Title: Universal Processing Services v. Circuit Court of Milwaukee County
Citation: N/A
Docket Number: 2016AP000923-W
State: Wisconsin
Issuer: Wisconsin Supreme Court
Date: March 29, 2017

2017 WI 26 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
 
CASE NO.: 
2016AP923-W 
COMPLETE TITLE: 
State of Wisconsin ex rel. Universal Processing 
Services of Wisconsin, LLC, 
          Petitioner, 
     v. 
Circuit Court of Milwaukee County and the 
Honorable John J. DiMotto, presiding, Samuel B. 
Hicks and Merchant Card Services, Inc. 
          Respondents. 
 
 
 
 
SUPERVISORY WRIT BEFORE THE SUPREME COURT 
 
 
OPINION FILED: 
March 29, 2017 
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
November 1, 2016 
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
Circuit 
 
COUNTY: 
Milwaukee 
 
JUDGE: 
John J. DiMotto 
 
 
 
JUSTICES: 
 
 
CONCURRED: 
CONCURRED/DISSENTED:       
ZEIGLER, J. concurs and dissents (Opinion 
filed). 
BRADLEY, R.G., J. joined by KELLY, J. concur 
and dissent (Opinion filed). 
 
DISSENTED: 
      
 
NOT PARTICIPATING: 
         
 
 
 
ATTORNEYS: 
 
 
For the petitioners, there was a brief by Ryan M. Billings, 
Robert L. Gegios, Melinda A. Bialzik and Kohner, Mann & Kailas,, 
S.C., Milwaukee, and oral argument by Ryan M. Billings. 
 
For the respondent the cause was argued by David C. Rice, 
assistant attorney general, with whom on the brief(s) was Brad 
D. Schimel, attorney general. 
 
 
 
2 
For the respondent, there was a brief by Joan M. Huffman, 
Paul R. Erickson and Gutglasas, Erickson, Bonville & Larson, 
S.C., Milwaukee, and oral argument by Joan M. Huffman. 
 
 
 
 
 
2017 WI 26
NOTICE 
This opinion is subject to further 
editing and modification.  The final 
version will appear in the bound 
volume of the official reports.   
No.   2016AP923-W 
(L.C. No. 
2014CV7986) 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
State of Wisconsin ex rel. Universal Processing 
Services of Wisconsin, LLC, 
 
          Petitioner, 
 
     v. 
 
Circuit Court of Milwaukee County and the 
Honorable John J. DiMotto, presiding, Samuel B. 
Hicks and Merchant Card Services, Inc., 
 
          Respondents. 
 
FILED 
 
MAR 29, 2017 
 
Diane M. Fremgen 
Clerk of Supreme Court 
 
 
 
 
PETITION 
for 
supervisory 
writ. 
 
Dismissed. 
 
Rights 
Declared.     
 
¶1 
SHIRLEY 
S. 
ABRAHAMSON, 
J.   Universal 
Processing 
Services 
of 
Wisconsin, 
LLC 
d/b/a 
Newtek, 
the 
plaintiff-
petitioner, petitions this court, pursuant to Wis. Stat. 
§ (Rule) 809.71 (2015-16),1 for a supervisory writ.  Newtek asks 
the court to exercise its constitutional authority to vacate an 
                                                 
1 All subsequent references to the Wisconsin Statutes are to 
the 2015-16 version unless otherwise indicated. 
No. 
2016AP923-W   
 
2 
 
order of the Circuit Court for Milwaukee County, John J. 
DiMotto, Judge, appointing retired Judge Michael Skwierawski as 
the referee and to vacate unlawful orders of the referee issued 
pursuant to the reference.  Samuel Hicks and his Idaho company, 
Merchant Card Services, are the defendants-respondents.  The 
Circuit Court for Milwaukee County and the Honorable John J. 
DiMotto, presiding, are also named as respondents.  The 
respondents oppose the petition.  
¶2 
Newtek 
argues 
that 
the 
circuit 
court's 
order 
appointing the referee expanded the role of referee into the 
role of de facto circuit court judge in violation of the 
Wisconsin Constitution and Wis. Stat. § (Rule) 805.06, a rule 
adopted by this court.2  Newtek does not challenge the 
constitutionality 
of 
Wis. 
Stat. 
§ (Rule) 805.06, 
governing 
references to a referee.3 
    
                                                 
2 In adopting Wis. Stat. § (Rule) 805.06 in 1975, the court 
adopted the pre-2003 version of Federal Rule of Civil Procedure 
53 with minor modifications.  The Wisconsin legislature amended 
the language of Wis. Stat. § 805.06(1), (3), (4), and (5) set 
forth in the supreme court order, making editorial, non-
substantive changes.  Laws of 1975, ch. 218, §§ 158-164.  
3 This court asked the parties to address in letter briefs 
whether the circuit court's Order of Reference comports with or 
contravenes the Wisconsin Constitution to the extent that the 
Order comports with Wis. Stat. § (Rule) 805.06.  In view of our 
holding, we need not, and do not, address the constitutionality 
of § (Rule) 805.06 or the extent to which a circuit court's 
Order of Reference must comply with or may differ from the 
provisions of § 805.06.  
No. 
2016AP923-W   
 
3 
 
¶3 
The dispute underlying this petition arises from a 
lawsuit initiated by Universal Processing Services of Wisconsin, 
LLC d/b/a Newtek (Newtek), a bankcard processing services 
company, 
the 
plaintiff-petitioner, 
against 
one 
of 
its 
independent sales agents, Samuel Hicks, and his Idaho company, 
Merchant Card Services (collectively, Hicks), the defendants-
respondents.  
¶4 
The following issues are presented: 
1. 
Is Newtek's petition for a supervisory writ properly 
before this court? 
2. 
Has Newtek waived or forfeited its objection to the 
Order of Reference, is it estopped from challenging 
the Order, or has it impliedly consented to the Order? 
3. 
Does the circuit court's Order of Reference contravene 
Article VII, Section 2 of the Wisconsin Constitution 
vesting judicial power of this state in a unified 
court system?   
4. 
Does the circuit court's Order of Reference, including 
the provision that the circuit court's review of the 
referee's "rulings" shall be based only on the 
referee's 
"erroneous 
exercise 
of 
discretion," 
contravene 
the 
Wisconsin 
Constitution 
and 
the 
Wisconsin statutes and rules regarding circuit court 
and appellate court authority and practice?     
5. 
Does the circuit court's Order of Reference contravene 
the parties' right to "obtain justice freely, and 
without being obliged to purchase it," guaranteed by 
No. 
2016AP923-W   
 
4 
 
Article I, Section 9 of the Wisconsin Constitution, or 
to due process of law, guaranteed by Article I, 
Section 1 of the Wisconsin Constitution, or Newtek's 
right to a jury trial, guaranteed by Article I, 
Section 5 of the Wisconsin Constitution? 
6. 
Should the orders of the referee to date be vacated 
and 
should 
the 
parties 
be 
allowed 
to 
request 
substitution of the judge on remand?  
¶5 
For the reasons set forth, we conclude as follows: 
1. 
Newtek's petition for a supervisory writ does not meet 
the 
requirements 
set 
forth 
in 
Wis. 
Stat. 
§ (Rule) 809.71.  The petition was not first filed in 
the court of appeals and Newtek has failed to show 
that it was impractical to file the petition in the 
court of appeals.  We do, however, exercise our 
constitutional superintending authority under Article 
VII, Section 3(2) of the Wisconsin Constitution to 
determine the validity of the Order of Reference.  A 
declaration of rights is an appropriate vehicle for an 
exercise of the superintending authority over circuit 
courts constitutionally granted to this court.4  See 
Part II, ¶¶36-50.  
2. 
Regardless of whether Newtek has waived or forfeited 
its right to challenge the Order of Reference, is 
                                                 
4 State ex rel. Memmel v. Mundy, 75 Wis. 2d 276, 281, 249 
N.W.2d 573 (1977). 
No. 
2016AP923-W   
 
5 
 
estopped from challenging the Order, or has impliedly 
consented to the reference, this court may resolve the 
issue of the validity of the Order of Reference under 
its constitutional superintending authority.  See Part 
III, ¶¶51-55. 
3. 
The Order of Reference impermissibly delegated to the 
referee judicial power constitutionally vested in 
Wisconsin's unified court system.  Accordingly, the 
Order 
does 
not 
survive 
Newtek's 
constitutional 
challenge.  See Part IV, ¶¶56-82. 
4. 
The circuit court's Order of Reference, including the 
provision that the circuit court's review of the 
referee's "rulings" shall be based only on the 
referee's 
"erroneous 
exercise 
of 
discretion," 
contravenes the constitution and statutes or rules 
regarding circuit court and appellate court authority 
and practice.  It infringes on the legislature's 
authority to define a circuit court's appellate 
jurisdiction.  See Part V, ¶¶83-88. 
5. 
We do not decide the instant case on the basis of 
Article I, Section 9 of the Wisconsin Constitution, 
the due process clause of Article I, Section 1 of the 
Wisconsin Constitution, or the right to jury trial of 
Article I, Section 5 of the Wisconsin Constitution, 
but we note that reference to a referee is the 
exception, not the rule; that there are constitutional 
limits on the powers of a referee; and that a 
No. 
2016AP923-W   
 
6 
 
reference can jeopardize a litigant's access to the 
justice system, due process, and right to a jury 
trial.  The Wisconsin Constitution requires the state 
to provide a judicial system for the resolution of 
disputes.  Access to state courts for conflict 
resolution is thus implicit in the state constitution.  
We express our concern that the use of referees 
increases the costs of litigation and may cause delay 
and, in certain cases, may deprive litigants of access 
to courts.  See Part VI, ¶¶89-103. 
6. 
To the extent the parties have agreed to abide by an 
order or ruling of the referee relating to discovery, 
that ruling or order shall stand.  To the extent 
either party has objected to an order or ruling of the 
referee relating to discovery, that ruling or order 
shall be vacated.  Any ruling or order of the referee 
on any dispositive motion is vacated.  Either party 
may request substitution of the judge under Wis. Stat. 
§§ 801.58(1) and (7).  See Part VII, ¶¶104-110.   
¶6 
We begin in Part I by setting forth the procedural 
facts relating to the appointment of the referee and the Order 
of Reference.  
I 
¶7 
On 
August 
27, 
2014, 
after 
nearly 
a 
decade 
of 
successful collaboration between Newtek and Hicks, Newtek 
terminated Hicks' contract.  On September 16, 2014, Newtek 
brought an action against Hicks in the Circuit Court for 
No. 
2016AP923-W   
 
7 
 
Milwaukee County, John J. DiMotto, Judge, alleging breach of 
contract, 
tortious 
interference 
with 
contract, 
breach 
of 
fiduciary duty, and misappropriation of confidential information 
and trade secrets.  Newtek demanded a jury trial. 
¶8 
The 
contract 
included 
restrictive 
covenants. 
The 
enforceability of these restrictive covenants is central to the 
underlying dispute.  Hicks filed an answer to the complaint, 
asserting affirmative defenses and counterclaims and seeking 
nearly $17 million in damages. 
¶9 
Because the contract provided for injunctive relief, 
Newtek promptly sought and received an ex parte temporary 
restraining order from a duty judge just a few days after filing 
the complaint.  The circuit court (Judge DiMotto) affirmed and 
reaffirmed the temporary restraining order.     
¶10 Over the course of the next several months, the 
parties began extensive discovery.  The parties periodically 
appeared before the circuit court for scheduling conferences and 
motion hearings.             
¶11 In early 2015, Newtek moved to amend the scheduling 
order to extend the deadlines for naming experts and providing 
expert reports.  Hicks opposed the extension and filed a motion 
to compel discovery.   
¶12 On February 17, 2015, the circuit court held a hearing 
on Newtek's motion to amend the scheduling order and decided to 
appoint a referee to the case.  At the hearing, Newtek described 
the case as a "classic big case" with numerous issues and 
No. 
2016AP923-W   
 
8 
 
production of a substantial number of documents in discovery 
(50,000 thus far):   
[W]hen we appeared before you in November [everyone] 
was overly optimistic in terms of what could be 
accomplished. In particular, overly optimistic in 
where we slotted the expert disclosures in relation to 
what . . . this litigation has spawned by way of 
discovery.  We're approaching just on our side nearly 
40,000 pages of production, about which the other side 
is 
still 
complaining. 
 
