2018 WI 112

SUPREME COURT OF WISCONSIN

CASE NO.: 2016AP601

COMPLETE TITLE: Midwest Neurosciences Associates, LLC and 

Neurosurgery and Endovascular Associates, SC,

 Plaintiffs-Appellants,

 v.

Great Lakes Neurosurgical Associates, LLC and 

Yashdip Pannu, M.D.,

 Defendants-Respondents-Petitioners.

REVIEW OF DECISION OF THE COURT OF APPEALS

Reported at 379 Wis. 2d 766, 909 N.W.2d 209 

(2018 – unpublished)

OPINION FILED: December 19, 2018

SUBMITTED ON BRIEFS:

ORAL ARGUMENT: October 10, 2018

SOURCE OF APPEAL:

COURT: Circuit

COUNTY: Ozaukee

JUDGE: Paul V. Malloy

JUSTICES:

CONCURRED: ABRAHAMSON, J. concurs.

DISSENTED: R.G. BRADLEY, J. dissents.

NOT PARTICIPATING: DALLET, J. did not participate. 

ATTORNEYS:

For the defendants-respondents-petitioners, there were 

briefs filed by Joan M. Huffman, Paul R. Erickson, and Gutglass,

Erickson, Bonville & Larson, S.C., Milwaukee. There was an oral 

argument by Joan M. Huffman.

For the plaintiffs-appellants, there was a brief filed by 

Frank M. Gumina, Patrick M. Harvey, and Husch Blackwell LLP, 

Milwaukee. There was an oral argument by Patrick M. Harvey.
2018 WI 112

NOTICE

This opinion is subject to further 

editing and modification. The final 

version will appear in the bound 

volume of the official reports. 

No. 2016AP601

(L.C. No. 2015CV324)

STATE OF WISCONSIN : IN SUPREME COURT

Midwest Neurosciences Associates, LLC and 

Neurosurgery and Endovascular Associates, SC,

 Plaintiffs-Appellants,

 v.

Great Lakes Neurosurgical Associates, LLC and 

Yashdip Pannu, M.D.,

 Defendants-Respondents-Petitioners.

FILED

DEC 19, 2018

Sheila T. Reiff

Clerk of Supreme Court

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

cause remanded.

¶1 ANNETTE KINGSLAND ZIEGLER, J. This is a review of an 

unpublished decision of the court of appeals, Midwest 

Neurosciences Assocs., LLC v. Great Lakes Neurosurgical Assocs., 

LLC, No. 2016AP601, unpublished slip op. (Wis. Ct. App. Dec. 20, 

2017), reversing the Ozaukee County circuit court's1 non-final 

order. The non-final order denied Midwest Neurosciences 

Associates, LLC ("Midwest") and Neurosurgery and Endovascular 

 

1 The Honorable Paul V. Malloy presided.
No. 2016AP601

2

Associates S.C.'s ("NEA") motion to stay this action and compel 

arbitration pursuant to the Amended and Restated Operating 

Agreement ("Operating Agreement"), as well as the circuit 

court's granting of Yashdip Pannu, M.D. ("Dr. Pannu") and Great 

Lakes Neurosurgical Associates, LLC's ("Great Lakes") motion for 

declaratory judgment seeking a declaration that the Membership 

Interest Redemption Agreement ("Redemption Agreement") was a 

valid contract. The court of appeals remanded to the circuit 

court with instructions to grant Midwest's motion to compel 

arbitration pursuant to the Operating Agreement. We reverse the 

court of appeals and remand to the circuit court to determine 

whether the Redemption Agreement is enforceable. 

¶2 The crux of the issue before us concerns the circuit 

court's role in determining the proper forum of dispute 

resolution when a subsequent contract, if enforceable, does not 

contain an arbitration clause as is present in an initial 

contract. As a part of that analysis we consider whether a 

contract which contains a merger clause and which does not 

contain an arbitration clause can change the forum of dispute 

resolution when a prior agreement between the parties contains

an arbitration clause.

2 The parties make competing arguments 

 

2 The parties disagree as to whether the Redemption 

Agreement was validly formed. The JAMS Arbitration Rules in the 

Operating Agreement, however, require that even the issue of 

arbitrability be arbitrated. See infra note 7. "JAMS provides 

arbitration and mediation services worldwide," including the 

creation of rules that can be used to govern the arbitration of 

disputes at the parties' agreement. JAMS Comprehensive 

Arbitration Rules & Procedures Rule 1, at 1, 6 (July 1, 2014), 

(continued)
No. 2016AP601

3

regarding a court's role in determining the applicability of 

this arbitration provision. They take contrary positions 

regarding whether all disputes, even arbitrability itself, must 

be submitted to arbitration. The parties present conflicting 

views of precedent regarding the judiciary's role in deciding 

motions to compel arbitration when a subsequent contract does 

not select arbitration as the forum for dispute resolution and 

does contain a merger clause which states that the subsequent 

agreement supersedes all prior contracts. Relatedly, the 

parties dispute whether all parties here can be compelled to 

arbitrate when arguably only one co-defendant is contractually 

required to arbitrate pursuant to the initial contract. 

¶3 The claims in the underlying lawsuit that called upon 

the court to decide whether the dispute belonged in arbitration, 

involve whether Great Lakes and Dr. Pannu violated restrictive 

covenants in the Operating Agreement and the Ancillary 

Restrictive Covenant Agreement ("Ancillary Restrictive 

Covenant"). The Redemption Agreement, however, does not contain 

an arbitration provision and in fact, purports to release those 

restrictive covenants. Therefore, which contract controls is 

seminal in the first instance as to whether arbitration should 

be ordered. Ultimately, regardless of forum, the controlling 

documents will also impact the underlying dispute itself. 

 

https://www.jamsadr.com/files/Uploads/Documents/JAMS-Rules/

JAMS_comprehensive_arbitration_rules-2014.pdf.
No. 2016AP601

4

¶4 The circuit court concluded on summary judgment that 

even though the initial agreement, here the Operating Agreement, 

required arbitration it was superseded by a later, valid and 

enforceable Redemption Agreement which did not so require the 

parties to submit to arbitration. The court of appeals reversed 

and remanded with instructions to grant Midwest's motion to 

compel arbitration.

3 

¶5 We reverse the court of appeals and conclude that the 

fundamental principles of freedom to contract allow parties to a 

previous contract to subsequently contract for a different forum 

of dispute resolution. Here, it is necessary that the circuit 

court initially determine whether the parties contracted to 

arbitrate. The court's authority to order arbitration is 

dependent on the terms of a contract. If the Redemption 

Agreement is the parties' contract, then the court lacks 

authority to order arbitration. Thus, the court must first 

ascertain which contract controls the forum of dispute 

resolution. In sum, we conclude that it is a court's duty to 

determine whether a contract calls for arbitration and when a 

dispute exists as to whether a second contract without an 

arbitration clause supersedes a first contract with such a 

 

3 Presiding Judge Reilly concurred, expressing concern that 

Cirilli v. Country Insurance & Financial Servs., 2009 WI App 

167, 322 Wis. 2d 238, 776 N.W.2d 272, and Mortimore v. Merge 

Technologies Inc., 2012 WI App 109, 344 Wis. 2d 459, 824 N.W.2d 

155, erode freedom of contract and prevent parties from 

subsequently contracting out of arbitration. 
No. 2016AP601

5

clause, the determination of arbitrability must be decided in 

the first instance by the circuit court rather than the 

arbitrator.

¶6 We also conclude, however, that the cause must be 

remanded to the circuit court, not to compel arbitration as was 

ordered by the court of appeals, but rather, because the 

parties' competing affidavits submitted in support of their 

positions on summary judgment raised genuine issues of material 

fact concerning whether the Redemption Agreement is a valid 

contract.4 Therefore, we reverse and remand to the circuit court 

for further proceedings.

I. FACTUAL BACKGROUND

¶7 Dr. Pannu was Great Lakes' president, 100 percent 

owner, and sole practicing physician. Arvind Ahuja, M.D. 

("Dr. Ahuja") was the sole Member of Midwest and later the sole 

Member of NEA. William McCullough, M.D. ("Dr. McCullough") was 

the sole Member of Metro Neurosurgical, S.C. ("Metro"). In 

2015, the three Members of Midwest were NEA, Great Lakes, and 

Metro. The presidents of each were also practicing 

neurosurgeons and had offices adjacent to St. Luke's Medical 

Center in Milwaukee, Wisconsin. The current dispute involves 

 

4 We need not weigh in on the host of issues that might 

relate to a non-signatory being bound by an arbitration 

agreement, such as (1) assumption, (2) agency, (3) estoppel, (4) 

veil piercing, and (5) incorporation by reference. Zurich Am. 

Ins. Co. v. Watts Indus., Inc., 417 F.3d 682, 687 (7th Cir. 

2005).
No. 2016AP601

6

only Drs. Pannu and Ahuja and the applicability of an 

arbitration provision from a contract entered into a decade 

previous. 

¶8 Specifically, on August 1, 2005, the parties at issue 

executed an Operating Agreement which modified a previous 

operating agreement of August, 2002 so to admit, among others, 

Dr. Pannu to Midwest.5 Dr. Pannu executed the Operating 

Agreement as President of Great Lakes and also signed a personal 

guaranty for the obligations of Great Lakes. The Operating 

Agreement contains the arbitration clause at issue. 

¶9 The Operating Agreement created rights, obligations, 

and restrictions for the Members of Midwest and the physicians 

that worked for the Members. The document includes various 

other provisions. For example, the Operating Agreement controls 

how Midwest was to be managed and operated. For instance, 

subsection 1.2(a) dictates that Midwest shall have a registered 

office and subsection 5.5(b) grants Midwest's president the 

power to unilaterally terminate Members. 

¶10 Section 8.5 of the Operating Agreement grants Members 

the right to voluntarily withdraw from Midwest. Under Section 

8.5, a Member could withdraw from Midwest by "giving written 

 

5 Midwest's primary purpose was to assist its Members, who 

employed physicians, in "the operation of their medical 

practices."
No. 2016AP601

7

notice to [Midwest] at least ninety (90) days before the stated 

effective date of the withdrawal."6

¶11 Section 13.3 dictates that the "Operating Agreement 

shall be governed by and construed in accordance with the laws 

of the State of Wisconsin without regard to its choice of law 

provisions."

¶12 Section 13.1 of the Operating Agreement provides:

Amendments to Operating Agreement. No Amendment 

or modification of this Operating Agreement shall be 

valid unless in writing and signed by all of the 

Members. Unless otherwise provided in such an 

amendment or modification, this Operating Agreement 

shall be considered to be amended only to the minimal 

extent necessary to give effect to this Operating 

Agreement, and the other terms and conditions of this 

Operating Agreement shall continue to apply with full 

force and effect. 

¶13 Section 13.7 of the Operating Agreement is entitled 

"Arbitration," and states, in pertinent part:

Arbitration. . . . [T]he parties hereto agree to 

resolve any and all disputes arising with respect to 

the terms and conditions of this Operating Agreement 

hereby by arbitration . . . . The arbitration shall 

be governed by the laws of the State of Wisconsin, 

this Operating Agreement and JAMS' Arbitration Rules[7] 

to the extent not inconsistent with the foregoing.

 

6 The provision of notice under Section 8.5 was subject to 

the provisions of Section 13.8, which provided that the notice 

was "valid only if in writing and upon actual receipt by the 

intended recipient of the notice." This provision factors into 

the arguments about the Redemption Agreement's enforceability.

7 JAMS Arbitration Rule 11, "Interpretation of Rules and 

Jurisdictional Challenges," in relevant part, provides:

(b) Jurisdictional and arbitrability disputes, 

including disputes over the formation, existence, 

(continued)
No. 2016AP601

8

¶14 Section 8.13 contains a "Covenant Not to Compete," 

which details, among other things, a restriction that the 

doctors practice in their specialty for a designated period of 

time, in a specified area, and at particular facilities.8 On 

March 6, 2006, Dr. Pannu personally signed the Ancillary 

Restrictive Covenant containing similar terms to Section 8.13 of 

the Operating Agreement. The Ancillary Restrictive Covenant, 

however, did not specifically incorporate by reference Section 

13.7, the arbitration section, of the Operating Agreement. 

¶15 Nearly ten years later, in 2015, Great Lakes and NEA 

were two of three remaining Members of Midwest. On February 13, 

2015, the Members unanimously voted to dissolve Midwest as of 

March 31, 2015. One doctor relocated out of state and is not 

part of this lawsuit.9 Dr. Ahuja, who had no hospital privileges 

in the Milwaukee area, had previously announced his intention to 

vacate his practice from the offices. 

 

validity, interpretation or scope of the agreement 

under which Arbitration is sought, and who are proper 

Parties to the Arbitration, shall be submitted to and 

ruled on by the Arbitrator. The Arbitrator has the 

authority to determine jurisdiction and arbitrability 

issues as a preliminary matter.

JAMS Comprehensive Arbitration Rules & Procedures Rule 11(b), 

supra note 2, at 14.

8 The underlying litigation in this case claims that Great 

Lakes and Dr. Pannu violated non-compete restrictive covenants.

9 Dr. McCullough moved to Texas and vacated the offices.
No. 2016AP601

9

¶16 On March 16, 2015, the Members restructured the 

dissolution process such that NEA would buy out the Members' 

interests in Midwest. Great Lakes would vacate the premises no 

later than May 15, 2015. Great Lakes, however, was subject to 

the non-compete provisions of the Operating Agreement. After 

discussing the logistics of how the purchases would work, the 

Members unanimously voted to rescind the vote to dissolve 

Midwest.10

¶17 On March 30, 2015, Midwest's attorney sent an e-mail 

to Dr. Pannu, Dr. Ahuja, and Great Lakes' and Midwest's 

accountants attaching a "proposed [Redemption Agreement] and 

[an] Assignment Agreement" which concerned, in part, the release 

of the non-compete provision with Midwest. The recipients of 

the e-mail were instructed to ask any questions at their 

"earliest opportunity" because "we intend to exchange funds and 

sign documents tomorrow." On March 31, 2015, in response to a 

suggestion from Great Lakes' accountant, Midwest's attorney 

added one paragraph to the Redemption Agreement and confirmed 

 

10 NEA's offer to buy the other Members' interests came in 

response to the Members being advised that there were unforeseen 

difficulties with winding down Midwest related to expenses and 

lease obligations. Prior to voting, the Members had a lengthy 

discussion regarding retirement plans and lease obligations. 

