Fourth District, Division 2 Agrees that Sanctions Could Not Be Imposed For Amended Complaint, But Found Attorney Waived Any Error.
Here is an interesting nonpublished decision in the CCP § 128.7 area. Basically, the appellate court agreed with the merits of the appellant attorney’s argument, but affirmed because he had agreed to continue a sanctions motion such that any irregularities were cured in our reading of the decision.
In Armstrong v. Oberg (Green), Case No. E049346 (4th Dist., Div. 2 Nov. 17, 2010) (unpublished), attorney representing a cross-complainant was not happy with getting hit with CCP § 128.7 sanctions of $24,324 (albeit a 25% reduction of the requested sanctions). He filed an appeal, but was unsuccessful based on his own stipulated conduct.
The nub of his appeal was that the lower court erred in imposing sanctions because the demurrer to the Third Amended Cross-Complaint was sustained with leave, such that the sanctions motion had to await further developments on yet another new cross-complaint, if filed. Although finding no cases directly on point, the appellate court agreed with attorney that the norm is to allow for a new amended complaint when sustaining a demurrer with leave, so that sanctions–if awarded at all–had to be based on the amended (rather than superseded) pleading. However, here is the rub (to the nub). Attorney stipulated to continue the sanctions motion for around 60 days after resolution of the demurrer on the Fourth Amended Cross-Complaint, meaning he could not complain that no new sanctions motion had to be filed. (QUERY–Did this stipulation still require new compliance with the safe harbor time period for the next amended cross-complaint? We will not opine, because the motion was set over for way longer–60 days down the line.) Anyway, the sanctions award was affirmed–given the stipulation, given there was no abuse of discretion, and given the 25% reduction in amount from requested sanctions.