguments:

Borst essentially contends that discovery in
arbitration is the exception and not the rule. Borst
argues that in an arbitration of a first party
insurance claim, and absent extraordinary
circumstances, the parties should simply submit their
cases to the arbitrators. Unfettered discovery, Borst
argues, defeats the general purposes of arbitration to
be faster, less formal, and less expensive. . . .
Furthermore, in this particular case, Borst maintains
that there was no real need for discovery, given that
there was no claim of permanent injury, the medical
records and bills had been supplied, and Allstate
claimed to have fully assessed liability before it
made its offer [of $5,000 to settle the case].
Id., ¶54 (emphasis added).

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¶97 Allstate argued that inasmuch as the legislature

allowed for the taking of depositions during arbitration, it

must have allowed for other less costly forms of discovery and

that arbitrators should have discretion, based on their

evaluation of the facts of the case, to determine the extent of

the discovery permitted. Id., ¶55.

¶98 The Borst court then said:

We conclude that arbitrators have no inherent
authority to dictate the scope of discovery, and
absent an express agreement to the contrary, the
parties are limited to depositions as spelled out in
Chapter 788. . . .

In our view, arbitrators do not have the inherent
authority to determine the necessity and scope of
discovery allowed because, quite simply, there is no
statutory authority providing for discovery outside of
the procedures for depositions enumerated in Wis.
Stat. § 788.07.
Id., ¶¶56–57.

¶99 The court asserted that Wis. Stat. § 788.07 did not

speak to "interrogatories, requests for production, or medical

authorizations. Indeed, even looking beyond this particular

section, the Wisconsin Arbitration Act does not speak to any

other form of discovery." Id., ¶58.3

3
Attorney Mark Frankel submitted an amicus brief in the
Borst case on behalf of the Alternative Dispute Resolution (ADR)
Section of the State Bar of Wisconsin. After the Borst decision
was issued, Frankel wrote an analysis of the case for the
Wisconsin Lawyer, observing that Borst's holding that
"arbitrators have no inherent ability to determine the necessity
and scope of allowable discovery" was a "surprise" to many
practitioners in the field of ADR. Mark A. Frankel, Borst
Clarifies Arbitration Procedures, Wis. Law., Dec. 2006, at 8,
11.

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¶100 There is no dispute that the Borst case is the

controlling law in Wisconsin and applies here unless it is

clarified, modified, or distinguished on the facts. In my view,

this court should pursue all these options.

C. The Applicable Statutes

¶101 The court should carefully review Borst's

interpretation of the arbitration statutes vis-á-vis discovery.

Borst did not consider any alternative interpretation of Wis.
Stat. § 788.07 and it did not interpret Wis. Stat. § 788.06 at

all.

¶102 Wisconsin Stat. § 788.07, by its terms, requires a

party to petition for a deposition. The petition must be

"approved by the arbitrators or by a majority of them," and then

submitted to "any court of record in and for the county in which

such arbitrators . . . are sitting." Wis. Stat. § 788.07. The

statute appears to set up a very rigorous process for obtaining

the deposition of either a party or a non-party because it

requires the party seeking a deposition to go to court.

¶103 In Employers Insurance of Wausau v. Jackson, 190

Wis. 2d 597, 610, 613, 527 N.W.2d 681 (1995), this court

observed that the basic tenet of arbitration is avoiding the

courts. Thus, Wis. Stat. § 788.07 can be viewed as setting up a

barrier to one of the most intrusive and expensive forms of

10
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discovery, rather than precluding less costly forms that might

obviate the need for a deposition.4

¶104 This alternative view of the statute is arguably

inconsistent with the doctrine of expressio unius est exclusio

alterius ("the express mention of one matter excludes other

similar matters [that are] not mentioned"). See FAS, LLC v.

Town of Bass Lake, 2007 WI 73, ¶27, 301 Wis. 2d 321, 733

N.W.2d 287. But it is perfectly consistent with insurance
contracts that give an insurer broad authority to obtain "proof

of claim" information from its insured in processing a claim.5

That form of "discovery" does not require statutory authority.

In my view, it is difficult to explain why the law would permit

depositions but prohibit more modest, less costly means of

obtaining pre-hearing discovery.6

¶105 This alternative view also is consistent with a

reasonable interpretation of Wis. Stat. § 788.06(2), a provision

of the arbitration statutes that has heretofore been ignored.