With respect to the retirement plans, it was determined that 

actuarial calculations would be done to determine how much 

Dr. Pannu and Dr. McCullough would pay. In addition, it was 

agreed that Midwest's accountant would calculate the projected 

wind-down expense budget for Midwest and that Dr. Pannu and 

Dr. McCullough would pay their projected wind-down expenses 

based on that budget. 
No. 2016AP601

10

that his assistant had sent the "the final agreement." The email also contained the following instructions: "Please sign and 

deliver per my earlier email."11

¶18 On the same day, Dr. Pannu executed the Redemption 

Agreement and the accompanying Assignment Agreement12 and 

delivered them to Midwest's attorney. The Redemption Agreement 

distinguishes Great Lakes from Dr. Pannu as "Pannu" and 

"Y. Pannu," respectively, and also notes that it is Great Lakes, 

"Pannu", that holds a one-third membership interest in Midwest.

¶19 The Redemption Agreement outlines Great Lakes and 

Midwest's desire to "set forth the terms upon which [Great 

Lakes] will sell and [Midwest] will redeem [Great Lakes'] entire 

Membership Interest" in Midwest. For instance, the Redemption 

Agreement indicates that Great Lakes "desires to voluntarily 

surrender [Great Lakes'] membership in [Midwest] effective 

March 31, 2015, pursuant to Section 8.5 of the Operating 

 

11 Great Lakes and Dr. Pannu assert that Midwest's attorney 

was acting as both Midwest's and NEA's attorney when he 

circulated the Redemption Agreement. They allege that this does 

not create a conflict of interest because Dr. Ahuja cannot 

approve the transaction with respect to Midwest, while rejecting 

the same transaction with respect to NEA. Midwest and NEA, 

however, allege that if Midwest's attorney "was representing 

Midwest, he could not also represent NEA" because Great Lakes 

was still a Member of Midwest. It is not necessary for us to 

answer this disagreement.

12 The Assignment Agreement states that, as of March 31, 

2015, Great Lakes "transfer[red] and assign[ed] to 

[Midwest] . . . all of [Great Lakes'] right, title and interest 

in and to the Membership Interests." 
No. 2016AP601

11

Agreement," and Section 2 of the Redemption Agreement dictates 

that Great Lakes "shall sell, assign and transfer to [Midwest], 

free and clear of all liens, claims, agreements and 

encumbrances, and [Midwest] shall purchase and acquire from 

[Great Lakes], the entire Membership Interest." The Redemption 

Agreement outlines the purchase price for Great Lakes' 

membership interest and specifically identified and allocated to 

Great Lakes the amount that it was required to pay to Midwest 

for its share of the costs associated with winding down Midwest, 

as well as requiring Great Lakes to pay a set amount relating to 

retirement plans. The Redemption Agreement also establishes 

that Great Lakes must "fully vacate" its office suite by 

April 30, 2015.

¶20 Section 6 of the Redemption Agreement is entitled, 

"Mutual Release," and provides:

[Midwest] Releasees [, defined as "[Midwest] and each 

of [Midwest's] Members and the Members' shareholders, 

members, owners, successors, assigns, agents, 

directors, officers, employees, representatives,

attorneys, heirs, executors and administrators of such 

of the foregoing as are natural persons, and all 

persons acting by, through, under or in concert with 

any of the foregoing,] hereby jointly and severally, 

irrevocably and unconditionally release, acquit and 

forever discharge [Great Lakes and Dr. Pannu] and each 

of [Great Lakes'] shareholders, members, owners, 

successors, assigns, agents, directors, officers, 

employees, representatives, attorneys, heirs, 

executors and administrators of such of the foregoing 

as are natural persons, and all persons acting by, 

through, under or in concert with any of the foregoing 

(collectively, "Pannu Releasees"), or any of them, 

from any and all Claims[, defined as charges, 

complaints, claims, liabilities, obligations, 

promises, agreements, controversies, damages, actions, 
No. 2016AP601

12

causes of action, suits, rights, demands, costs, 

losses, debts and expenses (including attorneys' fees 

and costs actually incurred), known and unknown, of 

any nature whatsoever, including without limitation,

any and all claims under the Expense Sharing 

Agreement, the Operating Agreement, and any and all 

other claims, whether at common law, in contract or 

tort,] which [Midwest] Releasees now have or claim to 

have or which [Midwest] Releasees at any time 

heretofore had or claimed to have or which [Midwest] 

Releasees at any time hereafter may have or claim to 

have for any claims arising or accruing to the date 

hereof against each or any of the Pannu Releasees, 

other than for a breach of this Agreement. (Emphases 

added.) 

¶21 Section 7 of the Redemption Agreement, "Release of 

Non-Compete Restrictions," states: "[Great Lakes and Dr. Pannu] 

are currently subject to non-compete restrictions contained in 

the Operating Agreement and in the [Ancillary Restrictive 

Covenant]. In consideration for the terms of this Agreement, 

[Great Lakes and Dr. Pannu's] restrictions against competition 

are hereby released and made void." 

¶22 Section 10.3 of the Redemption Agreement, "Applicable 

Law," does not reference arbitration, nor does an arbitration 

clause exist elsewhere in the Redemption Agreement. Section 

10.3 reads: "All questions concerning the construction, validity 

and interpretation of this Agreement and the performance of the 

obligations imposed by this Agreement shall be governed by the 

internal law, not the law of conflicts, of the State of 

Wisconsin."

¶23 According to Dr. Pannu's affidavit, he and Great Lakes 

had performed all of their obligations under the Redemption 

Agreement other than moving out of their office by April 8, 
No. 2016AP601

13

2015. For instance, Dr. Pannu said he delivered a check for 

Great Lakes' share of the wind-down expenses to Midwest's 

attorney and hand-delivered a check for Great Lakes' retirement 

plan contributions to Midwest's accounting firm. It is 

undisputed that one of Great Lakes' checks was cashed.13

¶24 On April 8, 2015, Dr. Pannu attempted to get a copy of 

the Redemption Agreement as signed by Dr. Ahuja. Initially, 

Dr. Pannu exchanged text messages with Dr. Ahuja:

Dr. Pannu: Hi

Can u get me a copy of the 

[Redemption Agreement] signed by you

Thx

Dr. Ahuja: Will work on it when I am back

? Anything up

Dr. Pannu: No

Attorney wants it

So it is clean

Dr. Ahuja: Yea and it appears not going to

let us out of lease

But I will take care of it

Dr. Pannu: Ok

Dr. Ahuja: ? Who is your lawyer thx

Dr. Pannu: [Lawyer's name]14

 

13 According to Dr. Ahuja's affidavit, the check was cashed 

in error by a clerical employee and a cashier's check in the 

same amount was sent to Dr. Pannu once the error was discovered.

14 The attorney that Dr. Pannu named clarified on the record 

at a motion hearing on December 17, 2015, that he "was not 

involved in this" prior to April 8, 2015, and had not been 

"copied on anything . . . prior to that." 
No. 2016AP601

14

Dr. Ahuja: K great 

¶25 Further, within ten minutes of sending the initial 

text message, Dr. Pannu sent an e-mail to Midwest's attorney, 

and carbon copied Dr. Ahuja and Midwest's and Great Lakes' 

accountants, asking Midwest's attorney to "let [him] know when 

you get a signed copy of the agreement from [Dr. Ahuja]." 

Midwest's attorney responded that he would meet with Dr. Ahuja 

to get his signature "[a]s soon as all of the documentation is 

accounted for."15

¶26 According to Dr. Ahuja's affidavit, he (and thus 

Midwest and NEA) never agreed to the terms of the Redemption 

Agreement. Initially, Dr. Ahuja said he never instructed 

Midwest's attorney to include a complete release of Great Lakes' 

or Dr. Pannu's non-compete obligations in the Redemption 

Agreement and that Dr. Ahuja in fact disagreed with releasing 

the restrictions. Further, Dr. Ahuja stated that during an 

April 20, 2015 phone call with Dr. Pannu, he told Dr. Pannu that 

he was still reviewing the Redemption Agreement. Moreover, 

Dr. Ahuja stated that once he had more thoroughly reviewed the 

Redemption Agreement, he determined he was not willing to sign 

it.

 

15 In the e-mail, Midwest's attorney stated that they were 

waiting on retirement plan documents from Great Lakes. 

According to Dr. Pannu's affidavit, Great Lakes and Dr. Pannu 

had already provided the requested documents to Midwest's 

accountant.
No. 2016AP601

15

¶27 On April 30, 2015, Great Lakes vacated the office and 

moved into different office space in the same facility that was 

shared with a physician unaffiliated with Midwest.16

¶28 In May of 2015, Great Lakes and Dr. Pannu were advised 

that Midwest and NEA considered the Redemption Agreement to be a 

mere proposal that was subsequently rejected by Midwest and NEA. 

Thus, Midwest and NEA alleged that Great Lakes and Dr. Pannu 

were violating the non-compete covenants in the Operating 

Agreement and the Ancillary Restrictive Covenant. 

¶29 On July 1, 2015, Dr. Ahuja, on behalf of Midwest, sent 

a letter to Dr. Pannu informing him that Great Lakes' membership 

status in Midwest was being terminated effective immediately 

pursuant to Section 5.5(b) of the Operating Agreement. The 

letter also demanded that Great Lakes and Dr. Pannu comply with 

the non-compete restrictions in the Operating Agreement and the 

Ancillary Restrictive Covenant. 

II. PROCEDURAL POSTURE

¶30 On September 2, 2015, Midwest and NEA filed a 

complaint against Great Lakes and Dr. Pannu alleging that Great 

Lakes and Dr. Pannu breached the non-compete covenants of the 

 

16 Great Lakes and Dr. Pannu subsequently moved back into 

their old office that was shared with Midwest from June of 2015 

to January of 2016, but moved out once more in January of 2016. 
No. 2016AP601

16

2005 Operating Agreement and the 2006 Ancillary Restrictive 

Covenant.17 

¶31 Before a responsive pleading was filed, Midwest and 

NEA moved to stay the proceedings and compel arbitration in 

accordance with Section 13.7 of the Operating Agreement. 

Midwest and NEA argued that the Operating Agreement was the 

governing contract between the parties and that Section 13.7 

within that agreement unambiguously required the parties to 

arbitrate violations of Section 8.13 of the Operating Agreement 

and the Ancillary Restrictive Covenant. Midwest and NEA argued 

that the Operating Agreement governed because there was never a 

meeting of the minds on the Redemption Agreement, as well as the 

fact that the Redemption Agreement was never signed by all of 

the parties which was required to amend the Operating Agreement 

per Section 13.1. Further, Midwest and NEA argued that any 

challenge to the validity of the Operating Agreement must be 

decided by an arbitrator, not the circuit court. 

¶32 On October 6, 2015, Great Lakes and Dr. Pannu filed an 

answer containing affirmative defenses and counterclaims,18 as 

 

17 On February 29, 2016, Midwest and NEA filed an amended 

complaint, reiterating the causes of action in the initial 

complaint and pleading additional causes of action against Great 

Lakes and Dr. Pannu related to Great Lakes and Dr. Pannu's 

payment of rent to Midwest, as well as Great Lakes and 

Dr. Pannu's alleged tortious interference with Midwest and NEA's 

prospective and current contractual relationships. 

18 On February 29, 2016, Great Lakes and Dr. Pannu filed an 

amended counterclaim. On April 15, 2016, Great Lakes and 

Dr. Pannu filed an amended answer containing affirmative 

defenses and counterclaims.
No. 2016AP601

17

well as a motion for declaratory judgment seeking, among other 

things, an order declaring that the Redemption Agreement was a 

valid contract. They contended that as of March 31, 2015, the 

Operating Agreement and the non-compete provisions of the 

Ancillary Restrictive Covenant were invalid, unenforceable, 

and/or inapplicable to Great Lakes and Dr. Pannu. Great Lakes 

and Dr. Pannu argued that the Redemption Agreement is binding 

and released them from the non-compete restrictions in the 

Operating Agreement and the Ancillary Restrictive Covenant. 

They argued that the Redemption Agreement was binding because 

Midwest and NEA manifested their intention to sign the 

Redemption Agreement and reaffirmed their intention by allowing 

Great Lakes and Dr. Pannu to fully perform the obligations 

therein. Accordingly, the motion further sought an order 

declaring that Midwest and NEA are not entitled to arbitration. 

In subsequent responses, Great Lakes and Dr. Pannu argued that 

the circuit court must decide whether the Redemption Agreement 

is enforceable and that, at best, it is premature to compel 

arbitration because the merits of the case hinge entirely on the 

enforceability of the Redemption Agreement, which contains no 

arbitration clause and in fact, fully releases them from the 

claims asserted. The parties filed briefs and affidavits in 

support of their respective positions. 

¶33 On December 17, 2015, the circuit court held a hearing 

on both motions. Initially, the circuit court stated that the 

motion for declaratory judgment was "similar to a summary 

judgment motion" and that "maybe there[ are] some" factual 
No. 2016AP601

18

disputes. Nonetheless, the court found that Dr. Ahuja, through 

Midwest's attorney, made an offer that he intended to be bound 

by when the e-mail containing the "final agreement" was sent. 