The 
other 
side 
has 
produced . . . in the order of 10,000 [pages], about 
which we're complaining. . . .  
We have the classic big case with lots of issues now. 
We have more than one case in the sense that we have 
filed a complaint with numerous causes of action but 
there is a counter complaint.  The counterclaims have 
been filed by the other side, and discovery is 
occurring 
with 
regard 
to 
both 
of 
those 
pleadings. . . . 
And so we are doing our best to produce without coming 
to the court . . . . And it has been a production that 
has gotten to the point of something like a thousand 
pages . . . that we are producing per day.  That's 
what the average is since this began. 
¶13 The 
circuit 
court 
granted 
Newtek's 
request 
for 
extension in part and also gave Hicks an extension.  The circuit 
court 
expressed 
frustration 
with 
the 
already 
cumbersome 
discovery, especially the attorneys' conduct, stating:  
Well you know, the one thing that I put a real high 
value on are [sic] attorneys being reasonable.  Quite 
frankly, it seems to me that both sides here are not 
being——at least they're not being reasonable . . . . 
¶14 Explaining that the circuit court had "some 450 cases" 
on its docket, the circuit court stated that it was "not going 
to expend a lot of time dealing with [the parties'] discovery 
bickering."  Accordingly, the circuit court appointed retired 
No. 
2016AP923-W   
 
9 
 
Judge Michael Skwierawski as the referee under Wis. Stat. 
§ (Rule) 805.06, explaining the appointment as follows:  
I am going to be appointing . . . retired Judge 
Michael Skwierawski as the Special Master in this case 
under 805.06. . . . [Y]ou'll have to deal with him 
with respect to discovery disputes, etcetera, because 
I'm not going to waste precious court time that I can 
give to other cases to be your personal slave to your 
discovery disputes. So I just want you to know that. 
So the more reasonable you are with each other, the 
less likely you're going to need to pay the fees of 
retired Judge Michael Skwierawski. And he doesn't come 
cheap when it comes to being a Special Master. So I 
encourage you to be cooperative in your discovery, 
help each other out, get this case to mediation sooner 
than later.  (Emphasis added.) 
¶15 Although the circuit court uses the phrase "Special 
Master," this opinion uses the word "referee," adhering to Wis. 
Stat. § (Rule) 805.06, which uses the term "referee."  The term 
"master" had such a pejorative connotation in 1848 at the time 
of statehood, as we shall explain later,5 that the word "referee" 
has been used in Wisconsin.6    
¶16 The circuit court explained that it would call retired 
Judge Michael Skwierawski to ask him if he would accept the 
appointment.  The circuit court also explained that the referee 
would draft the Order Appointing Special Master/Referee (Order 
of Reference or Order)7 because the referee has a list of things 
                                                 
5 See ¶65, infra. 
6 Federal Rule of Civil Procedure 53 uses the word "master."   
7 The court order appointing a referee and describing the 
referee's powers is called a "reference" or an "order of 
reference."  Ehlinger v. Hauser, 2010 WI 54, 
¶77, 325 
Wis. 2d 287, 785 N.W.2d 328; Wis. Stat. § (Rule) 805.06(5)(a).    
No. 
2016AP923-W   
 
10 
 
that he requires.  Neither party objected to the circuit court's 
decision to appoint the referee.   
¶17 The circuit court directed Newtek to draft a proposed 
order memorializing the outcome of the February 17 hearing, 
including the referee's appointment.  Newtek's counsel contacted 
the referee on February 18 to confirm his availability before 
drafting this order.  The referee said he was available and that 
he had already submitted a proposed Order of Reference to the 
circuit court; the referee directed counsel from each side to 
submit any objections to the proposed order.  
¶18 Newtek told the referee that it was reviewing the 
Order of Reference and would submit objections, if any, as soon 
as possible.  Less than a day after counsel received the Order, 
the circuit court informed the parties that it had entered the 
Order.  Thus, neither side was able to submit any objections 
before the Order of Reference was signed.   
¶19 The 
Order 
of 
Reference 
pertained 
to 
more 
than 
discovery issues.  In addition to authority to manage discovery, 
the Order granted authority over nearly all aspects of the case 
and provided for limited review by the circuit court.  The 
reference provided, inter alia: 
• All motions, whether discovery or dispositive, were to be 
heard and decided initially by the referee.   
• The referee's written rulings would be adopted and 
entered as the rulings of the court, automatically and 
without hearing, unless a party filed an exception within 
five days.   
No. 
2016AP923-W   
 
11 
 
• The referee could certify matters to the circuit court, 
and the circuit court could refuse to decide these 
matters.  
• The circuit court retained the power to modify or set 
aside a referee's ruling, but the circuit court could 
only do so if the ruling were based on an erroneous 
exercise of discretion.   
• The parties were to compensate the referee at $450 per 
hour plus reasonable and necessary expenses.  The parties 
were to divide the cost of the referee equally.  (The 
total cost of the referee thus far has been about 
$45,000.)     
¶20 Three relevant provisions of the Order of Reference 
are as follows (emphasis added):  
4. 
The [referee] shall have the full authority of 
the 
Court 
in 
coordinating 
and 
establishing 
all 
pretrial procedures.  The [referee] shall also have 
the full authority of the Court to hear and decide, 
subject to Court review as set forth below, any other 
matters assigned to him by the Court.  All motions 
filed, 
whether 
discovery 
or 
dispositive, 
shall 
initially be heard and decided by the [Referee], 
subject to review processes available as described 
below.8  
7. 
If the [referee] is of the opinion that a 
specific issue presented by the parties is of such 
fundamental importance to the progress or outcome of 
the case that effective case management would not be 
furthered by having the [referee] render a decision in 
                                                 
8 Requiring all motions to be filed with the referee was not 
part of the referee's usual form order; this provision was added 
at the circuit court's request.   
No. 
2016AP923-W   
 
12 
 
the 
first 
instance, 
the 
[Referee] 
may 
at 
his 
discretion certify that issue to the Court.  As the 
final arbiter of case management, the Court may, but 
need not, accept the certification. . . .  
8. 
Exceptions to any decisions made by the [referee] 
may be taken to this Court and must be filed with the 
Court within five (5) business days of the issuance of 
the decision.  Review by the Court shall be based on 
the materials and record before the [referee].  No 
additional filings will be permitted unless good cause 
and exceptional circumstances are demonstrated by the 
requesting Party.  The Court has full authority to 
modify or set aside the ruling of the [referee] but 
will do so only if the ruling is based on an erroneous 
exercise of discretion.  Unless an exception is taken, 
any ruling by the [referee] shall automatically and 
without hearing be adopted and entered as a ruling of 
the Court within five (5) business days of submission 
by the [referee] to the Court and parties.  All 
decisions made by the [referee] shall be appealable 
after the final disposition of this case, to the full 
extent as if made by this Court.  A party need not 
take exception to a decision by the [referee] in order 
to preserve the issue for appeal, either on an 
interlocutory basis or as an appeal of a final order. 
¶21 A copy of the complete order appointing the referee is 
attached as Attachment A. 
¶22 Shortly after the referee's appointment, Hicks moved 
to vacate the temporary injunction previously issued by the 
circuit court.  As counsel for both parties and the referee were 
e-mailing back and forth about this motion and scheduling 
issues, the circuit court (copied on the e-mail chain by the 
referee) told the referee to handle this motion and any others 
that would arise. 
¶23  The circuit court explained to the referee: "I 
appointed you to serve as [referee] because I anticipated 
extensive motion practice and discovery issues/disputes that 
No. 
2016AP923-W   
 
13 
 
would need [to be] addressed more quickly than I could do with 
my 400+ case calendar.  I would like you to resolve these, and 
all, pretrial motions/discovery issues."   
¶24 The 
parties 
briefed 
the 
issue 
of 
vacating 
the 
temporary injunction; the referee heard oral argument and issued 
a written order that granted Hicks' request to vacate the 
temporary injunction.  Newtek subsequently filed an exception to 
this decision with the circuit court; the circuit court affirmed 
the referee's decision.   
¶25 After vacating the temporary injunction, the referee 
ruled on more than 15 discovery motions and a few motions for 
sanctions (related to discovery conduct) over the course of 
several months.  Newtek objected to several of these orders, all 
of which the circuit court affirmed without a hearing. 
¶26 In 2015, the referee was asked to decide multiple 
dispositive motions.  In July 2015, Hicks filed two motions for 
summary judgment; in October 2015, Newtek filed its own motion 
for summary judgment.  These motions for summary judgment 
primarily 
involved 
the 
enforceability 
of 
the 
restrictive 
covenants and claims or discovery issues related thereto.  Hicks 
also sought a motion in limine barring Newtek from introducing 
evidence at trial relating to the restrictive covenants.   
¶27 Both 
parties 
submitted 
briefs 
and 
evidentiary 
materials on these motions and participated in a hearing before 
the referee.  The referee recommended partially granting each 
side's motion for summary judgment and granting Hicks' motion in 
limine.  The referee recommended, inter alia, that summary 
No. 
2016AP923-W   
 
14 
 
judgment be granted to Newtek on certain of Hicks' counterclaims 
and found that some restrictive covenants upon which Newtek 
relied were unreasonable, invalid, and unenforceable under Wis. 
Stat. § 103.465.  
¶28 Newtek filed exceptions to these rulings, requesting 
leave to submit additional briefing or evidence to the circuit 
court regarding the referee's decisions.  Newtek also asked the 
circuit court to review the referee's orders de novo (rather 
than under the Order's prescribed "erroneous exercise of 
discretion" standard of review) because the "magnitude of errors 
that have plagued this case, if uncorrected, will necessitate an 
interlocutory appeal."  
¶29 Newtek also declared that "[a]s the parties were never 
afforded an opportunity to object to the scope and terms of the 
[referee's] appointment, Newtek will also seek to brief the 
issue of the appointment of the [referee]."   
¶30 The circuit court agreed to review the referee's 
recommendations on the dispositive issues de novo.  In regard to 
Newtek's 
other 
requests——to 
brief 
the 
dispositive 
issues 
further, submit additional evidence, and brief the issue of the 
appointment of the referee——the record is silent.  Newtek claims 
that the circuit court denied these requests at an off-the-
record status conference in chambers on January 12, 2016.    
¶31 On January 21, 2016, the circuit court issued a 
lengthy order on the parties' cross-motions for summary judgment 
and on the exceptions taken to the referee's recommendations.  
The 
circuit 
court 
agreed 
with 
most 
of 
the 
referee's 
No. 
2016AP923-W   
 
15 
 
recommendations, granting partial summary judgment to each party 
and limiting the evidence that Newtek could present at trial to 
prove its claims.   
¶32 Although the circuit court's opinion states that it is 
based on a de novo review of the record and the parties' 
submissions, Newtek contends that the circuit court did not 
actually conduct a de novo review.9  
¶33 On February 4, 2016, Newtek filed a petition with the 
court of appeals for leave to appeal from the circuit court's 
order granting partial summary judgment and limiting evidence at 
trial.   
¶34 In its February 2016 petition for leave to appeal, 
Newtek detailed problems relating to the referee's appointment, 
role, and lack of control by the circuit court, but it did not 
request 
the 
court 
of 
appeals 
to 
vacate 
the 
referee's 
appointment, to consider any constitutional issues, or to 
determine the referee's authority to find facts, make legal 
conclusions, and issue orders.  Newtek's major argument focused 
on substantive legal issues; Newtek argued that the circuit 
court and the referee ignored the record and misstated the law.   
¶35 On April 6, 2016, the court of appeals denied the 
petition for leave to appeal on a usually stated ground that the 
"petition fails to satisfy the criteria for permissive appeal.  
See Wis. Stat. § 808.03(2) (2013-14) . . . ."  Newtek did not 
                                                 
9 Brief of Petitioner at 24. 
No. 
2016AP923-W   
 
16 
 
petition this court for review of the court of appeals' order 
denying the petition for leave to appeal.  See Wis. Stat. 
§ (Rule) 809.62.  Nor did Newtek petition the court of appeals 
for a supervisory writ under § (Rule) 809.51 to vacate the 
circuit court's order appointing the referee.  Instead, Newtek 
sought a supervisory writ in this court on May 6, 2016.   
II 
¶36 The 
first 
issue 
presented 
is 
whether 
Newtek's  
petition for a supervisory writ asking the court to vacate a 
circuit court order appointing retired Judge Michael Skwierawski 
as the referee is properly before this court.  We conclude that 
the petition is not properly before this court, but we exercise 
our superintending authority to vacate the Order of Reference. 
¶37 The 
Wisconsin 
Constitution 
grants 
three 
separate 
powers to this court:  appellate and original jurisdiction; the 
power to issue all writs necessary in aid of its jurisdiction; 
and superintending authority over all courts.  Wis. Const. art. 
VII, § 3.10   
                                                 
10 State ex rel. Reynolds v. County Court, 11 Wis. 2d 560, 
564, 105 N.W.2d 876 (1960). 
The original Article VII, Section 3 of the 1848 Wisconsin 
Constitution provides as follows:  
The supreme court, except in cases otherwise provided 
in 
this 
constitution, 
shall 
have 
appellate 
jurisdiction only, which shall be coextensive with the 
state; but in no case removed to the supreme court 
shall a trial by jury be allowed.  The supreme court 
shall have a general superintending control over all 
inferior courts; it shall have power to issue writs of 
habeas corpus, mandamus, injunction, quo warranto, 
(continued) 
No. 
2016AP923-W   
 
17 
 
¶38 We begin with the court's power to issue supervisory 
writs.  Wisconsin Stat. §§ (Rules) 809.71 and 809.51 govern writ 
practice.   
¶39 Wisconsin Stat. § (Rule) 809.71 authorizes a person to 
request 
the 
supreme 
court 
to 
exercise 
its 
supervisory 
jurisdiction over a court and the judge presiding therein by 
filing a petition in accordance with § (Rule) 809.51.  Section 
(Rule) 809.51 
governs 
the 
contents 
of 
the 
petition 
and 
supporting memorandum and provides that the court may grant or 
deny the petition or order such additional proceedings as it 
considers appropriate.  According to § (Rule) 809.71, a person 
seeking a writ in the supreme court shall first file a petition 
                                                                                                                                                             
certiorari, and other original and remedial writs, and 
to hear and determine the same. 
In April 1977, Article VII, Section 3 of the Wisconsin 
Constitution was revised to read as follows: 
(1) The supreme court shall have superintending and 
administrative authority over all courts. 
(2) The supreme court has appellate jurisdiction over 
all 
courts 
and 
may 
hear 
original 
actions 
and 
proceedings. The supreme court may issue all writs 
necessary in aid of its jurisdiction. 
(3) The supreme court may review judgments and orders 
of the court of appeals, may remove cases from the 
court of appeals and may accept cases on certification 
by the court of appeals. 
No. 
2016AP923-W   
 