That subsection provides:

4
See Carlson Heating, Inc. v. Onchuck, 104 Wis. 2d 175,
180, 311 N.W.2d 673 (Ct. App. 1981) (stating that adequate
preparation by counsel, "with full knowledge of the facts before
them[,]" will result in more orderly trials and in many
instances will avoid needless trials). The same principle
applies to depositions and to arbitration hearings.
5
See subpart D, infra.
6
Query: Does Wis. Stat. § 788.07 contemplate depositions
upon written questions, as authorized under Wis. Stat. § 804.06?
If it does, why would interrogatories be prohibited?

11
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(2) Any arbitrator may issue a subpoena under
ch. 885 or may furnish blank forms therefor to a
representative for any party to the arbitration. The
representative may issue a subpoena under s. 805.07.
The arbitrator or representative who issues the
subpoena shall sign the subpoena and provide that the
subpoena is served as prescribed in s. 805.07(5). If
any person so served neglects or refuses to obey the
subpoena, the issuing party may petition the circuit
court for the county in which the hearing is held to
impose a remedial sanction under ch. 785 in the same
manner provided for witnesses in circuit court.
Witnesses and interpreters attending before an
arbitration shall receive fees as prescribed in s.
814.67.
¶106 The majority contends that neither an arbitrator nor

the representative of a party may issue a subpoena or a subpoena

duces tecum for anything connected with discovery. Majority

op., ¶34. It contends that all subpoenas issued under Wis.

Stat. § 788.06 must be for the hearing itself. Id. This makes

little sense. The attendance of witnesses at a deposition may

be compelled by subpoena. Wis. Stat. §§ 804.05(1), 805.07. A

subpoena may be served requiring a person to produce designated

materials. Wis. Stat. § 804.05(2)–(3). Although a deposition

may proceed without a subpoena, a subpoena may be necessary if a

witness fails to comply with other notice. If a subpoena may be

issued for a deposition, then Wis. Stat. § 788.06 is not limited

to subpoenas for hearings.7

7
The title of Wis. Stat. § 788.06——"Hearings before
arbitrators; procedure"——covers two subsections, the first
subsection related to hearings and the second subsection related
to procedure. The procedure applies to more than hearings
because of the references to Wis. Stat. § 805.07.

12
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¶107 Wisconsin Stat. § 788.06 twice refers to Wis. Stat.

§ 805.07, which specifically includes subpoenas for depositions,

§ 805.07(1), as well as subpoenas requiring the production of

materials such as books, papers, and documents, § 805.07(2).

Section 788.06 also provides that if a subpoena is not obeyed,

"the issuing party [that is, the party that issued the subpoena]

may petition the circuit court for the county in which the

hearing is held to impose a remedial sanction." (Emphasis
added.) The emphasized language implies that the circuit court

does not normally issue the subpoena for a deposition. In

addition, it would be curious if arbitrators who had issued

subpoenas for the hearing had to petition the circuit court for
a remedy if their subpoenas were not obeyed.

¶108 The present Wis. Stat. § 788.06 became law in 1986.

See 1985 Wis. Act 168. The revised law, championed by the

Wisconsin Judicial Council, created a much more expansive

subpoena provision than the previous statute and was intended to

"conform[] arbitration subpoena practice to that followed in

circuit court." Judicial Council Committee Note, 1985, Wis.

Stat. § 788.06. Subpoena practice in circuit court includes

discovery.

¶109 Once again, the present section refers twice to Wis.

Stat. § 805.07; the previous section, Wis. Stat. § 788.06 (1983–

84), made no such reference. The present section extends the

subpoena power to the representative of a party (including but

not limited to an attorney), in addition to arbitrators. The

present section is not limited by its terms to the hearing, as
13
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the previous section was.8 In short, the majority's conclusion

that the statute applies only to subpoenas for hearings is

strained at best.

¶110 The previous Wis. Stat. § 788.06 mirrored 9 U.S.C.