Further, the circuit court noted that Dr. Pannu accepted the 

offer when he signed the Redemption Agreement and returned it 

with the check that was subsequently cashed. Moreover, the 

circuit court held that the "minor problems" after March 31, 

2015, or Dr. Ahuja's "ambiguous" text message to Dr. Pannu on 

April 8, 2015, that a reasonable person could view as saying 

"I'm questioning the agreement," do not change the analysis 

because the Redemption Agreement was already a "done deal" and 

the "horse was kind of out of the barn and you can't put it 

back." The circuit court granted Great Lakes and Dr. Pannu's 

motion and concluded that the Redemption Agreement was an 

enforceable contract and thus, that Great Lakes and Dr. Pannu 

were not restricted by the covenants not to compete in either 

the Operating Agreement or the Ancillary Restrictive Covenant.

¶34 On March 16, 2016, the circuit court issued a written 

order granting Great Lakes and Dr. Pannu's motion and declaring

that the Redemption Agreement was a valid contract. The court 

determined that as of March 31, 2015, the Operating Agreement 

and the non-compete provisions of the Ancillary Restrictive 

Covenant were invalid, unenforceable and/or inapplicable to 

Great Lakes and Dr. Pannu. The order also denied Midwest and 

NEA's motion to stay the action and compel arbitration.

¶35 On March 23, 2016, Midwest and NEA petitioned for 

leave to appeal the circuit court's March 16 order, which the 
No. 2016AP601

19

court of appeals granted. On December 20, 2017, the court of 

appeals issued its decision concluding that the "determinative 

question is whether the circuit court erred by not ordering the 

parties to submit their dispute to arbitration." Midwest 

Neurosciences, No. 2016AP601, ¶8. The court of appeals held 

"that the question of whether the arbitration clause was 

superseded should have been submitted to arbitration." Id., ¶2. 

As such, the court of appeals declined to address the multiple 

other issues that Midwest and NEA raised on appeal and reversed 

and remanded, instructing the circuit court to grant Midwest and 

NEA's motion to compel arbitration. Id., ¶¶2, 8, 23.

¶36 On February 5, 2018, Great Lakes and Dr. Pannu 

petitioned this court for review. On May 18, 2018, we granted 

the petition. We now reverse and remand the cause for further 

proceedings consistent with this opinion.

III. STANDARD OF REVIEW

¶37 This case comes to us on summary judgment.19 "We 

review summary judgment rulings independently, applying the 

 

19 The circuit court understood Great Lakes and Dr. Pannu's 

motion for declaratory judgment to be "similar to a summary 

judgment motion" and applied the summary judgment methodology. 

Thus, while the motion was entitled a motion for declaratory 

judgment, it was actually a motion for summary judgment. See

WEA Prop. & Cas. Ins. Co. v. Krisik, 2013 WI App 139, ¶¶1, 4 

n.2, 8, 352 Wis. 2d 73, 841 N.W.2d 290 (reviewing a motion for 

declaratory judgment as a summary judgment motion because the 

circuit court understood the motion to "in essence [] be a 

motion for summary judgment and applied the summary judgment 

methodology").
No. 2016AP601

20

well-established standards set forth in Wis. Stat. § 802.08 

[(2015-16)]." 20 Hirschhorn v. Auto-Owners Ins. Co., 2012 WI 20, 

¶20, 338 Wis. 2d 761, 809 N.W.2d 2d 529. Thus, we independently 

review whether the circuit court correctly granted summary 

judgment to Great Lakes and Dr. Pannu. Tatera v. FMC Corp., 

2010 WI 90, ¶15, 328 Wis. 2d 320, 786 N.W.2d 810 (citing Racine 

Cty. v. Oracular Milwaukee, Inc., 2010 WI 25, ¶24, 323 

Wis. 2d 682, 781 N.W.2d 88). Summary judgment "shall be 

rendered if the pleadings, depositions, answers to 

interrogatories, and admissions on file, together with the 

affidavits, if any, show that there is no genuine issue as to 

any material fact and that the moving party is entitled to a 

judgment as a matter of law." Id.; § 802.08(2).

¶38 "[A] petition to compel arbitration involves contract 

interpretation, which is a question of law that we review de 

novo." First Weber Grp., Inc. v. Synergy Real Estate Grp., LLC, 

2015 WI 34, ¶20, 361 Wis. 2d 496, 860 N.W.2d 498. Thus, 

"determination[s] of substantive arbitrability . . . [are] 

questions of law we review de novo." Cirilli v. Country Ins. & 

Fin. Servs., 2009 WI App 167, ¶10, 322 Wis. 2d 238, 776 

N.W.2d 272. Similarly, issues of contract interpretation are 

reviewed de novo. Mortimore v. Merge Technologies Inc., 2012 WI 

App 109, ¶13, 344 Wis. 2d 459, 824 N.W.2d 155.

 

20 All subsequent references to the Wisconsin Statutes are 

to the 2015-16 version unless otherwise indicated.
No. 2016AP601

21

IV. ANALYSIS

A. Fundamental Principles

1. Freedom to contract and laws governing arbitration

¶39 "Freedom of contract is based on the idea that 

individuals should have the power to govern their own affairs 

without interference." Solowicz v. Forward Geneva Nat'l, LLC, 

2010 WI 20, ¶34, 323 Wis. 2d 556, 780 N.W.2d 111. As such, "if 

there is one thing which more than another public policy 

requires it is that [individuals] of full age and competent 

understanding shall have the utmost liberty of contracting, and 

that their contracts, when entered into freely and voluntarily, 

shall be held sacred, and shall be enforced by courts of 

justice." Merten v. Nathan, 108 Wis. 2d 205, 212 n.5, 321 

N.W.2d 173 (1982) (quoting Balt. & Ohio Sw. Ry. Co. v. Voigt, 

176 U.S. 498, 505 (1900)). Thus, Wisconsin courts have 

generally sought "to enforce contracts deliberately made by the 

parties rather than set them aside." Baierl v. McTaggart, 2001 

WI 107, ¶12, 245 Wis. 2d 632, 629 N.W.2d 277.

¶40 Arbitration agreements are "a matter of contract." 

Joint Sch. Dist. No. 10 v. Jefferson Educ. Ass'n, 78 Wis. 2d 94, 

101, 253 N.W.2d 536 (1977) (quoting United Steelworkers v. 

Warrior & Gulf Navigation Co., 363 U.S. 574, 582 (1960)); First 

Options of Chi., Inc. v. Kaplan, 514 U.S. 938, 943 (1995). As 

such, "[a]rbitrators derive their authority only from the 

parties' advance agreement that they will submit such grievances 

to arbitration" and thus, parties cannot be "required to submit 

any dispute to arbitration unless [they have] agreed to do so." 
No. 2016AP601

22

Kimberly Area Sch. Dist. v. Zdanovec, 222 Wis. 2d 27, 39, 586 

N.W.2d 41 (Ct. App. 1998) (citing AT&T Technologies, Inc. v. 

Commc'ns Workers of America, 475 U.S. 643, 648-49 (1986)). 

Parties may contract broadly and agree to arbitrate, even the 

issue of arbitrability. Mortimore, 344 Wis. 2d 459, ¶¶15, 20. 

¶41 Wisconsin law recognizes the need to defer to the 

parties' agreement to arbitrate and the "policy of encouraging 

arbitration as an alternative to litigation." First Weber Grp., 

361 Wis. 2d 496, ¶24. When parties agree to arbitration, a 

court's role is limited because a different forum of dispute 

resolution has been selected. In fact, the Wisconsin 

legislature has codified the limited role of the court. See

Wis. Stat. ch. 788. In Mortimore, the court of appeals 

explained that when the parties have contracted to arbitrate, 

the court's "function is limited to a determination of whether: 

(1) there is a construction of the arbitration clause that would 

cover the grievance on its face and (2) whether any other 

provision of the contract specifically excludes it." Mortimore, 

344 Wis. 2d 459, ¶16.

¶42 Wisconsin's "policy of encouraging arbitration as an 

alternative to litigation," see First Weber Grp., 361 

Wis. 2d 496, ¶24, however, is not limitless. Even Midwest 

acknowledges that courts typically decide the initial issue of 

arbitrability. "[A]rbitrators cannot determine whether they 

have the authority to decide arbitrability unless the parties 

give arbitrators such authority." Kimberly Area Sch. Dist., 222 

Wis. 2d at 39-40; see generally Joint Sch. Dist. No. 10, 78 
No. 2016AP601

23

Wis. 2d at 110 (stating that "parties may submit arbitrability 

to an arbitrator"). "[T]he evidence of this grant [of 

authority] must be 'clear and unmistakable,'" otherwise, "the 

question of whether the parties agreed to arbitrate is to be 

decided by the court, not the arbitrator." Kimberly Area Sch. 

Dist., 222 Wis. 2d at 39-40; see also Kaplan, 514 U.S. at 944-45 

("silence or ambiguity" affects the presumption of 

arbitrability).

¶43 Consequently, only those disputes that the parties 

have agreed to so submit to arbitration are relegated to proceed 

in that forum. Granite Rock Co. v. Int'l Bhd. of Teamsters, 561 

U.S. 287, 299 (2010). A court should order arbitration "only 

where the court is satisfied that neither the formation of the 

parties' arbitration agreement nor (absent a valid provision 

specifically committing such disputes to an arbitrator) its 

enforceability or applicability to the dispute is in issue." 

Id. at 299; id. at 300 (stating all of the United States Supreme 

Court's opinions compelling arbitration did so only "after the 

Court was persuaded that the parties' arbitration agreement was 

validly formed and that it covered the dispute in question and 

was legally enforceable"). 

¶44 In Granite Rock Co., the Court clarified that "[t]he 

test for arbitrability remains whether the parties consented to 

arbitrate the dispute in question." Id. at 304 n.11. Thus, in 

Granite Rock Co., the Court concluded that judicial resolution 

was required "to determine whether the parties consented to 

arbitrate the matters covered by the [arbitration] demand." Id.
No. 2016AP601

24

at 303 n.9 & 304 (referencing Buckeye Check Cashing, Inc. v. 

Cardegna, 546 U.S. 440, 444 n.1 (2006)). This rule stems from 

the "principle that underscores all of our arbitration 

decisions: Arbitration is strictly 'a matter of consent,' and 

thus 'is a way to resolve those disputes——but only those 

disputes——that the parties have agreed to submit to 

arbitration.'" Id. at 299 (citation omitted).

¶45 In answering both who determines arbitrability and 

what is subject to arbitration, Wisconsin courts apply state-law 

contract principles and chapter 788. Kaplan, 514 U.S. at 944. 

Utilization of the Wisconsin contract principles requires

"courts to place arbitration agreements 'on equal footing with 

all other contracts.'" Kindred Nursing Ctrs. Ltd. P'ship v. 

Clark, 581 U.S. ___, 137 S. Ct. 1421, 1424, 1426 (2017). 

Accordingly, "[a] court may invalidate an arbitration agreement 

based on 'generally applicable contract defenses' like fraud or 

unconscionability, but not on legal rules that 'apply only to 

arbitration or that derive their meaning from the fact that an 

agreement to arbitrate is at issue.'" Id. at 1426. 

¶46 Chapter 788 of the Wisconsin Statutes is also referred 

to as the "Wisconsin Arbitration Act" and limits a court's role 

with respect to issues concerning arbitration. A court, 

however, must still, when called upon to do so, determine in the 

first instance whether the parties agreed to arbitrate. Then it 

becomes a court's duty to determine whether a contract calls for 

arbitration and when a dispute exists as to whether a second 

contract without an arbitration clause supersedes a first 
No. 2016AP601

25

contract with such a clause, the determination of arbitrability 

must be decided in the first instance by the circuit court 

rather than the arbitrator.

¶47 Wisconsin Stat. § 788.01, entitled "Arbitration 

clauses in contracts enforceable," provides that a written 

arbitration agreement "shall be valid, irrevocable and 

enforceable except upon such grounds as exist at law or in 

equity for the revocation of any contract" (emphasis added). As 

a result, it is a court's duty to determine whether a contract 

calls for arbitration. Another contract that clearly and 

expressly supersedes a first contract is "grounds as exist at 

law or in equity for the revocation of a contract." 

¶48 Wisconsin Stat. § 788.02 informs when a court must 

stay proceedings to permit arbitration, as follows: 

If any suit or proceeding be brought upon any issue 

referable to arbitration under an agreement in writing 

for such arbitration, the court in which such suit is 

pending, upon being satisfied that the issue involved 

in such suit or proceeding is referable to arbitration 

under such an agreement, shall on application of one 

of the parties stay the trial of the action until such 

arbitration has been had in accordance with the terms 

of the agreement, providing the applicant for the stay 

is not in default in proceeding with such arbitration.

Section 788.03 directs how a court ordering arbitration is to 

proceed and states in part as follows:

The party aggrieved by the alleged failure, neglect or 

refusal of another to perform under a written 

agreement for arbitration may petition any court of 

record having jurisdiction of the parties or of the 

property for an order directing that such arbitration 

proceed as provided for in such agreement. . . . The 

court shall hear the parties, and upon being satisfied 
No. 2016AP601

26

that the making of the agreement for arbitration or 

the failure to comply therewith is not in issue, the 

court shall make an order directing the parties to 

proceed to arbitration in accordance with the terms of 

the agreement.

Wis. Stat. § 788.03.

¶49 The court may, after arbitration, vacate an 

arbitrator's award or order a rehearing by the arbitrator, 

pursuant to Wis. Stat. § 788.10. In addition, the court may, 

after arbitration, modify an arbitrator's award pursuant to Wis. 

Stat. § 788.11. Finally, pursuant to Wis. Stat. § 788.12, a 

circuit court may enter judgment "[u]pon the granting of an 

order confirming, modifying or correcting an award," in 

conformity therewith.

¶50 Thus, when parties have contracted for arbitration as 

the forum for dispute resolution, a court's role is limited. In 

this case, however, the court must first ascertain whether the 

controlling contract calls for arbitration. Thus, we are 

presented with the question of the court's role when the parties 

once contracted to arbitrate, but the court is presented with a 

later written contract that does not contain an arbitration 

clause. Fundamental principles clearly militate in favor of the 

ability to freely contract, even if that changes the forum of 

dispute resolution. Which contract controls is seminal to a 

determination of whether arbitration must be ordered.