18 
 
for a supervisory writ in the court of appeals unless it is 
impractical to do so.11   
¶40 Wisconsin Stat. § (Rule) 809.71, governing supervisory 
writs in this court, provides as follows:  
809.71 Rule (Supervisory writ).  A person may request 
the 
supreme 
court 
to 
exercise 
its 
supervisory 
jurisdiction over a court and the judge presiding 
therein or other person or body by filing a petition 
in accordance with s. 809.51.  A person seeking a 
supervisory writ from the supreme court shall first 
file a petition for a supervisory writ in the court of 
appeals under s. 809.51 unless it is impractical to 
seek the writ in the court of appeals.  A petition in 
the supreme court shall show why it was impractical to 
seek the writ in the court of appeals or, if a 
petition had been filed in the court of appeals, the 
disposition made and reasons given by the court of 
appeals. 
¶41 Newtek did not first file a petition for a supervisory 
writ in the court of appeals as required by Wis. Stat. 
§ (Rule) 809.71.  Newtek claims that it was impractical to seek 
the writ in the court of appeals because the court of appeals 
denied its petition for leave to file an appeal, and that its 
petition for leave to file an appeal sought the assistance of 
the court of appeals for reasons similar to those offered in its 
petition in this court for a supervisory writ. 
                                                 
11 See also Judicial Council Committee's Note, 1981, Wis. 
Stat. § (Rule) 809.71 ("The supreme court will not exercise its 
supervisory jurisdiction where there is an adequate alternative 
remedy.  Unless the court of appeals is itself the object of the 
supervisory writ, usually there is an adequate alternative 
remedy of applying to the court of appeals under Rule 809.51 for 
the supervisory writ."). 
No. 
2016AP923-W   
 
19 
 
¶42 Newtek's interlocutory appeal to the court of appeals 
primarily focused on the substantive merits of the summary 
judgment 
and 
on 
limiting 
evidence 
at 
trial, 
and 
only 
tangentially raised objections to the Order of Reference.    The 
court of appeals gave no specific explanation other than its 
usually stated ground that the "petition fails to satisfy the 
criteria for permissive appeal.  See Wis. Stat. § 808.03(2) 
(2013-14) . . . ."  We therefore do not know why the court of 
appeals denied the petition for leave to appeal. 
 
¶43 The grounds for the court of appeals to grant a 
petition for leave to appeal12 are not necessarily the same as 
the grounds for granting a supervisory writ.13  On this record, 
                                                 
12 The grounds for the court of appeals to grant leave to 
appeal are set forth in Wis. Stat. § 808.03(2) as follows: 
(2) APPEALS BY PERMISSION.  A judgment or order not 
appealable as a matter of right under sub. (1) may be 
appealed to the court of appeals in advance of a final 
judgment or order upon leave granted by the court if 
it determines that an appeal will: 
(a) 
Materially 
advance 
the 
termination 
of 
the 
litigation or clarify further proceedings in the 
litigation; 
(b) 
Protect 
the 
petitioner 
from 
substantial 
or 
irreparable injury; or 
(c) Clarify an issue of general importance in the 
administration of justice. 
13 A party seeking a supervisory writ must demonstrate that: 
1. An appeal is an inadequate remedy; 
2. Grave hardship or irreparable harm will result; 
(continued) 
No. 
2016AP923-W   
 
20 
 
we cannot determine the ground on which the court of appeals 
denied Newtek's petition for leave to appeal or whether it was 
impractical for Newtek to seek a supervisory writ in the court 
of appeals that focused on the validity of the Order of 
Reference.   
 
¶44 We 
decline 
to 
extend 
our 
supervisory 
writ 
jurisprudence and cast doubt on the continued vitality of the  
"impracticality" requirement of Wis. Stat. § (Rule) 809.71.  We 
therefore decline to hold that Newtek has shown that it was 
impractical for it to seek a supervisory writ in the court of 
appeals and that Newtek's petition for a supervisory writ  
complies with Wis. Stat. § (Rule) 809.71.   
¶45 In the alternative, Newtek asks that we use our 
constitutional power of "superintending authority" over all 
Wisconsin courts, Wis. Const. art. VII, § 3(1), to review the 
validity of the Order of Reference.   
¶46 We can and should decide the issue of the validity of 
the Order of Reference using our constitutional superintending 
authority under the circumstances of this case.  The validity of 
the Order of Reference is an important issue for Wisconsin 
courts and the public.  
                                                                                                                                                             
3. The duty of the trial court is plain and it must 
have acted or intended to act in violation of that 
duty; and 
4. The 
request 
for 
relief 
is 
made 
promptly 
and 
speedily. 
No. 
2016AP923-W   
 
21 
 
¶47 The 
superintending 
authority 
provision 
of 
the 
Wisconsin Constitution endows this court "with a separate and 
independent jurisdiction, which enables and requires it in a 
proper case to control the course of ordinary litigation 
in . . . inferior courts . . . ."14  The nature and scope of the 
superintending authority of this court has been before this 
court numerous times since at least 1853.15  The scope of this 
authority is "as broad and as flexible as necessary to insure 
the due administration of justice in the courts of this state."16  
"In exercising this power of superintending control, this court 
is not restricted to the use of common-law writs and is limited 
                                                 
See State ex rel. Three Unnamed Petitioners v. Peterson, 2015 WI 
103, ¶26, 365 Wis. 2d 351, 875 N.W.2d 49; State ex rel. Two 
Unnamed Petitioners v. Peterson, 2015 WI 85, ¶¶100-132, 363 
Wis. 2d 1, 866 N.W.2d 165. 
14 State ex rel. Fourth Nat'l Bank of Philadelphia v. 
Johnson, 103 Wis. 591, 613, 79 N.W. 1081 (1899)). 
15 See, e.g., Attorney General v. Blossom, 1 Wis. 317 
(1853). 
16 Madison Teachers, Inc. v. Walker, 2013 WI 91, ¶16, 351 
Wis. 2d 237, 
839 
N.W.2d 388 
(quoting 
In 
re 
Kading, 
70 
Wis. 2d 508, 520, 235 N.W.2d 409 (1975)). 
No. 
2016AP923-W   
 
22 
 
only by the necessities of justice."17  But the superintending 
authority of the court is not to be used lightly.18 
¶48 The question of exercising the constitutional grant of 
superintending authority is one of judicial policy rather than 
one relating to the power of this court.  To convince this court 
to exercise this constitutional grant of power, a party must 
establish that an appeal from a final judgment is inadequate and 
that grave hardship will follow a refusal to exercise the 
power.19       
¶49 Whether an erroneously ordered compulsory reference 
creates such a hardship is judged on the facts of the case.  The 
following 
circumstances 
compel 
the 
exercise 
of 
our 
superintending authority over circuit courts in the instant 
case:  
                                                 
17 State ex rel. Reynolds v. County Court, 11 Wis. 2d 560, 
565, 105 N.W.2d 876 (1960).  See also State v. Ernst, 2005 WI 
107, ¶19, 283 Wis. 2d 300, 699 N.W.2d 92; Arneson v. Jezwinski, 
206 Wis. 2d 217, 225, 556 N.W.2d 721 (1996). 
18 See State ex rel. Hustisford Light, Power, & Mfg. Co v. 
Grimm, 208 Wis. 366, 370, 371, 243 N.W. 763 (1932) (citing State 
ex rel. Tewalt v. Pollard, 112 Wis. 232, 87 N.W. 1107 (1901); 
State ex rel. City of Milwaukee v. Ludwig, 106 Wis. 226, 82 N.W. 
158 (1900); State ex rel. Fourth Nat'l Bank of Philadelphia v. 
Johnson, 105 Wis. 164, 83 N.W. 320 (1899); State ex rel. Meggett 
v. O'Neill, 104 Wis. 227, 80 N.W. 447 (1899); State ex rel. v. 
Nat'l Bank of Philadelphia v. Johnson, 103 Wis. 591, 612, 79 
N.W. 1081 (1899)). 
19 Hustisford, 208 Wis. at 370.   
No. 
2016AP923-W   
 
23 
 
• The Order of Reference broadly delegates to the 
referee the authority to decide all motions, whether 
discovery or dispositive.   
• The Order of Reference is apparently used with some 
frequency in Milwaukee County, and the appointment of 
referees may become an increasingly common practice in 
the circuit courts. 
• This court has not recently reviewed the permissible 
scope of references under Wisconsin law.   
• The case presents significant state constitutional 
issues having statewide importance relating to core 
functions of the circuit courts and access to the 
courts.   
• If this court does not review the validity of the 
Order of Reference at this time, the parties will 
endure great hardship; they will have to submit to a 
long and expensive reference and then trial before 
being afforded the opportunity to seek relief on 
appeal.  And after trial and appeal if the reference 
is held invalid, the parties will again be at the 
discovery stage.20     
                                                 
20 Hustisford, 
208 
Wis. 
at 
371-72 
(holding 
that 
a 
postjudgment appeal regarding a compulsory reference justifies 
this court's exercise of supervisory power and issuance of a 
writ of mandamus); Killingstad v. Meigs, 147 Wis. 511, 517, 133 
N.W. 632 (1911) (holding that an unauthorized compulsory 
reference is a material and reversible error). 
No. 
2016AP923-W   
 
24 
 
¶50 We therefore use our constitutional superintending 
authority to declare the rights of the parties in the instant 
case.    
III 
¶51 Hicks argues that Newtek has sat on its rights too 
long by participating in proceedings with the referee for about 
a year without objection to the Order of Reference and then 
objecting only after it received an adverse summary judgment 
ruling.  The argument is that Newtek has waived or forfeited its 
right to challenge the Order, is estopped from challenging the 
Order, or has impliedly consented to the Order.21  We now turn to 
whether this court should address the validity of the Order of 
Reference 
regardless 
of 
whether 
Newtek 
has 
not 
promptly 
challenged the Order.   
¶52 Hicks raises an important point:  Litigants should 
object to an Order of Reference promptly.  Otherwise, litigation 
will become more protracted and costly.  "If a party wishes to 
contest the reference, it should move the court to revoke the 
reference."  
Ehlinger v. Hauser, 2010 WI 54, 
¶77, 325 
Wis. 2d 287, 785 N.W.2d 328.  
¶53 Newtek offers reasons for its delay in objecting to 
the reference.  We need not decide, however, whether Newtek was 
justified in failing to object more promptly.  Rules of 
                                                 
21 For 
a 
discussion 
of 
the 
concepts 
of 
waiver 
and 
forfeiture, 
see 
State 
v. 
Ndina, 
2009 
WI 
21, 
¶29, 
315 
Wis. 2d 653, 761 N.W.2d 612. 
No. 
2016AP923-W   
 
25 
 
forfeiture and waiver are rules of judicial administration, and 
thus, a reviewing court may disregard a waiver or forfeiture and 
address the merits of an unpreserved issue in an appropriate 
case.22 
¶54 Hicks urges that Newtek's participation in proceedings 
before the referee and Newtek's failure to seek relief from the 
Order 
of 
Reference 
promptly 
were 
tantamount 
to 
Newtek's 
impliedly consenting to the reference and estop Newtek.  Newtek 
responds that it is not estopped, that affirmative consent——
which it never gave——is necessary to bind a party to non-
judicial dispute resolution (such as arbitration), and that 
implied consent cannot provide a referee with authority the law 
prohibits a referee from having, citing AT&T Technologies, Inc. 
v. Communications Workers of Am., 475 U.S. 643, 648 (1986) 
(explaining that arbitration requires affirmative agreement); 
and Jovine v. FHP, Inc., 64 Cal. App. 4th 1506, 1531, 76 Cal. 
Rptr. 2d 322 (1998) (holding that a party must explicitly 
consent to a referee's making substantive rulings).  See also In 
re L.J., 157 Cal. Rptr. 3d 197, 207 (Cal. Ct. App. 2013) 
(explaining that unauthorized referee orders are void and 
consent is irrelevant).  
¶55 When the constitutional limitations of Article VII, 
Section 2 of the Wisconsin Constitution on reference are at 
                                                 
22 See, e.g., State v. McKellips, 2016 WI 51, ¶47, 369 
Wis. 2d 437, 881 N.W.2d 258; Vill. of Trempealeau v. Mikrut, 
2004 WI 79, ¶17, 273 Wis. 2d 76, 681 N.W.2d 190; Bradley v. 
State, 36 Wis. 2d 345, 359–359a, 153 N.W.2d 38 (1967). 
No. 
2016AP923-W   
 
26 
 
issue, notions of waiver, forfeiture, estoppel, and consent 
should not be dispositive.  The constitutional limitations on 
reference serve institutional and public interests that should 
be protected.23  Because the issue presented is significant to 
the functioning of the Wisconsin court system and to the public, 
and because an important constitutional issue is presented, we 
do not treat Newtek's failure to object more promptly as a 
waiver, forfeiture, or estoppel to object to the validity of the 
reference, or as implied consent to the reference.  Rather, we 
address 
the 
merits 
of 
the 
issues 
presented 
under 
our 
constitutional superintending authority.   
IV 
¶56 We turn now to decide whether the circuit court's 
Order of Reference contravenes Article VII, Section 2 of the 
Wisconsin Constitution, which vests the "judicial power" of this 
state in a unified court system as follows:     
Art. VII. Sec. 2. The judicial power of this state 
shall be vested in a unified court system consisting 
of one supreme court, a court of appeals, a circuit 
court, such trial courts of general uniform statewide 
jurisdiction as the legislature may create by law, and 
a municipal court if authorized by the legislature 
under section 14.   
¶57 The phrase "judicial power" is not defined in the 
Wisconsin Constitution.  Nor does the Wisconsin Constitution 
vest "judicial power" in a referee.  Newtek contends that the 
                                                 
23 Cf. Commodities Futures Trading Comm'n v. Schor, 478 U.S. 
833, 848-49 (1986) (discussing Article III of the United States 
Constitution). 
No. 
2016AP923-W   
 
27 
 
Order of Reference in the instant case enables the referee to 
impermissibly wield constitutional "judicial power." 
¶58 Constitutional judicial power was discussed in State 
v. Williams, 2012 WI 59, 341 Wis. 2d 191, 814 N.W.2d 460.  In 
Williams, we addressed whether a circuit court commissioner's 
issuance of a search warrant was an exercise of the judicial 
power vested in the unified court system by Article VII, Section 
2 
of 
the 
Wisconsin 
Constitution. 
 