§ 7, which is narrowly written.9 Nonetheless, § 7 of the Federal

8
Wisconsin Stat. 788.06 (1983–84) provided:

When more than one arbitrator is agreed to, all
the arbitrators shall sit at the hearing of the case
unless, by consent in writing, all parties shall agree
to proceed with the hearing with a less number. The
arbitrators selected either as prescribed in this
chapter or otherwise, or a majority of them, may
summon in writing any person to attend before them or
any of them as a witness and in a proper case to bring
with the person any book, record, document or paper
which may be deemed material as evidence in the case.
The fees for such attendance shall be the same as the
fees of witnesses in courts of general jurisdiction.
The summons shall issue in the name of the arbitrator
or arbitrators, or a majority of them, and shall be
signed by the arbitrator or arbitrators, or a majority
of them, and shall be directed to the said person and
shall be served in the same manner as subpoenas to
appear and testify before the court; if any person or
persons so summoned to testify shall refuse or neglect
to obey said summons, upon petition the court in and
for the county in which such arbitrators, or a
majority of them, are sitting may compel the
attendance of such person or persons before said
arbitrator or arbitrators, or punish said person or
persons for contempt in the same manner now provided
for securing the attendance of witnesses or their
punishment for neglect or refusal to attend in the
courts of this state.

(Emphasis added.)
9
9 U.S.C. § 7 provides:

The arbitrators selected either as prescribed in
this title or otherwise, or a majority of them, may
summon in writing any person to attend before them or
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Arbitration Act has been interpreted to permit discovery, unless

the discovery involves non-parties.10 This could explain why

Wis. Stat. § 788.07, which has no parallel in the Federal

Arbitration Act, was created——namely, to make depositions more

difficult to obtain than other discovery.

¶111 In sum, Borst's interpretation of Wis. Stat. § 788.07

created a restrictive rule, but that rule disregarded the

adjacent statute and may have misinterpreted the purpose of the
deposition statute.

any of them as a witness and in a proper case to bring
with him or them any book, record, document, or paper
which may be deemed material as evidence in the case.
The fees for such attendance shall be the same as the
fees of witnesses before masters of the United States
courts. Said summons shall issue in the name of the
arbitrator or arbitrators, or a majority of them, and
shall be signed by the arbitrators, or a majority of
them, and shall be directed to the said person and
shall be served in the same manner as subpoenas to
appear and testify before the court; if any person or
persons so summoned to testify shall refuse or neglect
to obey said summons, upon petition the United States
district court for the district in which such
arbitrators, or a majority of them, are sitting may
compel the attendance of such person or persons before
said arbitrator or arbitrators, or punish said person
or persons for contempt in the same manner provided by
law for securing the attendance of witnesses or their
punishment for neglect or refusal to attend in the
courts of the United States.
10
See, e.g., Life Receivables Trust v. Syndicate 102 at
Lloyd's of London, 549 F.3d 210 (2d Cir. 2008); Stanton v. Paine
Webber Jackson & Curtis, Inc., 685 F. Supp. 1241 (S.D. Fla.
1988); Gabriel Herrmann, Note, Discovering Policy Under the
Federal Arbitration Act, 88 Cornell L. Rev. 779, 791–92 (2003)
("[C]ourts have generally construed [§ 7 of the Federal
Arbitration Act] as granting arbitrators the power to order the
parties to submit to pre-hearing discovery.").

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D. Insurance Contract Provisions

¶112 The Borst case does not explain the relationship

between statutory authority for discovery in an arbitration

proceeding and contractual provisions that require an insured to

provide information to its insurer. In Borst, the plaintiff's

medical records and bills and wage loss records were supplied to

the insurer. Borst, 291 Wis. 2d 361, ¶¶7, 54. Borst's initial

position was to resist a deposition, which was clearly
authorized by statute. The Borst court stated that "absent a
contractual provision specifying how discovery will be handled,

the parties are limited to the discovery procedures provided in

the statutes." Id., ¶59. But the decision does not explain

whether contractual provisions requiring such items as medical

records and even a medical examination are included in

"discovery."

