In Diepenbrock v. Brown, 2012 DJDAR 11582 (2012), the California Court of Appeal for the First Appellate District decided an interesting sanctions case under Code of Civil Procedure Section 2025.420(d). The court concluded that sanctions were not properly awarded because there was conflicting legal authority on a significant issue in the case, and that the trial court erred in granting sanctions for that reason alone.

The plaintiff was riding a bicycle when she was injured by a vehicle driven by the defendant. At the time of the accident, the defendant was impaired, allegedly under the influence of prescription drugs.

When the defendant was convicted of felony driving under the influence, the plaintiff amended her complaint to add a claim for attorney fees. After granting the amendment, the court permitted the plaintiff to pursue discovery on financial issues.

To that end, the plaintiff sought to take the deposition of the defendant’s husband.  The husband refused to answer numerous financial questions and imposed the “marital privilege” as a bar. The plaintiff filed a motion to compel and sought sanctions. The husband moved for a protective order and sought sanctions in turn. The trial court granted the husband’s motion and granted significant sanctions against the plaintiff. The plaintiff contended that because a split of authority existed on the marital privilege issue, sanctions were improper.

The court of appeal reversed the trial court’s decision. The court of appeal stated that under Code of Civil Procedure Section 2025.420(d), the statute allows monetary sanctions to be imposed against any party who unsuccessfully opposes a motion for a protective order. There is a safe haven, however, if the court finds that the sanctioned party acted with “substantial justification.” The court of appeal defined “substantial justification” as conduct with colorable basis in both law and fact. The court noted that married persons are precluded from asserting the marital privilege where one spouse is defending for the “immediate benefit” of his spouse or of both spouses jointly. Here, conflicting authority existed as to how the “immediate benefit” test should be applied in cases involving community property.

The court noted that the plaintiff’s counsel cited legal authority in support of his position and distinguished the defendant’s case law. As such, the court concluded that counsel reasonably argued on an area of law where there is a current split of authority. Sanctions were not appropriately awarded for that reason.