We 
described 
the 
constitutional "judicial power" as the "ultimate adjudicative 
authority 
of 
courts 
to 
finally 
decide 
rights 
and 
responsibilities 
as 
between 
individuals." 
 
Williams, 
341 
Wis. 2d 191, ¶36.  Recognizing, however, that the Wisconsin 
Constitution 
contemplated 
unelected 
officers 
(like 
court 
commissioners) exercising certain, limited judicial functions, 
we concluded that a court commissioner's issuing a search 
warrant was not an impermissible exercise of constitutional 
"judicial power."   
¶59 No party in the instant case questions the power of a 
circuit court to appoint a referee.24  Used properly, a circuit 
court's power to appoint and assign functions to a referee is 
not unconstitutional and allows circuit courts to provide more 
efficient dispute resolution to litigants.     
                                                 
24 Although there is no similar Wisconsin precedent, the 
United States Supreme Court has declared that federal courts 
have an inherent authority to appoint masters "to aid judges in 
the performance of specific judicial duties, as they may arise 
in the progress of a cause."  Ex parte Peterson, 253 U.S. 300, 
312 (1920).   
No. 
2016AP923-W   
 
28 
 
¶60 Indeed, the power of circuit courts to appoint 
referees to assist courts with limited functions can be traced 
to Wisconsin's territorial days.  This historical role of 
referees informs our decision. 
¶61 Wisconsin's territorial statutes recognized the use of 
special masters in any cause requiring the examination of a 
"long account."25  "Actions at law which involved the examination 
of a long account might be compulsorily referred ever since the 
constitution was adopted, and for a long time before."26      
¶62 After adoption of the Wisconsin Constitution, statutes 
authorized the appointment of referees to assist trial courts 
with matters of long account and limited pretrial functions.  
Actions not within the governing statutes could not be referred 
to a referee.27 
                                                 
25 See Bd. of Supervisors of Dane Cty. v. Dunning, 20 Wis. 
221 (*210), 228 (*216) (1866) ("In Wisconsin, a compulsory 
reference was provided for in actions at law requiring the 
examination of such accounts, as early as 1839.  Stat. 1839, p. 
209, § 84.").    
The Supreme Court of the Territory of Wisconsin declared 
that a reference to a panel of referees to examine a long 
account did not violate the United States Constitution's 
guarantee of trial by jury.  See Rooker v. Norton, 1 Pin. 195 
(1842).   
26 Killingstad v. Meigs, 147 Wis. 511, 517, 133 N.W.2d 632 
(1911). 
27 Brown v. Runals, 14 Wis. 755, 761 (1861); Killingstad, 
147 Wis. at 514-15. 
No. 
2016AP923-W   
 
29 
 
¶63 Shortly after adoption of the Wisconsin Constitution, 
this 
court 
declared 
that 
limited 
use 
of 
referees 
was 
constitutional because their use dated to pre-constitution 
days.28  The state constitution "did not take away this right of 
reference, but only provided that the right of trial by jury 
should remain as it was before . . . ."29 
¶64 Although these early cases recognized that a reference 
was not a per se violation of the Wisconsin Constitution and 
that a referee had only the functions conferred by the order of 
reference,30 the cases also recognized that appointment of a 
referee is for the exceptional case,31 and that the power to 
refer was not limitless.  For example, a referee's report was 
                                                 
28 Dunning, 20 Wis. at 228 (*216).  
29 Dunning, 20 Wis. at 228 (*216); Stilwell v. Kellogg, 14 
Wis. 499, (1861).  
30 Best v. Pike, 93 Wis. 408, 414, 67 N.W. 697 (1896); Knips 
v. Stefan, 50 Wis. 286, 6 N.W. 877, 880 (1880); Stone v. 
Merrill, 43 Wis. 72 (1877). 
31 Knips v. Stephan, 50 Wis. 286, 290, 6 N.W. 877 (1880) 
("The right to have the issues determined by a referee and the 
court, 
against 
the 
consent 
of 
either 
party, 
is 
the 
exception . . . .").   
See also Ehlinger v. Hauser, 2010 WI 54, ¶89, 325 
Wis. 2d 287, 785 N.W.2d 328.   
No. 
2016AP923-W   
 
30 
 
not self-executing and required a court order to have the force 
of law.32   
¶65 Furthermore, Article VII, Section 19 barred the office 
of masters in chancery entirely.33  Historically, masters in 
chancery in equity cases had their functions balloon as courts 
referred entire matters to them, and every proceeding before the 
master carried a fee.  This use of masters to decide cases for 
fees led to substantial abuses that increased the costs of 
litigation and caused delays.  Prohibitive costs and time-
consuming delay were viewed as violating a litigant's right to a 
speedy trial as much as no trial at all.  As a result, the 1848 
Wisconsin Constitution banned masters in chancery.34  
                                                 
32 Fairbanks v. Newton, 46 Wis. 644, 645, 1 N.W. 335 (1879) 
("[T]he 
report 
of 
itself 
entitles 
neither 
party 
to 
judgment. . . . It is the duty of the circuit court thereupon, 
before judgment, to hear the parties, and to make an order 
sustaining or overruling the exceptions, and confirming, setting 
aside or modifying the report."). 
33 Article VII, Section 19 of the pre-1977 Wisconsin 
Constitution provided:  "The testimony in causes in equity shall 
be taken in like manner as in cases at law, and the office of 
master in chancery is hereby prohibited."    
This provision was repealed in April 1977 when Wisconsin 
adopted the unified court system.  See 1975 J.R. 13, 1977 J.R. 
6. 
34 For discussions of the history of the abuses of masters 
in chancery in state and federal courts relating to expense and 
delay, see Simpson v. Canales, 806 S.W.2d 802, 806-08 (Tex. Dt. 
Ct 1991); Linda J. Silberman, Masters and Magistrates Part II: 
The American Analogue, 50 N.Y.U. L. Rev. 1297 (1975); Irving R. 
Kaufman, Masters in the Federal Courts: Rule 53, 58 Colum. L. 
Rev. 452, 452 n.4 (1958). 
No. 
2016AP923-W   
 
31 
 
¶66 Not all references were (or are) barred by the 
Wisconsin Constitution.  The use of referees serves as a 
valuable adjunct to the judicial process.  As judicial adjuncts, 
however, referees have to be supervised by the circuit court and 
their functions restricted.  The history of the masters in 
chancery teaches that we must guard against the unsupervised and 
unrestricted use of referees. 
¶67 The United States Supreme Court and federal courts of 
appeal have recognized that judges bear primary responsibility 
for the work of the courts and that a reference that would serve 
to relieve a court of its primary judicial powers is not 
permitted under Article III of the United States Constitution.35  
                                                 
35 La Buy v. Howes Leather Co., 352 U.S. 249, 256 (1957) 
(appointment of a master to try a case "amounted to little less 
than an abdication of the judicial function depriving the 
parties of a trial before the court on the basic issues involved 
in the litigation."); Ex parte Peterson, 253 U.S. 300, 312 
(1920).  See also Webster Eisenlohr, Inc. v. Kalodner, 145 F.2d 
316 (3d Cir. 1944), cert. denied, 325 U.S. 867 (1945), and 
federal court of appeals cases cited by 9 James Wm. Moore & 
Joseph C. Spero, Moore's Federal Practice § 53.03[3], n.13 (3d 
ed. 2016). 
Courts have expressed concern over the appointment of 
masters to consider dispositive pretrial motions.  The Federal 
Advisory Committee Note to Federal Rule of Civil Procedure 53 
states:  "At the extreme, a broad delegation of pretrial 
responsibility as well as a delegation of trial responsibilities 
can 
run 
afoul 
of 
Article 
III 
[of 
the 
United 
States 
Constitution]."   
(continued) 
No. 
2016AP923-W   
 
32 
 
Article III preserves to litigants their interest in an 
impartial and independent federal adjudication of claims within 
the judicial power of the United States and serves as a 
significant part of the constitutional system of checks and 
balances, preventing legislative transfer of jurisdiction to 
emasculate the constitutional courts.36   
¶68 Federal courts have attempted to delineate when a 
master 
assists 
a 
federal 
judge 
versus 
when 
a 
master 
unconstitutionally displaces a federal judge as adjudicator.   
¶69 In La Buy v. Howes Leather Co., 352 U.S. 249 (1957), 
the Court affirmed the Seventh Circuit's issuance of a writ of 
mandamus directing the district court to vacate a reference to a 
special master.  The reference essentially transferred the 
                                                                                                                                                             
For discussions of the use and limitations of masters in 
the federal courts, see Margaret G. Farrell, The Function and 
Legitimacy of Special Masters: Administrative Agencies for the 
Courts, 2 Widener L. Symp. J. 235 (1997); Irving R. Kaufman, 
Master in the Federal Courts: Rule 53, 58 Colum. L. Rev. 452 
(1958); 9C Charles A. Wright & Arthur R. Miller, Federal 
Practice and Procedure 2601-15 (3d ed. 2008); 9 James Wm. Moore 
& Joseph C. Spero, Moore's Federal Practice ch. 53 (3d ed. 
2016).   
For 
a 
discussion 
of 
Article 
III 
courts 
and 
the 
congressional power to create legislative courts, see Erwin 
Chemerinsky, Federal Jurisdiction ch. 4 (7th ed. 2016). 
For discussions of referees in Wisconsin and Wis. Stat. 
§ (Rule) 805.06, see 3A Jay E. Grenig, Wisconsin Practice 
Series:  Civil Procedure § 506.1-.8 (4th ed. 2010); Patricia 
Graczyk, The New Wisconsin Rules of Civil Procedure Chapters 
805-807, 59 Marq. L. Rev. 671, 680-85 (1976). 
36 Commodity Futures Trading Comm'n v. Schor, 478 U.S. 833, 
850 (1986). 
No. 
2016AP923-W   
 
33 
 
entire case, including the trial, to the master.  Giving such 
broad duties to a special master "amounted to little less than 
an abdication of the judicial function depriving the parties of 
a trial before the court on the basic issues involved in the 
litigation." La Buy, 352 U.S. at 256.  The Court noted that 
while masters could "aid judges" in the performance of limited 
duties, they could not be permitted to "displace the court."  La 
Buy, 352 U.S. at 256.   
¶70 Although the issue in La Buy was a trial conducted by 
a special master, the language and reasoning of the opinion have 
been applied by federal and state courts to the use of special 
masters or referees at all stages of litigation.  These courts 
have scrutinized appointments of special masters or referees to 
prevent them from replacing the judge in settings beyond the 
trial itself.   
¶71 When a federal district judge "referred an apparently 
urgent and contentious civil controversy to a special master, 
virtually for all purposes," the federal Court of Appeals for 
the District of Columbia Circuit instructed the district judge 
to revise the order of reference and "not delegate to the 
special master [ ] the core function of making dispositive 
rulings, including findings of fact and conclusions of law on 
issues of liability."37  The D.C. Circuit Court of Appeals struck 
down this broad reference because trial courts "ha[ve] no 
                                                 
37 In re Bituminous Coal Operators' Ass'n, 949 F.2d 1165, 
1166 (D.C. Cir. 1991).   
No. 
2016AP923-W   
 
34 
 
discretion to impose on parties against their will 'a surrogate 
judge,' 
a 
substitute 
from 
the 
private 
bar 
charged 
with 
responsibility for adjudication of the case."38     
¶72 The concern that a master will effectively replace the 
trial 
judge 
is 
especially 
apt 
when 
the 
master 
decides 
dispositive motions.  "Determining bottom-line legal questions 
is the responsibility of the court itself."39  
¶73 In United States v. Microsoft Corp., 147 F.3d 935, 
954-955 (D.C. Cir. 1998), the federal Court of Appeals for the 
District of Columbia Circuit vacated a reference to a special 
master to determine compliance under a consent decree.  The 
court of appeals rejected the United States' argument that 
having a special master oversee the implementation of a consent 
decree is a "well-established tradition."  Microsoft Corp., 147 
F.3d at 954.  Reasoning, instead, that the special master's 
duties involved interpretation and were "no more 'remedial' than 
would be those of any total referral of a contract case," the 
court held that the reference was fatally flawed because it 
                                                 
38 In re Bituminous Coal Operators Ass'n, 949 F.2d at 1168; 
Stauble v. Warrob, 977 F.2d 690, 695 (1st Cir. 1992) ("Because 
Rule 53 cannot retreat from what Article III requires, a master 
cannot supplant the district judge.  Determining bottom-line 
legal questions is the responsibility of the court itself." 
(citation omitted)). 
39 Stauble v. Warrob, Inc., 977 F.2d 690, 695 (1st Cir. 
1992); accord Prudential Ins. Co. v. U.S. Gypsum Co., 991 F.2d 
1080, 1084 (3rd Cir. 1993) (explaining that summary judgment and 
other dispositive motions "must be resolved prior to trial" and 
"traditionally have been decided by judges"). 
No. 
2016AP923-W   
 