¶113 The majority opinion in this case goes beyond Borst

because it appears to nullify clear and sensible requirements in

the insurance contract for the insured to supply information to

the insurer in those situations where the parties agree to

arbitration. The majority directs the arbitration panel, on

remand, "to cabin discovery to the depositions contemplated in

§ 788.07, i.e., 'depositions to be used as evidence before the

arbitrators.'" Majority op., ¶2; see also id., ¶11 ("[W]e

return the action to the panel with instructions to limit

discovery to the section enacted by the legislature for

precisely these situations: Wis. Stat. § 788.07."); id., ¶23

("[W]e instruct the arbitration panel to limit discovery to that
16
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provided for in Wis. Stat. § 788.07."). The majority opinion

sums up its second holding:

[T]he legislature has set forth, in the form of
§ 788.07, a narrow scope of discovery for arbitration
proceedings in the absence of an explicit, specific,
and clearly drafted arbitration clause to the
contrary. IDS failed to include any such language in
its policy and we therefore instruct the panel to
limit discovery to that provided for in § 788.07.
Id., ¶2 (emphasis added).

¶114 The majority opinion appears to preclude the insurer

from resorting to any provision outside the arbitration section
of the insurance contract to obtain information that may be used

to prepare for a possible arbitration hearing, i.e., prehearing

discovery. Moreover, its tough new conditions——"explicit,

specific, and clearly drafted" authority in the arbitration

clause——provide a test that may supersede the parties'

intentions.

¶115 The IDS insurance contract with the Marlowes is

explicit, specific, and clear in this case:

What To Do In Case Of An Auto Accident Or Loss

. . . .

1. We must be notified promptly of how, when
and where the accident or loss happened. Notice
should also include the names and addresses of any
injured persons and any witnesses.

2. A person seeking any coverage must:

a. Cooperate with us in the investigation,
settlement or defense of any claim or suit.

. . . .

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 No. 2011AP2067.dtp

c. Submit, as often as we reasonably
require:

(1) To physical exams by physicians we
select. We will pay for these exams.

(2) To answer questions under oath
when asked and by anyone we name. They shall do so
separately, outside the presence of any other person
who may be requested to answer questions under oath in
connection with the loss. They must also sign copies
of the answers.

d. Authorize us to obtain medical reports
and other pertinent records.

e. Submit a proof of loss when required by
us.

. . . .

Medical Expense Coverage

We will pay reasonable expenses for necessary
medical (including chiropractic) . . . services
incurred because of bodily injury sustained by an
insured and caused by an accident.

. . . .

We have the right to:

1. Obtain and use:

a. Peer reviews; and

b. Medical bill reviews

of the medical expenses and services to determine if
they are reasonable and necessary for the bodily
injury sustained.

2. Use a medical examination of the injured
person to determine if:

a. The bodily injury was caused by a motor
vehicle accident; and

18
 No. 2011AP2067.dtp

b. The medical expenses and services are
reasonable and necessary for the bodily injury
sustained.
¶116 Here, IDS sought:

(a) written interrogatories.

(b) requests for production of documents.

(c) medical and employment authorizations.

(d) income tax return releases.

(e) depositions of the plaintiff.

(f) depositions of treating healthcare providers.

(g) defense medical examinations.

¶117 Depositions of the plaintiffs and of the treating

healthcare providers are explicitly authorized by Wis. Stat.

§ 788.07.

¶118 A defense medical examination is authorized by the

contractual requirements to submit to "physical exams by

physicians we select" and "a medical examination of the injured

person."

¶119 Requests for production of documents and "medical and

employment authorizations" appear to overlap. These demands are

grounded in the contractual authority "to obtain medical reports

and other pertinent records," "proof of loss," and "[m]edical

bill reviews."

¶120 Requests for income tax return releases may be related

to plaintiff's medical expense deductions and/or plaintiff's
income over time. Such returns would have to be relevant and

might require justification to the arbitrators but they are

certainly not irrelevant per se.

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¶121 Written interrogatories can be construed as falling

under the requirement to "answer questions under oath when

asked."

¶122 This case is factually different from the Borst case.

Plaintiff Borst maintained that "there was no real need for

discovery, given that there was no claim of permanent injury,

the medical records and bills had been supplied, and Allstate

claimed to have fully assessed liability" before it made a
settlement offer. See ¶96, supra. Here, purportedly, there is
a claim of permanent injury, and a request for medical records

and bills that have not been supplied; furthermore, causation is

at issue. See ¶76, supra.

¶123 Consequently, I believe it is imperative for the

majority to explain why the discovery sought by IDS was not

explicitly authorized by the insurance contract. If an

insurer's agreement to participate in arbitration serves to

nullify the insurer's contractual rights to obtain information

from its insured, insurers will face a powerful disincentive to

agree to arbitration, and the arbitration of contractual

disputes will suffer a major setback.

