In Marlowe v. IDS Property Cas. Ins. Co., No. 11AP2067 (Wis. Ct. App. Mar. 13, 2012), the Court of Appeals, resolving an issue of first impression in Wisconsin, held that a party to an arbitration under the Wisconsin Arbitration Act, Wis. Stat. ch. 788, may not, while the arbitration is pending, seek circuit court review of a decision by the arbitrators on the scope of discovery. As a separate and independent ground for its conclusion, the court held that, where arbitrators resolve a discovery dispute by interpreting a provision in the arbitration agreement, their decision is final and not subject to judicial review.
In arbitrating a dispute about an uninsured motorist clause, the insurer sought not only to depose the insureds but to obtain their medical records and an independent medical exam. The policy contained a provision that, in the arbitration, “[l]ocal rules of law as to procedure and evidence will apply.” The arbitrators decided that the insurer could take all discovery permitted under Wis. Stat. ch. 804, rather than just depositions, as Wis. Stat. § 788.07 permits. The insureds then sought and obtained a declaratory judgment from the circuit court that only depositions could be taken. Relying on substantial federal case law interpreting comparable provisions of the Federal Arbitration Act, the court of appeals reversed, holding that, at least in the absence of exigent circumstances not present here, parties may not obtain judicial review of intermediate decisions of arbitrators, but only of final awards.
To reach its alternative ground for decision, the court had to distinguish Borst v. Allstate Ins. Co., 2006 WI 70, 291 Wis. 2d 361, 717 N.W.2d 42, in which the Supreme Court reversed a final award because the arbitrators had permitted discovery beyond the depositions permitted under § 788.07. The court of appeals said that the presence of the quoted language in the policy about “local rules” made this an issue of contract interpretation here, as to which the arbitrators’ decision is final, under Employers Ins. of Wausau v. Certain Underwriters at Lloyd’s, 202 Wis. 2d 673, 552 N.W.2d 420 (Ct. App. 1996). See also Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79 (2002).
Marlowe has been recommended for publication. A link to the decision is here.
This blog is made available by Foley & Lardner LLP (“Foley” or “the Firm”) for informational purposes only. It is not meant to convey the Firm’s legal position on behalf of any client, nor is it intended to convey specific legal advice. Any opinions expressed in this article do not necessarily reflect the views of Foley & Lardner LLP, its partners, or its clients. Accordingly, do not act upon this information without seeking counsel from a licensed attorney.
This blog is not intended to create, and receipt of it does not constitute, an attorney-client relationship. Communicating with Foley through this website by email, blog post, or otherwise, does not create an attorney-client relationship for any legal matter. Therefore, any communication or material you transmit to Foley through this blog, whether by email, blog post or any other manner, will not be treated as confidential or proprietary.
The information on this blog is published “AS IS” and is not guaranteed to be complete, accurate, and or up-to-date. Foley makes no representations or warranties of any kind, express or implied, as to the operation or content of the site. Foley expressly disclaims all other guarantees, warranties, conditions and representations of any kind, either express or implied, whether arising under any statute, law, commercial use or otherwise, including implied warranties of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Foley or any of its partners, officers, employees, agents or affiliates be liable, directly or indirectly, under any theory of law (contract, tort, negligence or otherwise), to you or anyone else, for any claims, losses or damages, direct, indirect special, incidental, punitive or consequential, resulting from or occasioned by the creation, use of or reliance on this site (including information and other content) or any third party websites or the information, resources or material accessed through any such websites.
In some jurisdictions, the contents of this blog may be considered Attorney Advertising. If applicable, please note that prior results do not guarantee a similar outcome. Photographs are for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.