35 
 
turned on the "determination of rights . . . ."  "[S]pecial 
masters may not decide dispositive pretrial motions."  Microsoft 
Corp., 147 F.3d at 954 (citing In re United States, 816 F.2d 
1083, 1090 (6th Cir. 1987)).40    
¶74 Several state courts also have not permitted circuit 
courts 
to 
delegate 
authority 
to 
a 
non-judge 
to 
decide 
dispositive motions or make legal determinations of rights.  
See, e.g., Salt Lake City v. Ohms, 881 P.2d 844, 848 (Utah 1994) 
(referees cannot "exercise th[e] judge's ultimate judicial 
power, for such is a nondelegable core judicial function"); 
Jovine v. FHP, Inc., 64 Cal. App. 4th 1506, 1509, 1523-24 (1998) 
(deciding dispositive motions is beyond a referee's authority; 
the responsibility to decide cannot be delegated without the 
express consent of the parties; the state constitution governs 
delegation of judicial power); Russell v. Thompson, 619 P.2d 
537, 539 (Nev. 1980) (a general reference by the circuit court 
of nearly all contested issues, giving the master the authority 
to decide substantially all issues in the case, as well as to be 
the fact finder, resulted in "the trial court's function [being] 
reduced to that of a reviewing court" and "this type of blanket 
                                                 
40 See also Beazer East, Inc. v. Mead Corp., 412 F.3d 429, 
442 (3rd Cir. 2005) (holding that a special master could not 
perform CERCLA equitable allocation involving "a complex and 
delicate determination of equities"); Burlington N.R.R. v. Dept. 
of Rev. of Wash., 934 F.3d 1064, 1073 (9th Cir. 1991) (district 
court's wholesale reference of the entire case to a master and 
rubber stamping of the master's order was abdication of judicial 
responsibility and violation of Article III of the United States 
Constitution). 
No. 
2016AP923-W   
 
36 
 
delegation approaches an unallowable abdication by a jurist of 
his constitutional responsibilities and duties;" although the 
master's report must be confirmed by the court before it is 
final, the reference is not saved "because the scope of review 
is so limited.").    
¶75 Our court, however, has not decided the outer limits 
placed by the state constitution on the use of referees.  But 
the Wisconsin Supreme Court very early declared that referees 
may share in judicial labor but cannot assume the place of the 
judge.  "[C]onstitutional judges . . . can take [no power] from 
the legislature, to subdelegate their judicial functions."41   
                                                 
41 In Van Slyke v. Trempealeau Co. Farmers' Mut. Fire Ins. 
Co., 39 Wis. 390, 392, 396 (1876), the court stated: 
It seems too manifest for discussion that, under the 
constitution, no one can hold a circuit court but a 
circuit judge. . . . If the statute before us could be 
upheld, we do not see why one could not which should 
assume to give to the parties, in all actions, in all 
courts, power to stipulate the judges off the bench, 
and private persons into their seats.  Judicial power 
is one of the attributes of sovereignty, necessarily 
delegated in its exercise.  The constitution does not 
leave the delegation loose at the discretion of the 
legislature.  It delegates the judicial power to 
constitutional courts, to be held by constitutional 
judges.  And these constitutional judges take no power 
from 
the 
constitution, 
can 
take 
none 
from 
the 
legislature, to subdelegate their judicial functions. 
. . . . 
[T]he 
circuit 
judge 
might 
be 
likened 
to 
the 
sun . . . and [the referee] to the moon . . . shining 
with delegated jurisdiction.  But the constitution 
mars 
the 
comparison. 
 
For 
by 
the 
astronomical 
constitution the sun appears to take power to delegate 
(continued) 
No. 
2016AP923-W   
 
37 
 
¶76 Because courts cannot delegate their judicial power, 
the reasoning of the federal and state cases barring courts from 
delegating core judicial powers——that is, powers to conduct 
trials, decide dispositive motions, or determine fundamental 
rights——provides a compelling measuring stick to determine 
whether the circuit court in the instant case impermissibly 
delegated judicial power to the referee.   
¶77 In the instant case, as we stated previously, the 
Order of Reference enables the referee to hear and decide all 
motions filed, whether discovery or dispositive, subject to 
review under the standard of erroneous exercise of discretion.  
We 
conclude 
that 
this 
Order 
impermissibly 
delegates 
constitutional "judicial power" to a referee, prohibiting the 
circuit court from freely rejecting the referee's rulings and 
conducting its own independent inquiry and reducing the function 
of the circuit court to that of a reviewing court.   
¶78 Insofar as the Order of Reference in the instant case 
gave the referee the "full authority of the [circuit] Court to 
hear and decide" all motions filed, including the authority to 
                                                                                                                                                             
his functions of lighting the world; while the state 
constitution 
tolerates 
no 
such 
delegation, 
and 
appoints a sun only, without any moon, as luminary of 
the 
circuit 
court, 
whose 
"gladsome 
light 
of 
jurisprudence" must be sunshine only, not moonshine.  
Commissioners, masters, referees, and like judicial 
subordinates, may share in judicial labor and lighten 
it; but they cannot change places with the judge on 
the bench or share in the final judgments of the 
court. 
No. 
2016AP923-W   
 
38 
 
hear and decide motions for injunctive relief, for partial 
summary judgment, or to limit evidence at trial, counsel for the 
circuit court and Judge DiMotto makes two arguments in the 
Order's defense.         
¶79 Counsel for the circuit court and Judge DiMotto first 
argues that the circuit court decided these issues de novo even 
though the Order of Reference declared that the circuit court 
would use the erroneous exercise of discretion standard, and 
that this de novo review of the referee's rulings cured any 
constitutional defects.  Second, counsel argues that this court 
should postpone ruling on whether the Order of Reference is 
valid in authorizing the referee to decide these issues until a 
possible ultimate appeal on the merits.   
¶80 We disagree with counsel.  Although Newtek contends 
that the circuit court did not actually exercise de novo review, 
we need not decide the actual nature of the circuit court's 
review of the referee's rulings.  Our focus in the instant case 
is on the validity of the Order, not on the conduct of the 
circuit court.42   
                                                 
42 Some federal courts have concluded that an improper 
delegation of traditional adjudicatory functions is not saved by 
de novo district court review of the master's ruling.  See 
Microsoft Corp., 147 F.3d at 956 (citing Stauble v. Warrob, 
Inc., 977 F.2d 690, 698 n.13 (1st Cir. 1992), and In re 
Bituminous Coal Operators' Ass'n, 949 F.2d 1165, 1168 (D.C. Cir. 
1991).  See also Beazer East, Inc. v. The Mead Corp., 412 F. 3d 
429, 444-45 (3d Cir. 2005). 
No. 
2016AP923-W   
 
39 
 
¶81 We also are not willing to delay consideration of the 
validity of the Order until after judgment is entered because, 
as we previously explained, the parties will be irreparably 
harmed should a decision on the validity of the Order of 
Reference be delayed until after final judgment and appeal. 
¶82 In sum, we conclude that the Order of Reference 
impermissibly 
delegated 
to 
the 
referee 
judicial 
power 
constitutionally vested in Wisconsin's unified court system.  A 
referee may share judicial labor, but the Order of Reference may 
not allow a referee to assume the place of the judge.  
Accordingly, the Order does not survive Newtek's constitutional 
challenge. 
V 
¶83 We examine whether the provision in the circuit 
court's Order of Reference that the circuit court's review of 
the referee's "rulings" shall be based only on the referee's 
"erroneous exercise of discretion" contravenes the constitution43 
and statutes or rules44 regarding circuit court and appellate 
court authority and practice. 
¶84 The Order of Reference provides for circuit court 
review of a referee's ruling under the erroneous exercise of 
discretion standard.   
                                                 
43 See, e.g., Wis. Const. art. VII, §§ 2, 8.  
44 See, e.g., Wis. Stat. ch. 808. 
No. 
2016AP923-W   
 
40 
 
¶85 This standard is not the same standard as a court's de 
novo review.  In a de novo review, the reviewing court reaches 
whatever decision it would reach independently of the decision 
of the prior decision maker.  In contrast, a circuit court that 
reviews a referee's ruling under the erroneous exercise of 
discretion standard is using the standard of review an appellate 
court ordinarily uses to review certain rulings of a circuit 
court.   
¶86 Under the erroneous exercise of discretion standard, 
an appellate court may affirm the circuit court's ruling even 
though the appellate court would not necessarily reach the same 
decision independently of the prior decision maker.  Thus, the 
Order of Reference gives the appearance of an abdication of the 
circuit court's responsibility to exercise independent judgment.   
¶87 The Order of Reference further gives the appearance of 
granting appellate authority to the circuit court when the 
legislature has not granted such appellate authority.  Article 
VII, Section 8 of the Wisconsin Constitution provides that "the 
circuit court shall have . . . such appellate jurisdiction in 
the circuit as the legislature may prescribe by law."  The 
legislature has not granted the circuit courts appellate 
jurisdiction over rulings by referees.   
¶88 We therefore conclude that the provision in the 
circuit court's Order of Reference that the circuit court's 
review of the referee's "rulings" shall be based on the 
referee's "erroneous exercise of discretion" contravenes the 
No. 
2016AP923-W   
 
41 
 
constitution, statutes, and rules regarding circuit court and 
appellate court authority and practice. 
VI 
¶89 We turn to the question of whether the circuit court's 
Order of Reference contravenes the parties' right to "obtain 
justice freely, and without being obliged to purchase it" 
guaranteed 
by 
Article 
I, 
Section 
9 
of 
the 
Wisconsin 
Constitution, or with due process of law, guaranteed by Article 
I, Section 1 of the Wisconsin Constitution, or with Newtek's 
right to a jury trial, guaranteed by Article I, Section 5 of the 
Wisconsin Constitution.45 
¶90 Newtek argues that the Order of Reference deprived it 
of its constitutional rights to present its claims and defenses 
to a court of competent jurisdiction.      
¶91 Wisconsin's constitutional framers, taking heed of 
Article 40 of the Magna Carta,46 provided in Article I, Section 9 
as follows:    
                                                 
45 Newtek asserts that the substantive rulings of the 
referee 
regarding 
its 
property 
interests 
in 
confidential 
information and its contractual rights to prevent Hicks from 
improperly using Newtek's goodwill and proprietary information 
deprived Newtek of property rights without due process, namely 
the right to be heard by the circuit court.  We need not reach 
this issue.   
46 Article 40 of the Magna Carta provides:  "To none will we 
sell, to none will we deny, or delay, right or justice".   
(continued) 
No. 
2016AP923-W   
 
42 
 
Every person is entitled to a certain remedy in the 
laws for all injuries, or wrongs which he may receive 
in his person, property, or character; he ought to 
obtain justice freely, and without being obliged to 
purchase it, completely and without denial, promptly 
and without delay, conformably to the laws.   
Wis. Const. art. I, § 9. 
¶92 The guarantee of Article I, Section 9 that "[e]very 
person is entitled to a certain remedy in the laws" does not 
mean a remedy that must be accompanied by a certainty of 
recovery.  This provision guarantees to every litigant a day in 
a court of competent jurisdiction to present claims for judicial 
relief; the litigant may either win or suffer defeat, according 
to the case presented.47   
                                                                                                                                                             
See, e.g., Aicher ex rel. LaBarge v. Wis. Patients Comp. 
Fund, 2000 WI 98, ¶42, 237 Wis. 2d 99, 121, 613 N.W.2d 849, 862 
("Our decisions trace [art. I, § 9's] origin to Paragraph 40 of 
the Magna Carta, which states: "To none will we sell, to none 
will we deny, or delay, right or justice.") (citing Vol. I 
Wisconsin Statutes 1898, Sanborn and Berryman's Annotations at 
9).   
47 New York Life Ins. Co. v. State, 192 Wis. 404, 412, 211 
N.W. 288 (1926), error dismissed, 276 U.S. 602 (1928).           
No. 
2016AP923-W   
 
43 
 
¶93 Article I, Section 9 does not bar litigants from 
having to pay reasonable court costs and fees, including referee 
fees.48 
¶94 Neither party argues that the $45,000 fee amounts to a 
bribe or was unreasonable in amount.  Neither party seeks a 
partial or full refund of the fees paid. 
¶95 The circuit court was right when it advised the 
parties that the referee "doesn't come cheap."  It encouraged 
the parties to consider the cost of the referee in deciding 
whether to raise issues and in making settlement decisions.  A 
referee's fees increase the costs of litigation and thus may 
have a chilling effect on litigants.  If the expenses are not 
circumscribed, 
people 
with 
meritorious 
claims 
will 
be 
                                                 
48 For discussions of Article I, Section 9, see, e.g., 
Aicher v. Wis. Patients Comp. Fund, 2000 WI 98, ¶¶41-47, 237 
Wis. 2d 99, 613 N.W.2d 849; Makos v. Wis. Masons Health Care 
Fund, 211 Wis. 2d 41, 52-54, 59-68, 78-87, 546 N.W.2d 662 
(1997); Treiber v. Knoll, 135 Wis. 2d 58, 72-74, 398 N.W.2d 756 
(1987); Manitowoc v. Manitowoc & N. Traction Co., 145 Wis. 13, 
18, 129 N.W. 925 (1911) (granting relief should not be made 
dependent on ability to furnish bond); Reistad v. Manz, 11 
Wis. 2d 155, 159, 105 N.W.2d 324 (1960), overruled on other 
grounds by Hansen v. A.H. Robins, Inc., 113 Wis. 2d 550, 335 
N.W.2d 578 
(1983); 
Mulder 
v. 
Acme-Cleveland 
Corp., 
95 
Wis. 2d 173, 189, 290 N.W.2d 276 (1980); Portage Cty. v. 
Steinpreis, 104 Wis. 2d 466, 476-77, 312 N.W.2d 731 (1981); 
Christianson v. Pioneer Furniture Co., 101 Wis. 2d 343, 347-48, 
77 N.W. 174 (1898); State ex rel. Baker v. Cty. Court of Rock 
Cty., Branch I, 29 Wis. 2d 1, 12, 138 N.W.2d 162, 168 (1965) 
(Article I, Section 9 "guarantees that persons will not have to 
bribe or make arbitrary payments to officials in order to obtain 
justice."). 
No. 
2016AP923-W   
 