2. The contracts at issue

¶51 The contracts at issue require closer examination 

because whether the parties entered into the later contract 
No. 2016AP601

27

controls initially the court's determination regarding the 

proper forum of dispute resolution, but also later may impact 

the underlying dispute. If the Redemption Agreement is 

enforceable, its terms do not choose arbitration as the forum 

for dispute resolution. If it is not, the matter must proceed 

according to the Operating Agreement and the Ancillary 

Restrictive Covenant. Thus, it is the court that must first 

determine whether a valid contract requires arbitration. The 

dispute regarding the Redemption Agreement presents "such 

grounds as exist at law or in equity for the revocation of" the 

Operating Agreement and Ancillary Restrictive Covenant. Wis. 

Stat. § 788.01. Before an action can be stayed to permit 

arbitration, the court must be "satisfied that the issue 

involved in such suit or proceeding is referable to arbitration 

under such an agreement." Wis. Stat. § 788.02. Before the 

court can order arbitration, the court must be "satisfied that 

the making of the agreement for arbitration or the failure to 

comply therewith is not in issue." Wis. Stat. § 788.03.

¶52 Initially in 2005, the parties entered into an 

Operating Agreement which "memorialize[d] certain amendments and 

modifications to the Operating Agreement of [Midwest] dated 

August 1, 2002." This Operating Agreement changed the 2002 

contract to admit new Members but it clearly provided for 

arbitration in Section 13.7. The Operating Agreement contained 

a restrictive covenant between Great Lakes and Midwest in 

Section 8.13. Dr. Pannu and Midwest separately entered into an 

Ancillary Restrictive Covenant a year later. Then about ten 
No. 2016AP601

28

years later, in 2015, the dynamic and composition of the group 

changed and the parties purportedly entered into a Redemption 

Agreement, which contains a mutual release and indemnification 

as a part of winding down the business, provides for the 

surrender of Great Lakes and Dr. Pannu's membership in Midwest, 

and releases Great Lakes and Dr. Pannu from the 2005 and 2006 

restrictive covenants. The Redemption Agreement specifically 

supersedes "all prior agreements, promises, covenants, 

arrangements, communications, representations or warranties, 

whether oral or written" in its merger clause. 

¶53 A determination as to whether the issue of 

arbitrability is to be submitted to the arbitrator is examined 

in light of the pertinent contract. In order to determine 

whether the parties have always and forever agreed to arbitrate 

arbitrability by virtue of the JAMS Arbitration Rules in the 

Operating Agreement from 2005, as the court of appeals 

concluded, we must further examine the language of the 

contracts. "[N]o party can be compelled to arbitrate a matter 

which he or she has not agreed to submit to arbitration." 

Mortimore, 344 Wis. 2d 459, ¶15 (citing Cirilli, 322 

Wis. 2d 238, ¶12); see also Wis. Stat. ch. 788. 

¶54 While a court's role is limited, courts are indeed 

called upon to determine whether a contract calls for 

arbitration. Wis. Stat. §§ 788.01, 788.02, 788.03. Only then, 

if the forum chosen by the contract is arbitration, will the 

presumption of arbitrability control the dispute. Granite Rock 

Co., 561 U.S. at 301. Here, serious questions exist as to 
No. 2016AP601

29

whether the Operating Agreement still controls the issue of 

arbitrability, whether the Redemption Agreement supersedes that 

agreement, and to what extent, if any, one co-defendant, 

Dr. Pannu individually, ever agreed to arbitrate.

¶55 We now turn to the relevant contracts at issue. 

Dr. Pannu signed the 2005 Operating Agreement as President of 

Great Lakes, not individually. While the Operating Agreement 

contains a guaranty signed by Dr. Pannu, it is separate from the 

signature page of the Operating Agreement where he signed as 

President. The guaranty and acknowledgement serve to guaranty 

the obligations of the signator to the contract, Great Lakes. 

If the parties were only contesting the requirement to arbitrate 

under the Operating Agreement alone, the court's role would 

perhaps be different. See Wis. Stats. ch. 788. That, however, 

is not the question with which we are presented.

¶56 The parties demonstrated a willingness to later 

contract in 2006 concerning the individual restrictive covenant, 

outlined in the Ancillary Restrictive Covenant, which Dr. Pannu 

signed individually as a physician. The Ancillary Restrictive 

Covenant does not specifically contain an arbitration clause. 

Why a subsequent restrictive agreement was necessary in 2006 

might be an additional consideration for the court if these were 

the only two agreements at issue. This is not critical to our 

analysis, however, because the circuit court must first 

determine whether the Redemption Agreement is the parties' 

contract. The Redemption Agreement from a decade later is the 

only of the three documents at issue that sets forth by its 
No. 2016AP601

30

terms the distinct contractual obligations of Great Lakes the 

entity, and Dr. Pannu individually. The Redemption Agreement 

does not contain an arbitration provision and by its terms 

supersedes prior contracts and releases Great Lakes and 

Dr. Pannu from the non-compete restrictions. These conflicting 

written contractual provisions militate against the presumption 

of arbitrating arbitrability. The court is required by chapter 

788 of the Wisconsin Statutes to determine whether the contract 

calls for arbitration. In order to do so, it must determine 

which is the controlling contract. 

¶57 A closer examination of the terms of the contracts 

further explains why it cannot be assumed that the Operating 

Agreement alone ends the analysis as to arbitration. Most 

typically, a challenge might be made to a contractual clause, 

but the court nonetheless orders even that issue to arbitration 

because the pertinent contract calls for arbitration. Here, the 

language of the relevant documents call into question which of 

the contracts controls.

¶58 The combination of the merger clause in Section 10.2 

of the Redemption Agreement, the explicit reference to the 

Operating Agreement in the "Mutual Release" in Section 6, the 

"Applicable Law" provision in Section 10.3, and the nonexistence of an arbitration provision in the Redemption 

Agreement, make evident that, if enforceable, the parties did 

not consent to arbitration in the Redemption Agreement. If the 

Redemption Agreement revokes the Operating Agreement, the court 

would not order arbitration pursuant to the Operating Agreement. 
No. 2016AP601

31

¶59 Section 10.2 utilizes different capitalization to 

denote "this Agreement" (referring to the Redemption Agreement) 

and "the entire agreement," calling into question whether 

Midwest, Great Lakes, and Dr. Pannu intended the Redemption 

Agreement to revoke the Operating Agreement. The Redemption 

Agreement, unlike the Operating Agreement or the Ancillary 

Restrictive Covenant, addresses the relationship between all 

three. 

¶60 For example, the merger clause in Section 10.2 states 

that "[t]his Agreement" (meaning the Redemption Agreement)

constitutes the "entire agreement" between the "parties" 

(meaning Great Lakes, Dr. Pannu, and Midwest)21 "pertaining to 

its subject matter" and that it "supersedes all prior 

agreements, promises, covenants, arrangements, communications, 

representations, or warranties, whether oral or written, by 

[Great Lakes] or [Midwest]." It "expressly negatives 

collateral or antecedent understandings." See Town Bank v. City 

Real Estate Dev., LLC, 2010 WI 134, ¶39, 330 Wis. 2d 340, 793 

N.W.2d 476 (defining a merger clause as a "written provision 

which expressly negatives collateral or antecedent 

understandings"). No reference is made to the Arbitration 

section of the Operating Agreement.

 

21 Dr. Ahuja was only designated as a party "for purposes of 

the Mutual Releases and Indemnification set forth in Sections 6 

and 8," not Section 10.2.
No. 2016AP601

32

¶61 Furthermore, Section 6 of the Redemption Agreement by 

its terms is to "release, acquit and forever discharge" Great 

Lakes and Dr. Pannu from "any and all" "charges, complaints, 

claims, liabilities, obligations, promises, agreements, 

controversies, damages, actions, causes of action, suits, 

rights, demands, costs, losses, debts and expenses" of "any 

nature whatsoever" under "the Operating Agreement." The 

obligation or promise to "resolve any and all disputes arising 

with respect to the terms and conditions of this Operating 

Agreement . . . by arbitration" seemingly fits within this 

release. See Town Bank, 330 Wis. 2d 340, ¶46 (refusing to 

require contract drafters to "expressly identify and exclude in 

their contracts any prior oral or written communication between 

the parties that may rise to the level of an agreement").

¶62 In addition, the "Applicable Law" provisions in each 

of the agreements are different. The Operating Agreement's 

"Applicable Law" provision provides that the "Operating 

Agreement shall be governed by and construed in accordance with 

the laws of the State of Wisconsin without regard to its choice 

of law provisions." The arbitration clause in the Operating 

Agreement specifically incorporates the JAMS Arbitration Rules 

which state that "disputes over the formation, existence, 

validity, interpretation or scope of the agreement under which 

Arbitration is sought, and who are proper Parties to the 

Arbitration, shall be submitted to and ruled on by the 

Arbitrator" (emphases added). JAMS Comprehensive Arbitration 

Rules & Procedures, Rule 11(b), 14 (July 1, 2014), 
No. 2016AP601

33

https://www.jamsadr.com/files/Uploads/Documents/JAMS-Rules/JAMS_

comprehensive_arbitration_rules-2014.pdf. 

¶63 The Applicable Law section in the Redemption 

Agreement, on the other hand, is quite different. It contains 

no arbitration clause and states that "[a]ll questions 

concerning the construction, validity and interpretation of this 

Agreement and the performance of the obligations imposed by this 

Agreement shall be governed by the internal law, not the law of 

conflicts, of the State of Wisconsin" (emphases added). Simply 

stated, the applicable law and forum selection in one contract 

is very different from the other. 

¶64 Therefore, the Redemption Agreement, if enforceable, 

supersedes by its very language the Operating Agreement's mode 

of adjudication, including its incorporation of JAMS Arbitration 

Rules that granted the authority to the arbitrator to determine 

arbitrability. See Thomas W. Ward & Assoc., Inc. v. Spinks, 574 

So. 2d 169, 170 (Fla. Dist. Ct. App. 1990) (per curiam) (holding 

"the trial court cannot leave it to the arbitrators themselves 

to determine which claims are subject to arbitration when it has 

not established which agreement applies").

¶65 Due to the foregoing, Midwest and NEA failed to 

demonstrate "clear and unmistakable" intent to arbitrate. Riley 

Mfg. Co. v. Anchor Glass Container Corp., 157 F.3d 775, 780-81 

(10th Cir. 1998). Thus, the question of whether the parties 

agreed to arbitrate must, in this instance, be decided by the 

circuit court. See Wis. Stat. ch. 788; see also Riley Mfg. Co., 

157 F.3d at 780-81 (holding "the existence of the merger clause 
No. 2016AP601

34

in the Settlement Agreement [in combination with the lack of 

arbitration clause] raises at least an ambiguity on the question 

of the intent of the parties to allow an arbitrator to decide 

the validity of the 1991 arbitration clause" because it "raises 

legitimate questions as to the continuing existence and scope of 

the arbitration clause in the Manufacturing Agreement" and thus, 

"the question of whether an agreement to arbitrate continues to 

exist . . . is a question for the courts").

¶66 Consequently, this matter requires a judicial 

determination of "whether the parties consented to arbitrate the 

matters covered by the [arbitration] demand." Granite Rock Co., 

561 U.S. at 303 n.9 & 304 (referencing Buckeye Check Cashing, 

546 U.S. at 444 n.1). As will later be discussed, it is for the 

circuit court to further explore the validity and enforceability 

of the Redemption Agreement. 

3. Clarifying precedents

¶67 No Wisconsin or federal case establishes that once 

arbitration is contracted as the forum for dispute resolution, 

parties can never later contract for an alternative forum for 

dispute resolution. To the extent Cirilli, 322 Wis. 2d 238, and 

Mortimore, 344 Wis. 2d 459, are read as concluding that a 

contract to arbitrate is irrevocable, that interpretation is 

inconsistent with the law. Clearly, section 788.01 of the 

Wisconsin Arbitration Act contemplates that a court will enforce 

"[a] provision in any written contract to settle by arbitration 

a controversy thereafter arising out of the contract" and that 
No. 2016AP601

35

such contractual provision to arbitrate "shall be valid, 

irrevocable and enforceable except upon such grounds as exist at 

law or in equity for the revocation of a contract." Wis. Stat. 

§ 788.01 (emphasis added). Another contract that clearly and 

expressly supersedes a first contract is "grounds as exist at 

law or in equity for the revocation of a contract." Thus, 

Cirilli and Mortimore must not stand for the proposition that 

once parties contract for arbitration, that decision is always 

irrevocable. 

¶68 Midwest and NEA rely on Cirilli for the proposition 

that whether a subsequent agreement revokes the consent to 

arbitrate found in an earlier agreement is for an arbitrator to 

decide because it goes to the merits of the dispute. This, 

however, construes Cirilli too broadly. 

¶69 Cirilli, unlike this case, did not involve the same 

parties entering into a subsequent contract. 322 Wis. 2d 238, 

¶¶5, 8 n.2, 8-9, 15 n.6. Instead, in Cirilli, the plaintiffs 

claimed that a subsequent settlement the defendants reached with 

different parties released them from their duty to arbitrate 

under their original contract. Id., ¶¶1-2. Cirilli says 

nothing about whether parties can enter into a subsequent, 

superseding contract and agree to remove their disputes from 

arbitration. Moreover, Cirilli neither addresses nor concludes 

that there can never be "grounds as exist at law or in equity 

for the revocation of a contract." In the case at issue, unlike 

Cirilli, there is a dispute as to whether a second contract 

without an arbitration clause supersedes the first contract with 
No. 2016AP601

36

such a clause. As a result, unlike Cirilli, the determination 

of arbitrability, whether the Operating Agreement is an 

unrevoked contract, must be decided, in the first instance, by 

the circuit court rather than the arbitrator. 

¶70 Midwest and NEA also assert that Mortimore, a case 

where the court of appeals remanded the matter for arbitration, 

lends further support for their cause. See 344 Wis. 2d 459, ¶1. 