E. Standard of Review

¶124 There is one additional concern. I believe the

majority opinion misstates the standard of review in relation to

the arbitration panel's discussion of discovery.

¶125 The arbitration panel based its discovery ruling on a

sentence in the arbitration provision of the insurance contract,

namely, "Local rules of law as to procedure and evidence will
20
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apply." As the majority opinion notes, the panel declared that:

"The term 'local rules of [law as to] procedure[,'] as the

policy employs it, is both clear and informative. It denotes

the civil rules of procedure that govern court proceedings daily

in local courtrooms." Majority op., ¶5. The panel added that,

"If the purpose of arbitration is to achieve an expedited,

efficient decision that ultimately determines the truth, more,

not less, preparation for hearing is the most sensible way to
achieve that, a goal the contract contemplates."

¶126 When an arbitration panel interprets a provision in an

applicable contract, the panel's interpretation should be

afforded some deference in review by a court. Such deference is

captured by the concept of "perverse misconstruction."

¶127 "Courts will vacate an award when arbitrators exceeded

their powers through 'perverse misconstruction,' positive

misconduct, a manifest disregard of the law, or when the award

is illegal or in violation of strong public policy." Baldwin-
Woodville Area Sch. Dist. v. W. Cent. Educ. Ass'n, 2009 WI 51,

¶21, 317 Wis. 2d 691, 766 N.W.2d 591 (citations omitted). A

court must apply the standard of review that is appropriate for

the facts of the case.

¶128 An arbitration award involving the interpretation of a

contract will not be disturbed unless it is the product of a

perverse misconstruction of the contract, City of Oshkosh

(Public Library) v. Oshkosh Public Library Clerical &

Maintenance Employees Union Local 796-A, 99 Wis. 2d 95, 106, 299

N.W.2d 210 (1980) (citing cases), or unless the contract itself
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violates the law. Here, the appropriate standard is the

"perverse misconstruction" standard because Borst permits the

scope of discovery to be set out in the contract.

¶129 In Baldwin-Woodville, the court stated:

[W]e do not determine which construction——the
arbitrator's or the District's——is more reasonable.
See Lukowski, 184 Wis. 2d at 153 ("[T]his court will
not upset the award even if this court might have
decided the matter differently."). Instead, we will
uphold an award if there is "some reasonable
foundation for the interpretation of the contract
offered in the decision." Id.

Baldwin-Woodville, 317 Wis. 2d 691, ¶22.
¶130 The majority would be hard pressed to argue that there

is no reasonable basis for the panel's construction of the

"Local rules of law" sentence in the arbitration provision of

the contract. After all, the Marlowes' attorney conceded that

the construction was "reasonably made." Moreover, the sentence—

—which is not unique to the Marlowes' insurance contract——must

mean something, and it is not plausible that the sentence was

intended to mean that arbitrators are bound by rules of
procedure and evidence established by the circuit courts——county

by county——but need not follow the procedural and evidentiary

rules embodied in state law.

¶131 The majority's standard of review cites the perverse

misconstruction standard but then disregards it. Majority op.,

¶10.

¶132 Clearly, a contract may authorize prehearing discovery

in an arbitration proceeding. It is not manifest disregard of

the law or a violation of strong public policy to do so. The
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issue here is whether the contract's reference to "Local rules

of law" achieved this purpose. This court is required to give a

deferential review of the arbitration panel's construction of

the contract language, not rely on extraneous law.

¶133 Proper application of the perverse misconstruction

standard would put this case in a different light.

III. CONCLUSION

¶134 Once again, the theme that permeates the majority
opinion is that arbitrations are different from civil court

trials and thus discovery in arbitration should be wholly

different from discovery in court cases.

¶135 I agree that arbitration discovery should normally be

simpler and more streamlined than civil court discovery.

Arbitrators have a vested interest in making arbitration work as

intended. Thus, depriving arbitrators of virtually all

authority to manage prehearing discovery, consistent with the

goals of arbitration, and forcing the parties to discover

evidence and present evidence primarily at the arbitration

hearing, strike me as undercutting arbitration, not facilitating

it. After this decision, time will tell.

¶136 For the foregoing reasons, I respectfully concur in

part and dissent in part.

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