44 
 
discouraged from pursuing them in court because they cannot 
afford to go to court.        
¶96 A reference to a referee in effect requires litigants 
to pay for the court system twice——once through the tax system 
and a second time by paying fees to a referee for resolution of 
their suit.     
¶97 We need not decide this case on the basis of Article 
I, Section 9.  Nevertheless, we note that appointment of a 
referee is for the exceptional case; it is not the general rule.  
Furthermore, as Hicks correctly acknowledged, referee fees may 
offend constitutional mandates "if they chill advocacy severely 
enough to 'effectively end the litigation' or impose 'an 
intolerable burden on a losing litigant,'" citing Peter v. 
Progressive Corp., 986 P.2d 865, 873 (Alaska 1999).  Hicks notes 
that Newtek has not attempted to demonstrate that the referee's 
fees in the instant case rise to this level.  We therefore do 
not rest our decision on Article I, Section 9 of the Wisconsin 
Constitution.   
¶98 The costs of litigation can price people out of the 
constitutionally established state judicial system.  Yet justice 
should be available to all persons regardless of financial 
means.  The Wisconsin Constitution embodies the principle that 
courts are an essential and integral part of Wisconsin's 
government, open to the people, and the cost thereof is borne as 
a public expense. 
¶99 Circuit courts must heed the admonitions of the Alaska 
Supreme Court, which warned of denying litigants the right of 
No. 
2016AP923-W   
 
45 
 
access to courts and due process by appointment of referees as 
follows:  
More fundamentally, all potential litigants——not just 
those who are indigent——have a constitutional right in 
Alaska of meaningful access to the justice system.  
Prohibitively high master's fees could potentially 
jeopardize such access. . . . Even if an imposition of 
costs or fees is valid on its face, it may offend due 
process because it operates to foreclose a particular 
party's opportunity to be heard. We believe the 
ultimate test . . . is whether the [cost] is so great 
that it imposes an intolerable burden on a losing 
litigant which, in effect, denies the litigant's right 
of access to the courts.  
Peter v. Progressive Corp., 986 P.2d 865, 872-73 (Alaska 1999) 
(internal 
quotation 
marks 
and 
citations 
omitted). 
 
The 
California court of appeals similarly stated: 
Allowing 
trial 
courts 
routinely 
to 
shift 
their 
responsibilities to private judges unfairly requires 
the litigants, who are already paying taxes to fund 
the operation of the courts, to also bear the very 
substantial cost of private judges . . . . [S]uch a 
burden ultimately could discourage . . . meritorious 
claims . . . .  
Jovine v. FHP, Inc., 64 Cal. App. 4th 1506, 1531 (1998). 
¶100 In addition to raising Article I, Section 9 concerns 
and access to justice concerns, Newtek also raises due process 
issues.  Basic to due process is procedural fairness——notice, 
the opportunity to be heard, and the accurate and fair 
adjudication of disputes.  Delay and expense may deprive 
litigants of the fair adjudication of their disputes guaranteed 
by due process.   
¶101 Newtek asserts that the substantive rulings of the 
referee 
regarding 
its 
property 
interests 
in 
confidential 
No. 
2016AP923-W   
 
46 
 
information and its contractual rights to prevent Hicks from 
improperly using Newtek's good will and proprietary information 
deprived Newtek of property rights without due process, that is, 
the right to be heard by the circuit court.   
¶102 We need not and do not decide the instant case on the 
due process clause of Article I, Section 1.  It is important, 
however, to take note of the court's statement in Piper v. Popp, 
167 Wis. 2d 633, 644, 482 N.W.2d 353 (1992), describing the 
constitutional creation of the court system and due process as 
ensuring access to the courts as follows: 
[W]e begin with the axiom that before the state may 
deprive an individual of life, liberty or property, 
the state must accord the individual a meaningful 
opportunity to be heard.  In other words, litigants 
must be given their day in court.  Access to the 
courts 
is 
an 
essential 
ingredient 
of 
the 
constitutional guarantee of due process.  Whatever the 
precise status of the right of access to the courts, 
due process is satisfied "if the procedures provide an 
opportunity to be heard at a meaningful time and in a 
meaningful matter."49 
¶103 Finally, Newtek asserts, inter alia, that the Order 
contravenes Newtek's constitutional right to a trial by jury by 
                                                 
49 Piper v. Popp, 167 Wis. 2d 633, 644, 482 N.W.2d 353 
(1992) (footnote omitted) (citing State ex rel. Strykowski v. 
Wilkie, 81 Wis. 2d 491, 512, 261 N.W.2d 434 (1987) (citing 
Mathews v. Eldridge, 424 U.S. 319, 335 (1976))).  See also 
Penterman v. Wis. Elec. Power Co., 211 Wis. 2d 458, ¶25, 565 
N.W.2d 521 (1997) (the right of access to the courts is secured 
by the First and Fourteenth Amendments and "exists where the 
claim has a 'reasonable basis in fact or law'"; "Judicial access 
must be 'adequate, effective and meaningful'" (quoted sources 
omitted).).  
No. 
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47 
 
authorizing the referee to make binding determinations of fact, 
citing In re Peterson, 253 U.S. 300, 310-11 (1920).50  In view of 
our decision that the Order of Reference contravenes Article 
VII, Section 2 of the Wisconsin Constitution, which vests 
judicial power in the unified court system, we need not and do 
not reach the issue of whether the Order comports with or 
contravenes the right to jury trial guaranteed by Article I, 
Section 5.51   
VII 
¶104 The last two issues we must address are whether any 
orders of the referee survive and whether we should grant 
Newtek's request that we direct that a new judge be assigned on 
remand. 
¶105 Certain discovery orders survive.  Insofar as the 
Order of Reference in the instant case authorized the referee to 
supervise pretrial discovery disputes, the Order did not 
contravene the Wisconsin Constitution's vesting of judicial 
power in a unified court system.  Discovery issues are often 
                                                 
50 The court held in In re Peterson, 253 U.S. 300, 310-11 
(1920), that the appointment of an auditor by the federal judge 
to make and file a report with a view to simplifying the issues 
for the jury but not to finally determine any of the issues in 
the action was not an unconstitutional interference with the 
jury's determination of fact; the auditor's report was to be 
admitted at the jury trial as evidence of the facts and findings 
embodied therein.  
51 We note that the 2003 revised version of Federal Rule of 
Civil Procedure 53 permits appointment of a trial master in an 
action to be tried by jury only if the parties consent. 
No. 
2016AP923-W   
 
48 
 
referred to a master in federal courts.  9C Charles A. Wright & 
Arthur R. Miller, Federal Practice and Procedure § 2602.1 (3d 
ed. 2008).  Indeed, masters have been particularly helpful for 
overseeing discovery in complex federal cases.  9 James Wm. 
Moore 
& 
Joseph 
C. 
Spero, 
Moore's 
Federal 
Practice 
§ 53.10[3][c][ii] (3d ed. 2016). 
¶106 Accordingly, if neither party raised an objection to a 
referee's ruling or order on discovery, that ruling or order 
remains in full force and effect.  If, however, either party 
raised an objection to a referee's ruling or order on discovery 
(whether or not reviewed by the circuit court), that ruling or 
order is vacated. 
¶107 Because 
the 
Order 
of 
Reference 
impermissibly 
authorized the referee to rule on dispositive motions, any such 
referee rulings and the circuit court's orders adopting the 
referee's recommended rulings on dispositive motions, such as 
the parties' motions for summary judgment, are vacated. 
¶108 Finally, Newtek requests that we direct that a new 
judge be assigned to the matter on remand.  Counsel for the 
circuit court objects, observing that Wis. Stat. § 801.58(7) 
permits a party to request substitution of a judge, within 20 
days after the remittitur is filed in the circuit court, "[i]f 
upon an appeal from a judgment or upon a writ of error the 
appellate court . . . reverses or modifies the judgment or 
order . . . ." 
¶109 True, the statute limits substitution to appeals and 
writs of error, and a petition for a supervisory writ is neither 
No. 
2016AP923-W   
 
49 
 
an appeal nor a writ of error.  But, as counsel for the circuit 
court forthrightly explains, this court has stated that Wis. 
Stat. § 801.58(7) "'creates an unqualified right to substitution 
when further trial court proceedings are necessary after remand 
from an appellate court.'"  State ex rel. J.H. Findorff v. 
Circuit Court for Milwaukee County, 2000 WI 30, ¶13, 233 
Wis. 2d 428, 608 N.W.2d 679 (quoting State ex rel. Oman v. 
Hunkins, 120 Wis. 2d 86, 91, 352 N.W.2d 220 (Ct. App. 1984)). 
¶110 Because we reverse orders of the circuit court and 
remand this matter to the circuit court for further proceedings, 
and this matter seems to fall within the reach of Wis. Stat. 
§ 801.58(7), we permit either party to seek a substitution of 
judge pursuant to the procedures set forth in Wis. Stat. 
§ 801.58(1) and (7).  Because there is no record in this court 
in the instant case to be remitted, the 20-day period provided 
in Wis. Stat. § 801.58(7) should be triggered by this court's 
transmittal of its judgment and opinion to the circuit court.  
See Wis. Stat. § (Rule) 809.26(2). 
¶111 For the reasons set forth, we conclude as follows: 
1. 
Newtek's petition for a supervisory writ does not meet 
the 
requirements 
set 
forth 
in 
Wis. 
Stat. 
§ (Rule) 809.71.  The petition was not first filed in 
the court of appeals and Newtek has failed to show 
that it was impractical to file the petition in the 
court of appeals.  We do, however, exercise our 
constitutional superintending authority under Article 
VII, Section 3(2) of the Wisconsin Constitution to 
No. 
2016AP923-W   
 
50 
 
determine the validity of the Order of Reference.  A 
declaration of rights is an appropriate vehicle for an 
exercise of the superintending authority over circuit 
courts constitutionally granted to this court.52   
2. 
Regardless of whether Newtek has waived or forfeited 
its right to challenge the Order of Reference, is 
estopped from challenging the Order, or has impliedly 
consented to the reference, this court may resolve the 
issue of the validity of the Order of Reference under 
its constitutional superintending authority.   
3. 
The Order of Reference impermissibly delegated to the 
referee judicial power constitutionally vested in 
Wisconsin's unified court system.  Accordingly, the 
Order 
does 
not 
survive 
Newtek's 
constitutional 
challenge. 
4. 
The circuit court's Order of Reference, including the 
provision that the circuit court's review of the 
referee's "rulings" shall be based only on the 
referee's 
"erroneous 
exercise 
of 
discretion," 
contravenes the constitution, statutes, and rules 
regarding circuit court and appellate court authority 
and practice.  It infringes on the legislature's 
authority to define a circuit court's appellate 
jurisdiction.    
                                                 
52 State ex rel. Memmel v. Mundy, 75 Wis. 2d 276, 281, 249 
N.W.2d 573 (1977). 
No. 
2016AP923-W   
 
51 
 
5. 
We do not decide the instant case on the basis of 
Article I, Section 9 of the Wisconsin Constitution, 
the due process clause of Article I, Section 1 of the 
Wisconsin Constitution, or the right to jury trial of 
Article I, Section 5 of the Wisconsin Constitution, 
but we note that reference to a referee is the 
exception, not the rule; that there are constitutional 
limits on the powers of a referee; and that a 
reference can jeopardize a litigant's access to the 
justice system, due process, and right to a jury 
trial.  The Wisconsin Constitution requires the state 
to provide a judicial system for the resolution of 
disputes.  Access to state courts for conflict 
resolution is thus implicit in the state constitution.  
We express our concern that the use of referees 
increases the costs of litigation and may cause delay 
and, as a practical matter, may deprive litigants of 
access to the courts.   
6. 
To the extent the parties have agreed to abide by an 
order or ruling of the referee relating to discovery, 
that ruling or order shall stand.  To the extent 
either party has objected to an order or ruling of the 
referee relating to discovery, that ruling or order 
shall be vacated.  Any ruling or order of the referee 
on a dispositive motion is vacated.  Either party may 
request substitution of the judge pursuant to Wis. 
Stat. § 801.58(1) and (7).   
No. 
2016AP923-W   
 
52 
 
By the Court.—The petition for supervisory writ is denied.  
Rights declared. 
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No.  2016AP923-W.akz 
 
1 
 
¶112 ANNETTE KINGSLAND ZIEGLER, J.   (concurring in part, 
dissenting in part).  The court denies Newtek's petition for a 
supervisory writ.  I join that denial.  I depart, however, from 
the court's decision to nevertheless address broader underlying 
issues because this court's determination should end with the 
fact that Newtek's petition fails for procedural reasons.  I 
will now discuss why I depart from my colleagues.  
¶113 Under Wis. Stat. § (Rule) 809.71: 
A person seeking a supervisory writ from the supreme 
court shall first file a petition for a supervisory 
writ in the court of appeals under s. 809.51 unless it 
is impractical to seek the writ in the court of 
appeals. A petition in the supreme court shall show 
why it was impractical to seek the writ in the court 
of appeals . . . . 
Wis. Stat. § (Rule) 809.71.  Newtek did not first file a 
petition for a supervisory writ in the court of appeals.  Nor 
did Newtek provide an adequate justification for its failure to 
do so (Newtek points only to the fact that the court of appeals 
denied its procedurally and substantively dissimilar request to 
appeal from a nonfinal order). 
¶114 Even if Newtek had met Wis. Stat. § (Rule) 809.71, 
under our precedent "[a] petition for a supervisory writ will 
not be granted unless," inter alia, "the request for relief is 
made promptly and speedily."  Burnett v. Alt, 224 Wis. 2d 72, 
96-97, 589 N.W.2d 21 (1999) (quoting State ex rel. Oman v. 
Hunkins, 120 Wis. 2d 86, 91, 352 N.W.2d 220 (Ct. App. 1984) (per 
curiam)).  Newtek did not meet that condition in this case.  
Instead, Newtek failed to take meaningful steps toward obtaining 
relief for months while the referee ruled on numerous motions.   
No.  2016AP923-W.akz 
 