Midwest and NEA claim that there is no fundamental difference 

between the oral agreement in Mortimore and the Redemption 

Agreement here, because neither was fully executed. At a 

minimum, Midwest and NEA seemingly acknowledge, however, that 

there is a material factual dispute in both cases upon whether 

there was a binding subsequent agreement. 

¶71 In Mortimore, Mortimore's written employment contract 

(entered in 2004) contained an arbitration clause and prohibited 

oral modifications of the contract. Id., ¶3. Specifically, the 

contract stated that "[n]o amendment or modification of this 

Agreement shall be: valid or binding upon [Merge Technologies] 

unless made in writing and signed by an officer of [Merge 

Technologies] . . . or upon the Executive unless made in writing 

and signed by him." Id. In 2006 Merge Technologies and 

Mortimore began working towards drafting a new written contract 

for Mortimore. Id., ¶7. As of June 19, 2016, "two 

substantively different contract drafts were being edited by two 

different people——one draft was a new contract, the other 

amended Mortimore's 2004 contract." Id. A cover letter was 

prepared by the head of the compensation committee for one of 
No. 2016AP601

37

the contracts——which contained no arbitration clause——but the 

cover letter and the contract were never sent nor signed. Id. 

The following day Merge Technologies decided to not offer 

Mortimore a new contract for a period and eventually decided to 

seek his resignation instead. Id., ¶8.

¶72 Based on these facts, the court of appeals held that 

Merge Technologies and Mortimore had, through "a process of 

negotiation," agreed to an amendment or modification to 

Mortimore's 2004 employment contract. Id., ¶19. The court of 

appeals relied on the adoption of the Commercial Arbitration 

Rules of the American Arbitration Association as a "clear and 

unmistakable expression of the parties' intent to reserve the 

question of arbitrability for the arbitrator and not the court." 

Id., ¶20. This conclusion of the court of appeals however was 

based upon the fact that the "2004 contract contemplated that 

amendments or modifications, such as those negotiated between 

Mortimore and Merge [Technologies], would be enforceable and 

binding only if made in writing." Id., ¶19. Notably, despite 

this provision, "the record show[ed] that no such modifications 

or changes eliminating an arbitration requirement were ever made 

in writing." Id. The court of appeals concluded that 

Mortimore's "conten[tions] that this alleged oral agreement is 

enforceable . . . [and] his breach of contract claims are not 

subject to arbitration . . . is mistaken." Id., ¶18. Thus, 

Mortimore neither addresses nor concludes that once contracted 

for, there can never be "grounds as exist at law or in equity 

for the revocation of a contract." In the case at issue, unlike 
No. 2016AP601

38

Mortimore, there is a material factual dispute as to whether a 

second written contract, which does not have an arbitration 

clause, supersedes the first written contract which does, such 

that the determination of arbitrability here must first be 

decided by the circuit court rather than the arbitrator. 

¶73 In sum, Cirilli and Mortimore do not stand for the 

proposition that once parties contract for arbitration, that 

decision is always irrevocable. Even in Mortimore, the circuit 

court was called upon to determine whether the initial contract 

had been revoked. See Mortimore, 344 Wis. 2d 459, ¶19. 

Clearly, section 788.01 of the Wisconsin Arbitration Act 

contemplates that a court will enforce "[a] provision in any 

written contract to settle by arbitration a controversy 

thereafter arising out of the contract" and that such 

contractual provision to arbitrate "shall be valid, irrevocable 

and enforceable except upon such grounds as exist at law or in 

equity for the revocation of a contract." Wis. Stat. § 788.01. 

Another contract that clearly and expressly supersedes a first 

contract is "grounds as exist at law or in equity for the 

revocation of a contract." To the extent that language in 

Mortimore or Cirilli suggests that contracts to arbitrate are 

forever irrevocable, that language is limited by the facts of 

those cases.

¶74 Midwest and NEA also argue that Great Lakes and 

Dr. Pannu's challenge to the Operating Agreement is governed by 

Buckeye Check Cashing, 546 U.S. 440, and Prima Paint Corp. v. 

Flood & Conklin Mfg. Co., 388 U.S. 395 (1967), and that those 
No. 2016AP601

39

cases require the enforcement of the Operating Agreement.22 

Midwest and NEA argue that this is so because the challenge is 

not itself to the arbitration provision, but instead hinges on 

whether the Redemption Agreement superseded the Operating 

Agreement. See Buckeye Check Cashing, 546 U.S. at 445-46 

("[U]nless the challenge is to the arbitration clause itself, 

the issue of the contract's validity is considered by the 

arbitrator in the first instance."); Prima Paint, 388 U.S. at 

404 ("But the statutory language does not permit the federal 

court to consider claims of fraud in the inducement of the 

contract generally.").

¶75 The challenges in Buckeye Check Cashing and Prima 

Paint, however, are also distinguishable from the challenge in 

 

22 Midwest and NEA also allege that Buckeye Check Cashing, 

Inc. v. Cardegna, 546 U.S. 440 (2006), explained that "before 

formation" and "after formation" challenges (words that Midwest 

and NEA used, not the Supreme Court) should be treated 

differently because not to do so would "permit[] a court to deny 

effect to an arbitration provision in a contract that the court 

later finds to be perfectly enforceable." See Buckeye Check 

Cashing, 546 U.S. at 448–49. Midwest and NEA's argument 

completely lacks merit. Buckeye Check Cashing's explanation was 

in reference to why "a challenge to the validity of the contract 

as a whole, and not specifically to the arbitration clause, must 

go to the arbitrator." Id. at 449. It is unsurprising that 

Buckeye Check Cashing did not make a distinction between labels 

"before formation" and "after formation" as "it is not the mere 

labeling of a dispute . . . that determines whether an issue is 

arbitrable"; it is "whether the parties consented to arbitrate 

the dispute in question." Granite Rock Co. v. Int'l Bhd. of 

Teamsters, 561 U.S. 287, 304 n.11 (2010). Tellingly, if a court 

found a superseding agreement revoked the parties' consent to 

arbitrate, the court could not later find that the arbitration 

provision was enforceable.
No. 2016AP601

40

this case. In both Buckeye Check Cashing and Prima Paint there 

was only one contract. Neither of the parties' challenges went 

to the subsequent contracting out of arbitration. In Buckeye 

Check Cashing, the parties resisting arbitration alleged that 

"the contract as a whole (including its arbitration provision) 

[was] rendered invalid by [a] usurious finance charge" that was 

in violation of various laws. 546 U.S. at 443-44. The parties, 

however, acknowledged that they "concluded" an agreement to 

arbitrate and never alleged that the finance charge impacted or 

revoked their consent to arbitrate. See id. at 444 n.1; Granite 

Rock Co., 561 U.S. at 300-01. 

¶76 Similarly, in Prima Paint, the parties resisting 

arbitration alleged that the entire contract should be rescinded 

because they were fraudulently induced into entering the 

contract as whole, but "no claim [was] advanced by [the 

resisting party] that [the other party] fraudulently induced it 

to enter into the agreement to arbitrate." 388 U.S. at 398-99, 

406. Here, however, Great Lakes and Dr. Pannu argue that the 

Redemption Agreement superseded the Operating Agreement. In 

fact, it is because of this genuine issue of material fact that 

we send this matter back for further determination. See, e.g., 

Joint Sch. Dist. No. 10, 78 Wis. 2d at 101 ("For arbitration is 

a matter of contract and a party cannot be required to submit to 

arbitration any dispute which he has not agreed so to submit." 

(quoting United Steelworkers, 363 U.S. at 582)). Thus, neither 

Buckeye Check Cashing nor Prima Paint address nor prohibit 
No. 2016AP601

41

parties from subsequently contracting out of arbitration as the 

forum of dispute resolution.

¶77 Finally, fundamental principles of freedom to contract 

support the proposition that parties can subsequently contract 

to modify the terms of a previous contract. In fact, here, 

various parties in various capacities did contract in 2005 and 

2006. Contracts can involve mutual agreement to change certain 

obligations, including a duty to arbitrate. Wisconsin law, 

including Wis. Stat. ch. 788, does not limit such freedom to 

contract, but rather chapter 788 reinforces the freedom of 

contract by enforcing parties' contractual agreements. In fact, 

this view comports with the Federal Arbitration Act if "grounds 

exist at law or in equity for the revocation of any contract" 

and places "arbitration agreements 'on equal footing with all 

other contracts.'" Kindred Nursing Ctrs., 137 S. Ct. at 1424; 

Wis. Stat. § 788.01; see, e.g., Sipple v. Zimmerman, 39 

Wis. 2d 481, 492, 159 N.W.2d 706 (1968) ("The contract was 

legally binding unless mutually rescinded by the parties to 

it."); Town Bank, 330 Wis. 2d 340, ¶39 (describing the fact that 

"when [a] contract contains an unambiguous merger or integration 

clause, the court is barred from considering evidence of any 

prior or contemporaneous understandings or agreements between 

the parties" as a "principle [that] stems from basic contract 

law"). Courts should remain mindful of the limited role endowed 

to them under chapter 788 and not endeavor into the province of 

the parties' contractual choice to arbitrate. 
No. 2016AP601

42

¶78 The notion that no parties can ever contract out of 

arbitration is antithetical to these values and principles than 

the idea of a prohibition on contracting out of arbitration 

through mutual agreement and thus, a 

"limitless . . . contractual obligation to arbitrate." Litton 

Fin. Printing Div. v. NLRB, 501 U.S. 190, 209 (1991); see id.

("[The United States Supreme Court] refuse[d] to apply [the] 

presumption [of arbitrability] wholesale in the context of an 

expired bargaining agreement, for to do so would make limitless 

the contractual obligation to arbitrate" and "determine[d] 

whether the parties agreed to arbitrate this dispute" because a 

court "cannot avoid that duty because it requires us to 

interpret a provision of a bargaining agreement."). Neither 

Cirilli, Mortimore, Buckeye Check Cashing, nor Prima Paint

require a competing result under these facts. Therefore, this 

court's conclusion that a party can subsequently contract out of 

the obligation to arbitrate is not only consistent with federal 

and Wisconsin law, it is also necessitated by the fundamental 

principles underlying freedom to contract.

B. Summary Judgment

¶79 Finally, we briefly address why we remand this case to 

the circuit court. The principles of summary judgment are welldefined. Summary judgment is granted if "the pleadings, 

depositions, answers to interrogatories, and admissions on file, 

together with the affidavits, if any, show that there is no 

genuine issue as to any material fact and that the moving party 
No. 2016AP601

43

is entitled to a judgment as a matter of law." Wis. Stat. 

§ 802.08(2); Hirschhorn, 338 Wis. 2d 761, ¶20. Stated 

differently, summary judgment should not be granted "unless the 

facts presented conclusively show that the plaintiff's action 

has no merit and cannot be maintained." Mrozek v. Intra Fin. 

Corp., 2005 WI 73, ¶14, 281 Wis. 2d 448, 699 N.W.2d 54.

¶80 In determining whether to grant summary judgment, "the 

court decides whether there is a genuine issue of material fact; 

the court does not decide the fact." Racine Cty., 323 

Wis. 2d 682, ¶25. The moving party bears the burden of 

establishing the absence of a genuine, that is, disputed, issue 

of material fact. AccuWeb, Inc. v. Foley & Lardner, 2008 WI 24, 

¶21, 308 Wis. 2d 258, 746 N.W.2d 447; Grams v. Boss, 97 

Wis. 2d 332, 338, 294 N.W.2d 473 (1980). Moreover, we view 

summary judgment materials in the light most favorable to the 

non-moving party. AccuWeb, 308 Wis. 2d 258, ¶21. A factual 

issue is "genuine" if the evidence is such that a reasonable 

jury could return a verdict in favor of the non-moving party. 

Baxter v. DNR, 165 Wis. 2d 298, 312, 477 N.W.2d 648 (Ct. App. 

1991). A "material fact" is one that is "of consequence to the 

merits of the litigation." Michael R.B. v. State, 175 

Wis. 2d 713, 724, 499 N.W.2d 641 (1993). "Any reasonable doubt 

as to the existence of a genuine issue of material fact must be 

resolved against the moving party" for summary judgment. Heck & 

Paetow Claim Serv., Inc. v. Heck, 93 Wis. 2d 349, 356, 286 

N.W.2d 831 (1980).
No. 2016AP601

44

¶81 The question that was before the circuit court on 

summary judgment was whether the Redemption Agreement was a 

valid and enforceable contract. Competing affidavits were 

submitted which presented genuine issues of material fact.

¶82 Nonetheless, the circuit court granted summary 

judgment in favor of Great Lakes and Dr. Pannu concluding that 

the Redemption Agreement was validly formed. The circuit court 

found that Dr. Ahuja, through Midwest's attorney, made an offer 

that he intended to be bound by when the e-mail containing the 

"final agreement" was sent, and that Dr. Pannu accepted the 

offer when he signed the Redemption Agreement and returned it 

with the check that was subsequently cashed. Prior to granting 

summary judgment, however, the circuit court acknowledged that 

"maybe there[ are] some" factual disputes. 

¶83 In this case, we conclude that the circuit court 

improperly granted summary judgment to Great Lakes and 

Dr. Pannu. In support of their competing motions, the parties

presented affidavits attempting to demonstrate their mutual 

assent, or lack thereof, to forming the Redemption Agreement. 

See Wis. Stat. § 802.08(2) (precluding summary judgment if there 

is a "genuine issue as to any material fact" (emphasis added)).

¶84 In support of the position that the Redemption 

Agreement was validly formed and is enforceable, Dr. Pannu 

submitted an affidavit representing that Great Lakes and 

Dr. Pannu had performed all of their obligations under the 

Redemption Agreement other than moving out of their office by 

April 8, 2015, including delivering a check that was 
No. 2016AP601

45

subsequently cashed. That evidence, however, was refuted by 

Dr. Ahuja's affidavit. Dr. Ahuja asserted that the check was 

cashed in error by a clerical employee, and that a cashier's 

check in the same amount was sent to Dr. Pannu once the error 

was discovered. Further, Dr. Ahuja asserted that he had never 

agreed to the terms of the Redemption Agreement; had never 

instructed Midwest's attorney to include a complete release of 

Great Lakes' or Dr. Pannu's non-compete obligations in the 

Redemption Agreement, and in fact disagreed with releasing the 

restrictions; and that in April he told Dr. Pannu in a phone 

conversation about signing the Redemption Agreement that he was 

still reviewing it and shortly after the phone call determined 

that he was not willing to sign it. He noted that the agreement 

does not contain his signature. 