2 
 
¶115 Thus, the court is correct to deny Newtek's petition 
for a supervisory writ, and that should be the end of the case.  
Nonetheless, 
the 
court 
proceeds 
to 
address 
a 
number 
of 
constitutional issues and ultimately grants Newtek relief 
anyway.  I do not agree with court's decision to do so.  While 
the court raises important issues, it finds itself in a less 
than desirable position to fully address these issues.  What, 
precisely, occurred below was not adequately briefed or argued.  
We remain without the benefit of all of the circuit court's 
reasoning in its review of the referee's determinations.  The 
court proceeds to determine the underlying issues without 
knowing whether the circuit court agreed or disagreed with the 
referee or reached its own conclusions.  If the judge did so 
independently rule, it could be that it is, at most, harmless 
error to have assigned such broad authority initially to the 
referee.  Because this case should be decided on more narrow 
grounds and we are without a full record, I would not 
unnecessarily 
delve 
into 
the 
many 
complex 
constitutional 
questions the court feels compelled to address. 
¶116 Newtek petitioned this court for a supervisory writ.  
Simply stated, it did not meet the requirements for the issuance 
of the writ.  This should end the analysis.  Because the court 
continues further, I respectfully concur in part and dissent in 
part. 
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¶117 REBECCA GRASSL BRADLEY, J.   (concurring in part, 
dissenting 
in 
part). 
 
Universal 
Processing 
Services 
of 
Wisconsin, LLC, doing business as Newtek, petitioned this court 
for a supervisory writ only after first acquiescing to discovery 
under the Order of Reference (the "Reference"), receiving an 
adverse summary judgment decision, and failing to persuade the 
court of appeals to grant interlocutory review.  Now, Newtek 
raises various challenges to the Reference, under which it 
engaged in discovery without objection for nearly a year.  
Because Newtek's objections are untimely and not properly before 
this court, I concur in the majority's decision to deny the 
petition for a supervisory writ.1 
¶118 Nevertheless, 
I 
respectfully 
dissent 
from 
the 
majority's declaration of rights pursuant to this court's 
superintending 
authority 
under 
the 
Wisconsin 
Constitution.  
Although I agree with the majority's conclusion that the 
Reference 
impermissibly 
delegated 
the 
circuit 
court's 
constitutionally vested judicial power to the referee,2 I 
disagree with its decision to grant retrospective relief to a 
party that sat on its rights and did not follow proper 
                                                 
1 Accordingly, I agree with and join the majority opinion’s 
analysis in Part II to the extent it concludes "the petition is 
not properly before this court."  Majority op., ¶36. 
2 I 
join 
parts 
I 
and 
V 
of 
the 
majority 
opinion.  
Additionally, I join Part IV of the majority opinion, except its 
determination that "the parties will be irreparably harmed 
should a decision on the validity of the Order of Reference be 
delayed until after final judgment and appeal."  Majority op., 
¶81.  I would not reach the issues discussed in Part VI of the 
majority opinion. 
No.  2016AP923-W.rgb 
 
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procedures when petitioning this court.3  The majority opinion, 
in effect, grants the writ despite technically denying it.  I 
disagree with the majority's approach and would instead employ 
this court's superintending authority to prospectively vacate 
the 
Reference 
to 
the 
extent 
it 
violates 
the 
Wisconsin 
Constitution.4 
I 
¶119 Two procedural deficiencies hamper Newtek's petition.  
First, Newtek skipped the court of appeals without an adequate 
justification and instead filed its petition first in this 
court.  Second, Newtek failed to timely object to the Reference.  
Either deficiency alone provides a sufficient basis for denying 
the writ; together, they prove fatal.  See Burnett v. Alt, 224 
Wis. 2d 72, 96, 589 N.W.2d 21 (1999). 
A 
¶120 Wisconsin Stat. § (Rule) 809.71 (2015-16)5 establishes 
the procedure for asking this court to issue a supervisory writ: 
A person may request the supreme court to exercise its 
supervisory jurisdiction over a court and the judge 
presiding therein or other person or body by filing a 
petition in accordance with s. 809.51.  A person 
seeking a supervisory writ from the supreme court 
                                                 
3 I therefore agree with much of Part III of the majority 
opinion, except that I would discuss the merits of the petition 
prospectively only with respect to these parties, so as to 
provide guidance to courts and litigants. 
4 As a result, I do not join Part VII of the majority 
opinion. 
5 All subsequent references to the Wisconsin Statutes are to 
the 2015-16 version unless otherwise indicated. 
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shall first file a petition for a supervisory writ in 
the court of appeals under s. 809.51 unless it is 
impractical to seek the writ in the court of appeals.  
A petition in the supreme court shall show why it was 
impractical to seek the writ in the court of appeals 
or, if a petition had been filed in the court of 
appeals, the disposition made and reasons given by the 
court of appeals. 
In this case, Newtek did not file a petition for a supervisory 
writ in the court of appeals before filing its petition in this 
court; consequently, this court will grant the writ only if 
Newtek "show[s] why it was impractical to seek the writ in the 
court of appeals," as § (Rule) 809.71 requires.  See Burnett, 
224 Wis. 2d at 96.  To justify ignoring the words of the statute 
and filing with us first, Newtek explains it "determined that it 
would be impractical to petition the court of appeals to issue a 
writ directing the circuit court to vacate the appointment" 
after "the court of appeals declined to review the referral on 
Newtek's petition for interlocutory review." 
¶121 Like the majority, I am not persuaded that the court 
of appeals' denial of interlocutory review made it impractical 
for Newtek to seek a supervisory writ from that court.  See 
majority op., ¶¶41-44.  Interlocutory review and supervisory 
writs are distinct procedural devices and implicate different 
legal 
standards. 
 
The 
court 
of 
appeals 
may 
permit 
an 
interlocutory appeal if it determines that immediate review of a 
non-final order will "[m]aterially advance the termination of 
the 
litigation 
or 
clarify 
further 
proceedings 
in 
the 
litigation," "[p]rotect the petitioner from substantial or 
irreparable 
injury," 
or 
"[c]larify 
an 
issue 
of 
general 
importance in the administration of justice."  Wis. Stat. 
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§ 808.03(2)(a)-(c). 
 
By 
contrast, 
a 
"supervisory 
writ . . . serves a narrow function:  to provide for the direct 
control of lower courts, judges, and other judicial officers who 
fail to fulfill non-discretionary duties, causing harm that 
cannot be remedied through the appellate review process."  State 
ex rel. Kalal v. Circuit Ct. for Dane Cty., 2004 WI 58, ¶24, 271 
Wis. 2d 633, 681 N.W.2d 110. 
¶122 Although both legal standards account for possible 
irreparable harm in the absence of extraordinary review, they 
otherwise diverge:  a request for interlocutory review focuses 
on efficient resolution of the litigation, whereas supervisory 
writ proceedings evaluate whether a judicial officer complied 
with obligations under the law.  A circuit court's actions may 
not warrant interlocutory review on the merits but could 
nevertheless require correction by an appellate court exercising 
its supervisory authority. 
¶123 Newtek 
presents 
solely 
a 
conclusory 
claim 
that 
petitioning the court of appeals for a supervisory writ was 
impractical, and as the majority correctly holds, we should not 
"cast doubt on the continued vitality of the 'impracticality' 
requirement."  Majority op., ¶44.  Because Newtek failed to 
follow the statutory procedure for issuance of a writ, this 
court should deny the petition. 
B 
¶124 Also problematic for Newtek is its substantial delay 
in raising any objection to the Reference.  Even if this court 
were to look past Newtek's failure to comply with the procedures 
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in Wis. Stat. § (Rule) 809.71, Newtek's year-long compliance 
with the Reference undermines the merits of its petition.  To 
obtain a supervisory writ, a party must make four showings:  (1) 
appeal 
is 
an 
inadequate 
remedy; 
(2) 
grave 
hardship 
or 
irreparable harm will result from inaction; (3) the circuit 
court's duty is plain, and the court violated or intends to 
violate that duty; and (4) the request is prompt and speedy.  
State ex rel. Two Unnamed Petitioners v. Peterson, 2015 WI 85, 
¶80, 
363 
Wis. 2d 1, 
866 
N.W.2d 165 
(citing 
Kalal, 
271 
Wis. 2d 633, ¶17). 
¶125 Here, Newtek fails to satisfy the fourth criterion 
because its request was neither prompt nor speedy.  Instead of 
challenging the Reference on the record as soon as the circuit 
court entered the order, Newtek assented to discovery under the 
referee's supervision for months, accepting many discovery 
rulings without objection.  Indeed, Newtek's only objections 
came when it received unfavorable decisions from the referee:  
it objected to some of the referee's discovery decisions under 
the procedure specified in the Reference, and it aggressively 
challenged the referee's summary judgment determinations in the 
circuit court, the court of appeals, and now this court. 
¶126 Newtek's 
delayed 
objection 
to 
the 
Reference 
illustrates why a writ will issue only when a party makes a 
prompt and speedy request for relief.  In the absence of a 
timely-request 
requirement, 
a 
strategic 
party 
could 
intentionally wait to file a petition for a writ until after the 
referee made an adverse decision.  That way, the party could 
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6 
 
accept 
favorable 
decisions 
while 
preserving 
a 
method 
of 
collaterally attacking an unacceptably unfavorable one.  If the 
party suspected or knew from the outset that constitutional 
deficiencies marred the reference, it could then rely on a 
supervisory writ to secure a "do-over," essentially using the 
supervisory writ as an interlocutory appeal——even though a "writ 
of supervision is not a substitute for an appeal."  Kalal, 271 
Wis. 2d 633, ¶17 (quoting State ex rel. Dressler v. Circuit Ct. 
for Racine Cty., 163 Wis. 2d 622, 630, 472 N.W.2d 532 (Ct. App. 
1991)). 
¶127 Nothing prevented Newtek from petitioning the court of 
appeals for a supervisory writ as soon as the circuit court made 
the Reference.  Newtek's counsel acknowledged as much during 
oral arguments before this court.  The serious problems we 
identify with the Reference suggest Newtek likely possessed a 
meritorious claim, had it promptly pursued a remedy.  But it did 
not do so.  Because Newtek instead challenged the Reference only 
after losing on summary judgment, it failed to timely seek 
relief.  This failure, coupled with its failure to seek relief 
from the court of appeals before petitioning this court for a 
supervisory writ, warrants denial of its petition and the 
retrospective relief it requested. 
II 
¶128 Despite 
the 
procedural 
deficiencies 
in 
Newtek's 
petition, I agree with the majority that this court should 
address the merits of the constitutional questions raised by 
this Reference.  See Kalal, 271 Wis. 2d 633, ¶26 ("Although the 
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Kalals have failed to establish the existence of a plain duty 
and are not entitled to a supervisory writ, we will address the 
statutory interpretation question presented by this case.").  
Referees offer circuit courts a valuable tool for efficiently 
allocating court time and resources, so questions about the 
constitutionally permissible scope of an order of reference are 
likely to continue to arise.  After thorough briefing and 
argument by adverse, interested parties, this petition offers 
the court an opportunity to evaluate a particular order for 
compliance with the referee statute.  Examining the proper use 
of statutorily permissible referees allows us to give guidance 
to 
courts 
and 
litigants, 
thus 
mitigating 
uncertainty 
in 
Wisconsin courts.  In support of that endeavor, I write to 
supplement the already comprehensive discussion in Part III of 
the majority opinion. 
¶129 Our evaluation of the Reference at issue here must 
begin with the text of Wis. Stat. § 805.06, which authorizes the 
appointment of referees, establishes the circumstances under 
which a circuit court may make a reference, and delineates some 
powers and tasks that a circuit court may permissibly delegate.  
"A court in which an action is pending may appoint a referee," 
§ 805.06(1), but "[a] reference shall be the exception and not 
the rule," § 805.06(2).  Subsection (2) goes on to explain when 
a court may appoint a referee: 
In actions to be tried by a jury, a reference shall be 
made only when the issues are complicated; in actions 
to be tried without a jury, save in matters of account 
and of difficult computation of damages, a reference 
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8 
 
shall 
be 
made 
only 
upon 
a 
showing 
that 
some 
exceptional condition requires it. 
Subsection (3) then lays out the referee's powers and the 
circuit court's ability to describe and restrain them: 
The order of reference to the referee may specify 
or limit the referee's powers and may direct the 
referee to report only upon particular issues or to do 
or perform particular acts or to receive and report 
evidence only and may fix the time and place for 
beginning and closing the hearings and for the filing 
of 
the 
referee's 
report. 
 
Subject 
to 
the 
specifications and limitations stated in the order, 
the referee has and shall exercise the power to 
regulate all proceedings in every hearing before the 
referee and to do all acts and take all measures 
necessary or proper for the efficient performance of 
duties under the order.  The referee may require the 
production of evidence upon all matters embraced in 
the reference, including the production of all books, 
papers, vouchers, documents, and writings applicable 
thereto.  The referee may rule upon the admissibility 
of evidence unless otherwise directed by the order of 
reference and has the authority to put witnesses on 
oath and may personally examine them and may call the 
parties to the action and examine them upon oath.  
When a party so requests, the referee shall make a 
record of the evidence offered and excluded in the 
same manner and subject to the same limitations as a 
court sitting without a jury. 
Wis. Stat. § 805.06(3).  Under the limited circumstances when a 
reference is appropriate, § 805.06 affords the circuit court 
significant flexibility in assigning responsibilities to the 
referee. 
¶130 When making a reference under Wis. Stat. § 805.06, 
however, 
a 
circuit 
court 
must 
remain 
mindful 
of 
its 
responsibilities under the Wisconsin Constitution.  Cf. Marbury 
v. Madison, 5 U.S. (1 Cranch) 137, 177 (1803) ("[A]n act of the 
legislature, repugnant to the constitution, is void.").  In 
Wisconsin, "The judicial power of this state shall be vested in 
No.  2016AP923-W.rgb 
 
9 
 
a unified court system consisting of one supreme court, a court 
of appeals, a circuit court, such trial courts of general 
uniform statewide jurisdiction as the legislature may create by 
law, 
and 
a 
municipal 
court 
if 
authorized 
by 
the 
legislature . . . ."  Wis. Const. art. VII, § 2.  Analogizing to 
the federal Constitution, this court has explained that "the 
judicial power is the power to hear and determine controversies 
between parties before courts," which means that "the judicial 
power is the ultimate adjudicative authority of courts to 
finally 
decide 
rights 
and 
responsibilities 
as 
between 
individuals."  State v. Williams, 2012 WI 59, ¶36, 341 
Wis. 2d 191, 814 N.W.2d 460.   
¶131 As the majority describes, "[a] referee may share 
judicial labor, but the Order of Reference may not allow a 
referee to assume the place of the judge" by exercising the 
judicial power the constitution confers on circuit courts.  
Majority op., ¶82.  The judicial power vested in the circuit 
courts by the constitution places an outer limit on the scope of 
permissible delegation to referees.  For help identifying that 
constitutional boundary, federal appellate court decisions offer 
two key insights.6 
                                                 
6 "It is a well-settled principle of Wisconsin law 'that 
where a Wisconsin Rule of Civil Procedure is based on a Federal 
Rule of Civil Procedure, decisions of the federal courts, to the 
extent they show a pattern of construction, are considered 
persuasive authority.'"  J.L. Phillips & Assocs. v. E & H 
Plastic Corp., 217 Wis. 2d 348, 356, 577 N.W.2d 13 (1998) 
(quoting 
Neylan 
v. 
Vorwald, 
124 
Wis. 2d 85, 
99-100, 
368 
N.W.2d 648 (1985)).  The current language of Wis. Stat. § 805.06 
parallels the language of Rule 53 as it existed before 2003.  
See Fed. R. Civ. P. 53, 28 U.S.C. 782 (2000) (amended 2003). 
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¶132 First, as the majority notes, an order of reference is 
an improper delegation of the judicial power when it grants the 
authority to make dispositive decisions.  See majority op., 
¶67 n.35, ¶¶72-74.  "The use of masters is to aid judges in the 
performance 
of 
specific 
judicial 
duties . . . and 
not 
to 
displace the court."  La Buy v. Howes Leather Co., 352 U.S. 249, 
256 (1957) (internal quotation mark omitted) (quoting Ex parte 
Peterson, 253 U.S. 300, 312 (1920)).  A court issuing an order 
of reference must ultimately retain the adjudicative authority 
implicated by the judicial power derived from the applicable 
constitution.  See United States v. Microsoft Corp., 147 F.3d 
935, 954 (D.C. Cir. 1998) ("The concern about nonconsensual 
references turns on the determination of rights . . . .  It is 
for this reason that special masters may not decide dispositive 
pretrial motions."); Stauble v. Warrob, Inc., 977 F.2d 690, 696 
(1st Cir. 1992) ("[R]eference of fundamental issues of liability 
to a master for adjudication is not consonant with either Rule 
53 or Article III."); Burlington N. R.R. Co. v. Dep't of 
Revenue, 934 F.2d 1064, 1072 (9th Cir. 1991) ("[T]he district 
court's 'rubber stamp' of the master's order is an inexcusable 
abdication of judicial responsibility and a violation of article 
III of the Constitution."); In re United States, 816 F.2d 1083, 
1091 
(6th 
Cir. 
1987) 
("[E]ven 
though 
the 
reference 
of 
nondispositive discovery matters may be justified . . . , it 
will be the extremely rare case where the reference of a 
dispositive matter (be it a pretrial motion for summary judgment 
or the actual trial) will be appropriate."). 
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¶133 Second, the exceptional circumstances justifying an 
order of reference do not exist where the trial court is merely 
busy, dealing with a case involving a large number of parties, 
or working with an unfamiliar area of law.  Most federal 
appellate courts point to the Supreme Court's opinion in La Buy 
v. Howes Leather Co., 352 U.S. 249 (1957), which made quick work 
of several proffered justifications.  The Court first concluded 
that "congestion [on a court's docket] in itself is not such an 
exceptional circumstance as to warrant a reference to a master."  
Id. at 259.  Neither did the Court accept the case's "unusual 
complexity of . . . both fact and law" as an exceptional 
circumstance, 
observing 
that, 
"[o]n 
the 
contrary, . . . [complexity] is an impelling reason for trial 
before a regular, experienced trial judge rather than before a 
temporary substitute appointed on an ad hoc basis."  Id.  "Nor," 
the Court added, "does . . . the great length of time [that] 
trials will require offer exceptional grounds."  Id. 
¶134 In the decades since the Supreme Court decided LaBuy, 
federal appellate courts have maintained a high bar to meet the 
exceptional circumstances requirement.  See, e.g., Prudential 
Ins. Co. of Am. v. U.S. Gypsum Co., 991 F.2d 1080, 1086-87 (3d 
Cir. 1993) (observing that no special masters employed in two 
cases involving, respectively, 24 foreign electronics producers 
and 30,000 school districts across 54 jurisdictions (first 
citing In re Japanese Elec. Prods. Antitrust Litig., 723 F.2d 
238 (3d Cir. 1983) (subsequent history omitted); then citing In 
re Sch. Asbestos Litig., 977 F.2d 764 (3d Cir. 1992))); Stauble, 
No.  2016AP923-W.rgb 
 
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977 F.2d at 695 (declining to "forge an 'exceptional condition' 
test for cases of blended liability and damages"); In re United 
States, 816 F.2d at 1089 ("[T]he interest in a quick resolution 
of the case is simply an alternative way of asserting calendar 
congestion and the possibility of a lengthy trial as exceptional 
conditions . . . ."); Madrigal Audio Labs., Inc. v. Cello, Ltd., 
799 F.2d 814, 818 & n.1 (2d Cir. 1986) (rebuking trial judge for 
appointing special master because the judge stated he did not 
"understand anything about the merits of any patent or trademark 
case" and was "not about to educate [himself] in that jungle"); 
Jack Walters & Sons Corp. v. Morton Bldg., Inc., 737 F.2d 698, 
712 (7th Cir. 1984) (concluding no exceptional condition existed 
in case involving "several thousand pages" of documents when 
trial court felt it "did not have time for a long trial"). 
¶135 In light of these principles, the deficiencies in the 
Reference here are readily apparent.  When informing the parties 
of its intent to appoint a referee, the circuit court cited the 
450 cases on its docket, explaining that it did not want "to 
expend a lot of time dealing with [the parties'] discovery 
bickering" or be a "personal slave to [their] discovery 
disputes."  The court did not want to "waste precious court 
time" that it could "give to other cases."  On its face, the 
final Reference granted the referee "the full authority of the 
[c]ourt to hear and decide, subject to [c]ourt review . . . , 
any other matters assigned . . . by the [c]ourt.  All motions 
filed, whether discovery or dispositive, shall initially be 
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heard and decided by the [referee], subject to review processes" 
as described elsewhere in the Reference. 
¶136 Put plainly, because the circuit court was busy and 
did not want to deal with the parties, it gave the referee 
authority 
over 
all 
matters 
in 
the 
litigation——including 
dispositive pretrial motions.  That delegation "amounted to 
little less than an abdication of the judicial function 
depriving the parties of a trial before the court on the basic 
issues involved in the litigation."  LaBuy, 352 U.S. at 256. 
III 
¶137 It is with regard to invocation of this court's 
constitutional superintending authority that I depart most 
significantly 
from 
the 
majority 
opinion. 
 
The 
Wisconsin 
Constitution 
provides: 
"The 
supreme 
court 
shall 
have 
superintending and administrative authority over all courts."  
Wis. Const. art. VII, § 3.  This court has interpreted its 
superintending 
authority 
as 
"a 
grant 
of 
power" 
that 
is 
"unlimited in extent" and "indefinite in character," State v. 
Jerrell C.J., 2005 WI 105, ¶40, 283 Wis. 2d 145, 699 N.W.2d 110 
(quoting State v. Jennings, 2002 WI 44, ¶13, 252 Wis. 2d 228, 
647 N.W.2d 142), although the precise scope of that authority is 
not without controversy, see id., ¶146 (Prosser, J., concurring 
in part, dissenting in part). 
¶138 Superintending authority is a power that the court 
does not and should not use lightly.  Arneson v. Jezwinski, 206 
Wis. 2d 217, 226, 556 N.W.2d 721 (1996) (citing In re Phelan, 
225 Wis. 314, 321, 274 N.W. 411 (1937)).  At its core, 
No.  2016AP923-W.rgb 
 
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superintending authority "enables the court to control the 
course of ordinary litigation in the lower courts of Wisconsin."  
Id. (first citing Phelan, 225 Wis. at 320-21; then citing State 
ex rel. Fourth Nat'l Bank of Phila. v. Johnson, 103 Wis. 591, 
613, 79 N.W. 1081 (1899)).  Similar to the court's standard for 
issuance of a supervisory writ, "to invoke the superintending 
power to correct an error of the trial court, it is necessary to 
establish that an appeal from a final judgment is inadequate, 
and that grave hardship will follow a refusal to exercise the 
power."  State ex rel. Hutisford Light, Power & Mfg. Co. v. 
Grimm, 208 Wis. 366, 371, 243 N.W. 763 (1932); see also Jerrell 
C.J., 283 Wis. 2d 145, ¶145 (Prosser, J., concurring in part, 
dissenting in part) ("The purpose of this ['superintending 
control over inferior courts'] jurisdiction is to protect the 
legal rights of a litigant where the ordinary processes of 
action, appeal and review are inadequate to meet the situation, 
and where there is need for such intervention to avoid grave 
hardship 
or 
complete 
denial 
of 
rights." 
(alterations 
in 
original) (quoting John D. Wickhem, The Power of Superintending 
Control of the Wisconsin Supreme Court, 1941 Wis. L. Rev. 153, 
161-62)). 
¶139 Retrospective 
application 
of 
this 
court's 
superintending authority is not appropriate in this case because 
Newtek's delay in seeking relief from the Reference discredits 
its claim of grave harm.  By objecting to the Reference only 
after the referee decided the motion for summary judgment, 
Newtek showed its hand: it challenges the referee's authority as 
No.  2016AP923-W.rgb 
 
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a means to achieving a different outcome on the merits.  
Presumably, Newtek would not have pursued extraordinary relief 
to vacate the Reference if the referee had decided summary 
judgment and the other challenged discovery decisions in 
Newtek's favor.  Those decisions present questions reasonably 
handled by means of an ordinary appeal, and Newtek should not 
now receive extraordinary relief when it submitted to months of 
decisions by the referee, protesting only after receiving an 
adverse result. 
¶140 At the same time, the circuit court's improper 
delegation 
of 
the 
judicial 
power 
reflects 
an 
undeniable 
constitutional deficiency in the Reference.  Allowing the case 
to proceed under the Reference without alteration could lead to 
the nonsensical result of the parties completing pretrial 
proceedings under an order that this court declared partially 
unconstitutional.  To the extent any additional proceedings 
occur under the Reference, the right of all parties to an 
adjudication by a circuit court vested with the judicial power 
under the Wisconsin Constitution remains squarely at issue.  
Accordingly, prospectively vacating the order to the extent it 
contravenes the Wisconsin Constitution is an appropriate, 
limited 
application 
of 
our 
superintending 
authority 
over 
Wisconsin courts for the purpose of preserving the rights of 
these parties going forward. 
IV 
¶141 On the whole, Wisconsin's circuit courts do an 
admirable job of resolving complex disputes amidst crowded 
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dockets, and the rules of civil procedure permit them to appoint 
a referee to facilitate expeditious resolution of some of those 
cases under exceptional circumstances.  But when making a 
reference as allowed by rule, the circuit courts must heed their 
responsibilities 
under 
a 
higher 
authority, 
the 
Wisconsin 
Constitution.  By improperly delegating judicial power to the 
referee, the Reference at issue here transgressed an important 
constitutional limitation.  Although I would deny the petition 
for a supervisory writ because Newtek did not timely present it 
in a procedurally proper manner, I conclude that the Reference's 
constitutional infirmities require a limited exercise of this 
court's 
superintending 
power 
to 
prospectively 
vacate 
the 
Reference 
to 
the 
extent 
it 
denies 
these 
parties 
their 
constitutional rights.  I therefore respectfully concur in part 
and dissent in part. 
¶142 I am authorized to state that Justice DANIEL KELLY 
joins this opinion. 
 
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