¶85 At a minimum, these competing affidavits raise genuine 

issues of material fact rendering summary judgment improper. 

Hence, we reverse and remand the cause to the circuit court.

V. CONCLUSION

¶86 The crux of the issue before us concerns the circuit 

court's role in determining the proper forum of dispute 

resolution when a subsequent contract, if enforceable, does not 

contain an arbitration clause as is present in an initial 

contract. As a part of that analysis we consider whether a 

contract which contains a merger clause and which does not 

contain an arbitration clause can change the forum of dispute 

resolution when a prior agreement between the parties contains
No. 2016AP601

46

an arbitration clause. The parties make competing arguments 

regarding a court's role in determining the applicability of 

this arbitration provision. They take contrary positions 

regarding whether all disputes, even arbitrability itself, must 

be submitted to arbitration. The parties present conflicting 

views of precedent regarding the judiciary's role in deciding 

motions to compel arbitration when a subsequent contract does 

not select arbitration as the forum for dispute resolution and 

does contain a merger clause which states that the subsequent 

agreement supersedes all prior contracts. Relatedly, the 

parties dispute whether all parties here can be compelled to 

arbitrate when arguably only one co-defendant is contractually 

required to arbitrate pursuant to the initial contract. 

¶87 The claims in the underlying lawsuit that called upon 

the court to decide whether the dispute belonged in arbitration, 

involve whether Great Lakes and Dr. Pannu violated restrictive 

covenants in the Operating Agreement and the Ancillary 

Restrictive Covenant. The Redemption Agreement, however, does 

not contain an arbitration provision and in fact, purports to 

release those restrictive covenants. Therefore, which contract 

controls is seminal in the first instance as to whether 

arbitration should be ordered. Ultimately, regardless of forum, 

the controlling documents will also impact the underlying 

dispute itself. 

¶88 The circuit court concluded on summary judgment that 

even though the initial agreement, here the Operating Agreement, 

required arbitration it was superseded by a later, valid and 
No. 2016AP601

47

enforceable Redemption Agreement which did not so require the 

parties to submit to arbitration. The court of appeals reversed 

and remanded with instructions to grant Midwest's motion to 

compel arbitration. 

¶89 We reverse the court of appeals and conclude that the 

fundamental principles of freedom to contract allow parties to a 

previous contract to subsequently contract for a different forum 

of dispute resolution. Here, it is necessary that the circuit 

court initially determine whether the parties contracted to 

arbitrate. The court's authority to order arbitration is 

dependent on the terms of a contract. If the Redemption 

Agreement is the parties' contract, then the court lacks 

authority to order arbitration. Thus, the court must first 

ascertain which contract controls the forum of dispute 

resolution. In sum, we conclude that it is a court's duty to 

determine whether a contract calls for arbitration and when a 

dispute exists as to whether a second contract without an 

arbitration clause supersedes a first contract with such a 

clause, the determination of arbitrability must be decided in 

the first instance by the circuit court rather than the 

arbitrator.

¶90 We also conclude, however, that the cause must be 

remanded to the circuit court, not to compel arbitration as was 

ordered by the court of appeals, but rather, because the 

parties' competing affidavits submitted in support of their 

positions on summary judgment raised genuine issues of material 

fact concerning whether the Redemption Agreement is a valid 
No. 2016AP601

48

contract. Therefore, we reverse and remand to the circuit court 

for further proceedings.

By the Court.—The decision of the court of appeals is 

reversed, and the cause is remanded to the circuit court for 

further proceedings consistent with this opinion.

¶91 REBECCA FRANK DALLET, J., withdrew from participation.
No. 2016AP601.ssa

1

¶92 SHIRLEY S. ABRAHAMSON, J. (concurring). There are 

two primary agreements in the instant case. The Operating 

Agreement says that all disputes will be submitted to 

arbitration and issues of substantive arbitrability will also be 

decided by the arbitrator. The Redemption Agreement purports to 

release Great Lakes and Pannu from any and all obligations 

imposed upon them by the Operating Agreement, including any 

agreement to arbitrate disputes.

¶93 The legal issues about which the parties disagree are 

the effect of the Redemption Agreement on the Operating 

Agreement and whether the Redemption Agreement is a valid 

contract.

¶94 I agree with the majority that, if valid, the 

Redemption Agreement releases Great Lakes and Pannu from the 

agreement to arbitrate contained in the Operating Agreement, and 

that the cause should be remanded to the circuit court to 

determine whether the Redemption Agreement is a valid contract.

¶95 However, I write separately because the majority fails 

to set forth a clear analytical framework through which the 

legal issues presented in the instant case should be resolved 

and mishandles federal case law in the process. Additionally, 

the majority stumbles in its application of the law to the facts 

in such a way that warrants both clarification and correction.

I

¶96 Although they are not binding on this court, several 

decisions by the federal circuit courts of appeals have 
No. 2016AP601.ssa

2

addressed the issue presented by the instant case.1 Of these 

cases, Dasher v. RBC Bank (USA), 745 F.3d 1111 (11th Cir. 2014), 

is the most helpful and worthy of special consideration.

¶97 In Dasher, Dasher sued the bank for allegedly charging 

excessive overdraft fees in breach of his 2008 account 

agreement. The 2008 Agreement contained an arbitration clause. 

In 2012, a new account agreement was issued and Dasher accepted 

that agreement. The 2012 Agreement did not contain an 

arbitration clause. When the bank moved to compel arbitration 

per the 2008 Agreement's arbitration clause, an issue arose as 

to whether that clause was effective, given that the 2012 

Agreement had superseded the 2008 Agreement.

¶98 The Dasher court rejected the bank's argument that an 

arbitration clause in an entirely superseded agreement remains 

effective unless specifically eliminated in the superseding 

agreement. The Dasher court explained that "[d]espite [the 

language in the cases cited by RBC], which certainly appears to 

support RBC's contention, closer examination reveals a critical 

distinction: in each case cited by RBC, the prior agreement 

remained effective to some extent for various reasons, whereas 

 

1 See, e.g., Dasher v. RBC Bank (USA), 745 F.3d 1111 (11th 

Cir. 2014); Dottore v. Huntington Nat'l Bank, No. 1:09-cv-2636, 

2010 WL 3861010 (N.D. Ohio Sept. 28, 2010), aff'd, 480 Fed. 

Appx. 351 (6th Cir. 2012); Applied Energetics, Inc. v. NewOak 

Capital Mkts., LLC, 645 F.3d 522 (2d Cir. 2011); Bank Julius 

Baer & Co., Ltd. v. Waxfield Ltd., 424 F.3d 278 (2d Cir. 2005); 

Riley Mfg. Co., Inc. v. Anchor Glass Container Corp, 157 

F.3d 775 (10th Cir. 1998); Patten Sec. Corp., Inc. v. Diamond 

Greyhound & Genetics, Inc., 819 F.2d 400 (3d Cir. 1987); 

Matterhorn, Inc. v. NCR Corp., 763 F.2d 866 (7th Cir. 1985).
No. 2016AP601.ssa

3

here, the prior agreement is entirely superseded."2 The cases 

cited by the bank could not stand for the proposition that 

arbitration clauses in entirely superseded agreements remain 

effective unless specifically eliminated because none of those 

cases dealt with an entirely superseded agreement.3

¶99 In my view, the Dasher case persuasively articulates 

the correct analytical framework. 

¶100 Whether, and to what extent, a second contract 

supersedes a prior contract containing an arbitration clause 

such that the prior contract's arbitration clause is rendered 

ineffective is an issue that must be decided by the court rather 

than an arbitrator. The assertion that the prior contract's

arbitration clause was superseded calls into question the 

enforceability of the arbitration clause specifically, including 

the agreement to arbitrate issues of substantive arbitrability.4

¶101 In determining whether, and to what extent, a 

subsequent contract supersedes a prior contract, the court 

"should apply ordinary state-law principles that govern the 

 

2 Dasher, 745 F.3d at 1120.

3 Id.

4 Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440, 444 

& n.1 (2006) (stating that a party resisting arbitration may 

dispute that an agreement to arbitrate "ever concluded" or 

"challenge[] specifically the validity of the agreement to 

arbitrate"); Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 

U.S. 395, 402-04 (1967); see also Granite Rock Co. v. Int'l Bhd. 

of Teamsters, 561 U.S. 287, 297-300 (2010).
No. 2016AP601.ssa

4

formation of contracts."5 "If the subsequent agreement only 

partially supersedes the prior agreement, amends it, or waives 

some but not all of its provisions, the second question is 

whether the arbitration provision was among the superseded, 

amended, or waived provisions."6 If, however, the subsequent 

agreement entirely supersedes the prior agreement, the court 

should determine "whether the subsequent agreement alone

supports a motion to compel arbitration."7

II

¶102 I now apply the relevant state-law principles that 

govern the formation of contracts. 

¶103 The Wisconsin Arbitration Act provides, in pertinent 

part, that arbitration clauses "shall be valid, irrevocable and 

enforceable except upon such grounds as exist at law or in 

equity for the revocation of any contract."8 A subsequent 

contract that supersedes a prior contract constitutes "grounds 

as exist at law or in equity for the revocation of any 

contract."9 The question, then, is whether, and to what extent, 

the Redemption Agreement, the second contract, supersedes the 

Operating Agreement, the first contract.

 

5 First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 

944 (1995)

6 Dasher, 745 F.3d at 1122.

7 Id. at 1123.

8 Wis. Stat. § 788.01.

9 Majority op., ¶47.
No. 2016AP601.ssa

5

¶104 A subsequent agreement's supersession of a prior 

agreement is typically accomplished by including a merger clause 

in the subsequent agreement. In Wisconsin, this court stated 

the following with respect to merger clauses: 

[The appellant] argues . . . that an exception exists 

to the general rule that parol evidence is admissible 

with respect to the issue of integration; that 

evidence of contemporaneous or prior agreements, 

written or oral, which relate to the same subject 

matter as the agreement in question is not admissible 

when the written agreement embodies written terms 

excluding additional understandings or agreements not 

contained in the writing, i.e., 'merger' clauses. 

With this much we can agree. Absent claims of duress, 

fraud, or mutual mistake, a written provision which 

expressly negatives collateral or antecedent 

understandings makes the document a complete 

integration.10

¶105 A recent decision concerning merger clauses and 

supersession of contracts, Town Bank v. City Real Estate 

Development, LLC, 2010 WI 134, 330 Wis. 2d 340, 793 N.W.2d 476, 

is instructive in resolving the dispute in the instant case. 

¶106 Town Bank involved a two-phase financing agreement 

between a bank and a developer for the purchase and 

redevelopment of a building in downtown Milwaukee. A Commitment 

Letter pledged financing for both phases of the project, but a 

subsequent Term Credit Agreement (TCA) executed by the parties 

provided financing for only the first phase. The TCA contained 

the following clause:

 

10 Dairyland Equip. Leasing, Inc. v. Bohen, 94 Wis. 2d 600, 

855-56, 288 N.W.2d 852 (1980); see also Matthew v. Am. Family 

Mut. Ins. Co., 54 Wis. 2d 336, 341-42, 195 N.W.2d 611 (1972). 
No. 2016AP601.ssa

6

This Agreement, including the Exhibits attached or 

referring to it, the Note and the Security Documents, 

are intended by Customer and Lender as a final 

expression of their agreement and as a complete and 

exclusive statement of its terms, there being no 

conditions to the full effectiveness of their 

agreement except as set forth in this Agreement, the 

Note and the Security Documents.11

¶107 The bank provided the first phase of financing as 

provided by the TCA, but refused to finance the second phase as 

referenced in the Commitment Letter. The bank sued the 

developer seeking a declaratory judgment that the bank was not 

obligated to provide additional funding to the developer.

¶108 The Town Bank court concluded that because the TCA 

contained an unambiguous merger clause, quoted above, the 

developer was precluded from introducing any evidence of prior 

understandings or agreements that may have existed between the 

parties, including the Commitment Letter.12 

¶109 Implicit in the court's holding was the conclusion 

that the TCA and Commitment Letter related to the same subject 

matter. That is, the Town Bank court (incorrectly, in my view) 

must have concluded that the TCA was the final expression of the 

parties' financing agreement altogether, as opposed to being the 

final expression of only the first phase of financing. Were 

this not the case, Town Bank would stand for the absurd 

proposition that a fully integrated contract with respect to one 

subject can extinguish contracts between the same parties with 

 

11 Town Bank v. City Real Estate Dev., LLC, 2010 WI 134, 

¶14, 330 Wis. 2d 340, 793 N.W.2d 476.

12 Id., ¶¶40-41.
No. 2016AP601.ssa

7

respect to entirely unrelated subjects.13 This is not, and has 

never been, how merger clauses operate in Wisconsin or 

elsewhere.14

¶110 Thus, with these state-law principles in mind, I turn 

to whether, and to what extent, the Redemption Agreement, if 

valid, supersedes the Operating Agreement.

III

¶111 The majority suggests that, if valid, the Redemption 

Agreement supersedes the Operating Agreement in its entirety.15 

The Redemption Agreement does no such thing.

¶112 The merger clause in the Redemption Agreement states 

that the Redemption Agreement "constitutes the entire agreement 

between the parties pertaining to its subject matter and 

supersedes all prior agreements, promises, covenants, 

arrangements, communications, representations or warranties, 

whether oral or written, by [Great Lakes] or [Midwest]." 

(Emphasis added.)

¶113 Is the "subject matter" of the Redemption Agreement

identical to the "subject matter" of the Operating Agreement 

such that the former entirely supersedes the latter? The answer 

is clearly, "No."

 

13 Id., ¶¶68-72 & nn.10-13 (A.W. Bradley, J., dissenting).

14 Dairyland, 94 Wis. 2d at 608-09; Matthew, 54 Wis. 2d at 

341-42; 11 Richard A. Lord, Williston on Contracts § 33:14 (4th 

ed. 2002); Restatement (Second) of Contracts § 213.

15 See majority op., ¶¶47, 56, 64, 67, 75.
No. 2016AP601.ssa

8

¶114 The Operating Agreement's purpose is to provide "the 

rights, obligations, and restrictions" that will apply to 

Midwest and its Members. Within its scope are the subjects of 

capital contributions, tax distributions, allocations of profits 

and losses, the authority and powers of Midwest's officers and 

Members, etc. It is a document that governs the internal 

operations of Midwest. On the other hand, the Redemption 

Agreement's purpose is to "set forth the terms upon which [Great 

Lakes] will sell and [Midwest] will redeem [Great Lakes'] entire 

Membership Interest[.]" It does not purport in any way to alter 

or address the internal operations of Midwest and how those 

operations are to be governed.

¶115 Although there is some overlap in subject matter 

between the Operating Agreement and Redemption Agreement (e.g., 

how Great Lakes' Membership Interest is calculated and paid 

out), the subject matter of the agreements is not identical.

¶116 The Redemption Agreement, if valid, would not entirely

revoke the Operating Agreement as the majority suggests.16 Even 

if the Redemption Agreement is valid, the Operating Agreement 

will still have binding effect on Midwest and all of its Members 

even if it will no longer have any binding effect on Great Lakes 

or Pannu. Would Midwest lack a written agreement as to its 

 

16 At ¶¶59-60, the majority appears to read the merger 

clause in a way that is untethered to the subject matter of the 

Redemption Agreement. This suggestion gives further support to 

the absurd proposition that merger clauses have the effect of 

extinguishing prior agreements between the parties unrelated to 

the subject matter of the contract in which the merger clause is 

contained. See supra ¶108 and notes 13-14.
No. 2016AP601.ssa

9

internal operations simply because it agreed to allow the 

voluntary dissociation of a Member and release that Member from 

obligations imposed by the Operating Agreement? I think not.

¶117 Indeed, we have an example of an entirely superseded 

contract in the instant case, namely, the 2002 Original 

Operating Agreement. Section 1.4 of the 2005 Operating 

Agreement states: "This Operating Agreement and the terms 

hereof supersede and replace the Original Agreement and its 

terms." There is no ambiguity——the 2005 Operating Agreement 

completely and entirely extinguished the terms of the 2002 

Original Operating Agreement. If Midwest had intended the 

Redemption Agreement to entirely supersede the Operating 

Agreement, one would expect to see language similar to what 

Midwest used to entirely supersede the 2002 Original Operating 

Agreement.

¶118 Thus, if valid, the Redemption Agreement does not 

entirely supersede the Operating Agreement. However, that does 

not end the inquiry. The court must also determine if the 

Redemption Agreement supersedes the Operating Agreement at all, 

and if so, whether the Operating Agreement's arbitration clause 

is one of the superseded provisions.

¶119 The majority asserts that the Applicable Law provision 

of the Redemption Agreement expressly supersedes "the Operating 

Agreement's mode of adjudication, including its incorporation of 

JAMS Arbitration Rules that granted the authority to the 

arbitrator to determine arbitrability."17

 

17 Majority op., ¶64.
No. 2016AP601.ssa

10

¶120 The majority's assertion incorrectly conflates choiceof-law provisions and arbitration clauses. Providing that 

questions concerning the construction of a contract shall be 

governed by Wisconsin law says nothing about the forum in which 

those questions will be decided. 

¶121 The majority finally finds its footing when it reaches 

the Mutual Release provision of the Redemption Agreement. I 

agree with the majority that "[t]he obligation or promise to 

'resolve any and all disputes arising with respect to the terms 

and conditions of this Operating Agreement . . . by arbitration' 

seemingly fits within this release."18

¶122 Asserting that a subsequent contract released the 

resisting party from its obligation to submit disputes to 

arbitration is exactly the type of specific challenge to the 

enforceability of a validly formed arbitration clause that the 

United States Supreme Court requires.19 Great Lakes and Pannu do 

not argue that the arbitration clause in the Operating Agreement 

was invalidly formed. Rather, they argue that the arbitration 

clause in the Operating Agreement cannot be enforced because the 

 

18 Id., ¶61.

19 Buckeye, 546 U.S. at 444 & n.1; Prima Paint, 388 U.S. at 

402-04; see also Granite Rock, 561 U.S. at 297-300.
No. 2016AP601.ssa

11

Mutual Release provision specifically revokes any obligation on 

their part to submit to arbitration.20

IV

¶123 The majority's focus on the principles undergirding 

freedom of contract is not misplaced or inappropriate——those 

principles support the majority's conclusion that parties that 

agreed to arbitrate disputes may undo that agreement if they so 

choose. However, these principles alone do not provide a clear 

analytical framework through which the legal issue presented in 

the instant case should be resolved

¶124 I would articulate that framework as follows.

¶125 Whether, and to what extent, a second contract 

supersedes a prior contract containing an arbitration clause 

such that the prior contract's arbitration clause is rendered 

ineffective is an issue that must be decided by the court rather 

than an arbitrator. The assertion that the prior contract's 

arbitration clause was superseded calls into question the 

enforceability of the arbitration clause specifically, including 

the agreement to arbitrate issues of substantive arbitrability. 

¶126 In determining whether, and to what extent, a 

subsequent contract supersedes a prior contract, the court 

 

20 Puzzlingly, the majority calls into question this 

framework. See majority op., ¶74 n.22. To be clear, Supreme 

Court precedent establishes two ways in which arbitration 

clauses may be challenged in and resolved by a court. The 

resisting party may dispute that an agreement to arbitrate "ever 

concluded," Buckeye, 546 U.S. at 444 n.1, or "challenge[] 

specifically the validity of the agreement to arbitrate" as 

Great Lakes and Pannu do in the instant case, Buckeye, 546 U.S. 

at 444-45.
No. 2016AP601.ssa

12

should apply ordinary state-law principles that govern the 

formation of contracts. If the subsequent contract only 

partially supersedes the prior contract, amends it, or waives 

some but not all of its provisions, the second question is 

whether the arbitration provision was among the superseded, 

amended, or waived provisions. If, however, the subsequent 

contract entirely supersedes the prior contract, the court 

should determine whether the subsequent contract alone supports 

a motion to compel arbitration.

¶127 In the instant case, it appears that the purpose of 

the Redemption Agreement was not to nullify or extinguish the 

Operating Agreement in its entirety. Rather, the Redemption 

Agreement sets forth the terms upon which Great Lakes will cease 

to be a Member of Midwest and release Great Lakes and Pannu from 

any and all obligations that the Operating Agreement might have 

imposed upon them, including the obligation to submit disputes 

arising out of the Operating Agreement to arbitration and to 

allow the arbitrators to decide issues of substantive 

arbitrability.

¶128 However, there is a genuine issue of material fact 

with regard to whether the Redemption Agreement is a valid 

contract. Thus, the cause should be remanded to the circuit 

court for the determination of this issue.
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¶129 REBECCA GRASSL BRADLEY, J. (dissenting). The 

majority nullifies the parties' arbitration agreement by 

creating a new rule bestowing on the judiciary the power to 

decide arbitrability even though the parties agreed an 

arbitrator would resolve this issue. Ironically, the majority 

invokes "fundamental principles of freedom to contract"1 but 

nonetheless infringes on the contracting rights of private 

parties and expands the statutorily limited role of the courts 

when parties contract for arbitration. I would honor the 

parties' contractual agreement to let the arbitrator decide 

what, if any, impact the partially-executed Redemption Agreement 

had on the existence and validity of the Operating Agreement.

¶130 Because the parties dispute the formation of the 

Redemption Agreement as well as its effect on the continued 

existence of the Operating Agreement, this court must apply the 

rules the parties agreed to follow under their existing 

contract, for "any and all disputes arising with respect to the 

terms and conditions of this Operating Agreement." See

Operating Agreement, § 13.7. The dispute here is whether the 

Redemption Agreement supersedes the Operating Agreement as to 

Great Lakes and Dr. Pannu, thereby eliminating the arbitration 

provision. This presents an issue of substantive arbitrability, 

which the parties contractually agreed to have the arbitrator 

decide. The majority acknowledges (albeit in a footnote) that 

"[t]he JAMS Arbitration Rules in the Operating 

 

1 Majority op., ¶5.
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Agreement . . . require that even the issue of arbitrability be 

arbitrated"

2 but overrides the parties' chosen method of dispute 

resolution anyway.3 I would instead respect the parties' 

contract, affirm the court of appeals, and remand the matter to 

the circuit court with directions to send the case to the 

arbitrator for resolution of this preliminary dispute.4 I 

respectfully dissent.

 

2 Majority op., ¶2 n.2. "JAMS" is an acronym for Judicial 

Arbitration and Mediation Services, Inc.

3 While the foundation of the majority's preference for 

court resolution of arbitrability disputes is unclear, its 

disdain for arbitration as a method of dispute resolution is 

transparent in its declaration that "only those disputes that 

the parties have agreed to so submit to arbitration are 

relegated to proceed in that forum." Majority op., ¶43 

(emphasis added). The majority misunderstands that the choice 

of method for dispute resolution belongs to the parties, not the 

court.

4 The arbitrator would first decide arbitrability, which 

involves two inquiries: (1) "whether there is a construction of 

the arbitration clause that would cover the grievance on its 

face" and (2) "whether any other provision of the contract 

specifically excludes it." Joint Sch. Dist. No. 10 v. Jefferson 

Educ. Ass'n, 78 Wis. 2d 94, 111, 253 N.W.2d 536 (1977). In this 

case, no party challenges the applicability of the arbitration 

clause in and of itself; rather, Great Lakes and Dr. Pannu 

dispute its enforceability, alleging that a second contract 

eliminated the arbitration provision. If the arbitrator 

determines that the arbitration clause in the Operating 

Agreement no longer exists or is invalidated by the Redemption 

Agreement, this case returns to court for ultimate disposition 

of the underlying issue. If the arbitrator determines the 

Redemption Agreement was never formed, the non-compete issue 

would be resolved in an arbitration of the merits. 
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I

¶131 Principles governing arbitration disputes are rather 

straightforward and should have controlled the disposition of 

this case. First, Wis. Stat. § 788.01 (2015-16) recognizes

that:

A provision in any written contract to settle by 

arbitration a controversy thereafter arising out of 

the contract, or out of the refusal to perform the 

whole or any part of the contract . . . shall be 

valid, irrevocable and enforceable except upon such 

grounds as exist at law or in equity for the 

revocation of any contract.

Wisconsin has a longstanding "policy of encouraging arbitration 

as an alternative to litigation," First Weber Grp., Inc. v. 

Synergy Real Estate Grp., LLC, 2015 WI 34, ¶24, 361 Wis. 2d 496, 

860 N.W.2d 498 (quoted source omitted), and "[t]here is a strong 

presumption of arbitrability where the contract in question 

contains an arbitration clause," Cirilli v. Country Ins. & Fin. 

Servs., 2009 WI App 167, ¶14, 322 Wis. 2d 238, 776 N.W.2d 272.

¶132 Second, the circuit court generally decides 

arbitrability unless the parties contract to have the arbitrator 

decide it, as they have done here. See First Weber Grp., Inc., 

361 Wis. 2d 496, ¶36. The arbitrability issue addresses whether 

the parties agreed to submit a dispute to arbitration. See

Kimberly Area Sch. Dist. v. Zdanovec, 222 Wis. 2d 27, 37, 586 

N.W.2d 41 (Ct. App. 1998). When parties "clearly and 

unmistakably" contract to have arbitrability decided by the 

arbitrator, the circuit court must honor the parties' choice. 

See AT&T Techs., Inc. v. Commc'ns. Workers of Am., 475 U.S. 643, 

649 (1986). When the parties specifically incorporate the JAMS' 
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Arbitration Rules in their contract, the court views their 

inclusion as a clear and unmistakable agreement to remove the 

arbitrability determination from the circuit court and place it 

with the arbitrator. Mortimore v. Merge Techs., 2012 WI App 

109, ¶20, 344 Wis. 2d 459, 824 N.W.2d 155; Oracle Am., Inc. v. 

Myriad Grp. A.G., 724 F.3d 1069, 1074 (9th Cir. 2013) 

("Virtually every circuit to have considered the issue has 

determined that incorporation of [formal] arbitration rules 

constitutes clear and unmistakable evidence that the parties 

agreed to arbitrate arbitrability.").

¶133 Finally, as the majority recognizes,5 Chapter 788 

prescribes a limited role for the courts over arbitration 

proceedings, enumerating specific judicial powers. Notably 

absent from this narrow conferral of judicial authority is the 

power to remove decisions over arbitrability from the arbitrator 

when the parties contractually assigned that issue to the 

arbitrator alone.

II

¶134 Applying these rules, the answer is obvious: whether 

these parties will arbitrate their underlying dispute must be 

decided by the arbitrator. The Operating Agreement upon which 

Midwest bases its non-compete claim against Great Lakes and Dr. 

Pannu contains an arbitration clause, which plainly incorporates 

JAMS Arbitration Rules:

 

5 Majority op., ¶46.
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Section 13.7. Arbitration. With the exception of 

any decision made by Midwest pursuant to the terms of 

Section 5.5 hereof ["Appointment of and Powers of the 

Company President."] (which shall be deemed final), 

the parties hereto agree to resolve any and all 

disputes arising with respect to the terms and 

conditions of this Operating Agreement hereby by 

arbitration conducted by a single arbitrator selected 

from a slate of potential arbitrators residing in the 

Milwaukee, Madison or Chicago metropolitan areas, from 

a slate of five, proposed by JAMS. The party 

requesting arbitration shall strike the first name 

from the slate and the other party shall strike the 

next, alternating until a final individual remains, 

who shall serve as arbitrator and conduct an 

arbitration proceeding in accordance with the 

Arbitration Rules of JAMS. The arbitrator shall have 

the power to order temporary and permanent injunctive 

relief, on an expedited basis if deemed necessary. 

Any decision made by such an arbitrator within the 

scope of his or her authority shall be binding upon 

the parties. Unless agreed otherwise by the parties 

and arbitrator, the arbitration shall take place in 

Milwaukee County. The arbitration shall be governed 

by the laws of the State of Wisconsin, this Operating 

Agreement and the JAMS' Arbitration Rules[.]

(Emphasis added.) JAMS Rule 11(b) provides:

Jurisdictional and arbitrability disputes, including 

disputes over the formation, existence, validity, 

interpretation or scope of the agreement under which 

Arbitration is sought, and who are proper Parties to 

the Arbitration, shall be submitted to and ruled on by 

the Arbitrator. The Arbitrator has the authority to 

determine jurisdiction and arbitrability issues as a 

preliminary matter.

(Emphasis added.) Accordingly, the arbitration provision of the 

Operating Agreement evinces the parties' contractual agreement 

to have the arbitrator, rather than the circuit court, decide 

issues of arbitrability. The arbitration provision also 

requires "any and all disputes arising with respect to the terms 

and conditions of this Operating Agreement" be resolved in 

arbitration under JAMS rules.
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¶135 Application of these rules under Wisconsin law easily 

resolves this preliminary issue. The parties entered into a 

contract with an arbitration clause, which incorporates JAMS 

Arbitration Rules. Those Rules confer exclusive authority on 

the arbitrator to decide issues of arbitrability. Controlling 

law holds that by doing so, the arbitrability question must be 

decided by the arbitrator——not the circuit court. The dispute 

about whether the Redemption Agreement was formed challenges the 

existence and validity of the Operating Agreement. JAMS Rule 

11(b) controls and assigns authority to resolve this preliminary 

dispute to the arbitrator alone. Allegations that a partiallyexecuted Redemption Agreement superseded the Operating Agreement 

do not alter the analysis.

¶136 The majority expresses concern that "serious questions 

exist as to whether the Operating Agreement still controls the 

issue of arbitrability, whether the Redemption Agreement 

supersedes that agreement, and to what extent, if any, one codefendant, Dr. Pannu individually, ever agreed to arbitrate."6 I 

agree. But the parties' contract specifies that the arbitrator, 

not a court, must answer these questions. The contract could 

not be clearer: "arbitrability disputes, including disputes 

over the . . . existence, [and] validity . . . of the agreement

under which Arbitration is sought, and who are proper Parties to 

the Arbitration, shall be submitted to and ruled on by the 

Arbitrator." Great Lakes and Dr. Pannu challenge the existence 

 

6 Majority op., ¶54.
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and validity of the Operating Agreement in light of the 

Redemption Agreement. The parties agreed the arbitrator would 

decide this issue. Dr. Pannu disputes being a proper party to 

the arbitration. The parties agreed the arbitrator would decide 

this issue too. Contrary to the majority's minimization of the 

arbitrator's authority to decide arbitrability as a mere 

"presumption,"7 it is the parties' contract that requires 

arbitrability to be decided by the arbitrator. The court errs 

in interpreting Chapter 788 to require stripping the arbitrator 

of his contractual authority; nothing in Chapter 788 empowers 

the judiciary to override the parties' contracted method for 

resolving this precursory issue.

¶137 Contrary to the majority's misconstruction of the 

issue presented, this case is not about precluding parties from 

entering into subsequent agreements or altering the parties' 

preexisting choice of forum for dispute resolution. Certainly 

parties are free to change their minds and revoke, cancel, or 

otherwise invalidate the original agreement to arbitrate. But 

any decision to undo a contractual agreement to arbitrate must 

be mutual. If the parties did not dispute the formation of the 

Redemption Agreement or its applicability to each of them, the 

court may not be considering arbitration at all, given the 

unchallenged and fully executed Redemption Agreement with a 

merger clause. See Town Bank v. City Real Estate Dev., LLC, 

2010 WI 134, 330 Wis. 2d 340, 793 N.W.2d 476. A merger clause 

 

7 Majority op., ¶54.
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in a contract executed only by the party seeking to enforce that 

merger clause in order to evade a prior agreement to arbitrate 

does not have the same superseding effect when another party 

disputes its formation and application to all parties.8

¶138 This court has repeatedly protected parties' freedom 

to contract. Id., ¶33 (collecting cases). Our goal when 

interpreting contracts freely entered into by the parties "is to 

ascertain the true intentions of the parties as expressed by the 

contractual language." Id. (quoted source omitted). "[T]he 

best indication of the parties' intent is the language of the 

contract itself" and unless the contract is ambiguous, we stick 

to "the four corners of the contract, without consideration of 

extrinsic evidence." Id. (quoted source omitted). The only 

undisputed, freely-made contract before the court is the 

Operating Agreement and its plain language says the parties want 

"any and all" disputes about its existence or validity to be 

resolved by the arbitrator. I would honor the parties' contract 

by enforcing the arbitration provision in the Operating 

Agreement.

¶139 The majority opinion quotes "fundamental principles of 

freedom to contract" and acknowledges the "utmost liberty of 

contracting" and holds these rights "sacred,"9 but then proceeds 

 

8 Not only do Midwest and NEA challenge the formation of the 

Redemption Agreement, they also dispute the applicability of its 

merger clause to NEA based on language restricting its scope to 

Dr. Pannu and Midwest.

9 Majority op., ¶5, ¶39.
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to disregard the plain text of the parties' Operating Agreement 

and to ignore well-established arbitration principles supporting 

freedom of contract rights. The majority invents a new 

procedure for circuit courts to follow when a party to an 

existing contract requiring arbitration contends the fullyexecuted first contract is void due to the parties' negotiations 

over a second contract, which one party signed but the other 

party refused to sign. This unprecedented judicial intrusion 

directs courts to ignore the contractual conferral of authority 

on the arbitrator to decide arbitrability, and instead conduct a 

full-blown court trial over the existence and validity of the 

fully-executed contract containing the arbitration clause. As a 

result, the parties who previously decided to resolve disputes 

out-of-court will be subjected to a circuit court calendar 

delaying any hope of resolving the merits of the non-compete 

allegations until a factfinder resolves this preliminary dispute 

in a forum the parties previously rejected in favor of private 

arbitration.

¶140 In reaching this result, the majority erroneously 

distinguishes and "clarifies," but does not overrule, the only 

two Wisconsin cases addressing similar factual scenarios: 

Cirilli, 322 Wis. 2d 238, and Mortimore, 344 Wis. 2d 459.

¶141 Cirilli involved a dispute between insurance agents 

and their former employer, Country Insurance. 322 Wis. 2d 238, 

¶2. The Agents' written agreements with Country required 

binding arbitration for "any claim or controversy relating to or 

arising out of the relationship between the Agent and the 
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Companies." Id., ¶3. The Agents sued Country in circuit court 

claiming Country owed them termination commissions under the 

written agreements. Id., ¶2. Country filed a motion to compel 

arbitration of the Agents' claims. Id., ¶3. The Agents argued 

that a settlement agreement and release Country executed with 

different former agents making similar claims superseded the 

arbitration provision. Id., ¶5, ¶9. The Agents supported their 

argument with the decision of an arbitrator, in a prior case 

brought by different former agents, who determined the release 

voided the arbitration requirement. Id., ¶¶6-7. The circuit 

court agreed with the Agents' position and refused to order 

arbitration. Id., ¶8. The court of appeals reversed and 

ordered the matter sent to the arbitrator for determination. 

Id., ¶19. The court of appeals held the Agents' claims for 

termination commissions fell squarely within the agreement 

requiring arbitration and the fact that another arbitrator 

decided the release voided similarly situated agents' agreements 

with Country cannot be the basis for avoiding the Cirilli 

Agents' contractual language. Id., ¶¶15-18. The court of 

appeals ruled that by concluding the release controlled, the 

circuit court erroneously determined the merits of the Cirilli 

Agents' claims——a task assigned to the arbitrator, not the 

circuit court. Id.

¶142 Cirilli prohibits circuit courts from deciding the 

merits when the parties have agreed to arbitrate disputes, even 

when the answer is obvious and even when another arbitrator has 

already ruled on the merits of an identical claim involving 
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different claimants. Transferring a decision on the merits to 

the circuit court usurps the freedom of contract and the mutual 

decision two parties made to have disputes resolved by 

arbitration.

¶143 What constitutes the "merits" of a case can be unclear 

when one party argues a subsequent contract voided the 

obligations under the original contract. Typically, the merits 

will be the substantive allegation——here, Midwest's claim that 

Dr. Pannu violated his non-compete obligation goes to the 

"merits" of the dispute. However, the "merits" in this case 

also include a determination that a subsequent contract voids 

the existing contract because such a determination altogether 

eliminates the non-compete claim. By having the circuit court 

hold a trial whenever parties dispute the formation of a second 

contract (despite the existing contract's requirement that 

arbitrability be decided by the arbitrator), the majority 

disregards both the parties' contract and longstanding 

arbitration rules applied by both this court and the United 

States Supreme Court.10

 

10 "[A] court is not to rule on the potential merits of the 

underlying claims" even if the claims appear frivolous. AT&T 

Tech., Inc. v. Commc'ns. Workers of Am., 475 U.S. 643, 649-50 

(1986). Courts "have no business weighing the merits of the 

grievance, considering whether there is equity in a particular 

claim, or determining whether there is particular language in 

the written instrument which will support the claim." Id. Any 

doubts as to whether a claim should be arbitrated should be 

resolved in favor of arbitration. Id. at 650. "[A] challenge 

to the validity of the contract as a whole, and not specifically 

to the arbitration clause, must go to the arbitrator." Buckeye 

Check Cashing, Inc. v. Cardegna, 546 U.S. 440, 449 (2006).
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¶144 In attempting to distinguish Cirilli, the majority 

ignores the fact that the Cirilli Agents argued the release——

which did not contain an arbitration clause——superseded the 

underlying agreement between the parties, including its 

arbitration clause. This is the very issue presented in this 

case and the majority is simply wrong to state otherwise. 

Whether a subsequent agreement supersedes an earlier agreement 

containing an arbitration clause is a "question[] not properly 

before the court[.]" Cirilli, 322 Wis. 2d at 253, ¶18. In this 

case, whether the Redemption Agreement supersedes the Operating 

Agreement inquires into the existence and validity of the 

Operating Agreement, an issue the parties agreed the arbitrator 

must decide. The majority's interference with the arbitrator's 

exclusive province threatens the freedom to contract; it does 

not advance it.

¶145 In Mortimore, the court of appeals ordered arbitration 

in a factual scenario almost identical to Midwest's. Mortimore 

and his employer, Merge, had a written employment contract, 

which contained an arbitration clause for claims "'arising out 

of or relating to this Agreement.'" Mortimore, 344 Wis. 2d 459, 

¶3. The arbitration clause incorporated American Arbitration 

Association ("AAA") rules, and required any amendments to the 

contract be "in writing and signed" by Merge. Id. Merge's 

Compensation Committee and Mortimore were working on a new

contract for Mortimore and ostensibly reached an oral agreement 

on a contract that did not contain an arbitration clause. Id., 

¶7. The new contract was never signed, however, because Merge 
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learned Mortimore had interfered with Merge's audit, and 

Mortimore subsequently resigned at Merge's request. Id., ¶8. 

Mortimore sued Merge in court for breach of contract and Merge 

requested the circuit court send the matter to arbitration. 

Id., ¶¶9-10. The circuit court held an evidentiary hearing and 

concluded the oral contract superseded the contract requiring 

arbitration. Id., ¶10.

¶146 The court of appeals reversed, ruling that the 

question of whether the unsigned second contract superseded the 

arbitration-requiring contract was a question for the 

arbitrator. Id., ¶21. The court of appeals held: (1) deciding 

the oral agreement trumped the existing employment contract is a 

determination on the merits that courts "do not make," id., ¶19 

(citing AT&T Tech., 475 U.S. at 648-50); and (2) the parties 

unmistakably indicated they wanted the arbitrator to decide 

arbitrability as evidenced by the existing employment contract's 

adoption of AAA arbitration rules, including Rule 7(a): "[t]he 

arbitrator shall have the power to rule on his or her own 

jurisdiction, including any objection with respect to the 

existence, scope or validity of the arbitration agreement." 

Id., ¶20 (brackets in Mortimore).

¶147 Mortimore is on all fours with the facts in the 

current case. When parties have an existing contract with an 

arbitration clause indicating the parties want the arbitrator to 

decide arbitrability, whether a subsequent oral or partially 

executed agreement supersedes the existing contract is an issue 

the arbitrator must decide.
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¶148 By favoring judicial resolution of the preliminary 

issue of arbitrability due to the mere possibility that a second 

contract might be valid, the majority ignores both the language 

of the Operating Agreement as well as longstanding arbitration 

principles. Because the parties dispute whether a second 

contract superseded the first, the plain text of the first 

contract, requiring that arbitrability be decided by the 

arbitrator, governs. The parties, who agreed to resolve "any 

and all disputes" by arbitration, should get the benefit of 

their bargain. Instead of honoring the parties' contract to 

arbitrate, the majority sets it aside.

¶149 The majority hollowly recites the pivotal precept that 

"[f]reedom of contract is based on the idea that individuals 

should have the power to govern their own affairs without 

interference,"11 but nevertheless unseats the contractuallychosen arbitrator in favor of a judicially-imposed circuit court 

to resolve a dispute between parties who expressly rejected the 

court system as a forum for dispute resolution. Because I would 

enforce the parties' contractual expectations, I respectfully 

dissent.

 

11 Majority op., ¶39 (quoting Solowicz v. Forward Geneva 

Nat'l, LLC, 2010 WI 20, ¶34, 323 Wis. 2d 556, 780 N.W.2d 111).
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