Courts generally presume that a lawsuit has been filed in good faith, and a party moving for sanctions against the party who filed a lawsuit or claim must overcome this presumption to prove abuse of the judicial process. Thus, courts distinguish between (1) claims that are ultimately found to be merely groundless (and thus not sanctionable) and (2) claims that are ultimately found to be both groundless and brought in bad faith or for the purpose of harassment (and thus sanctionable). The sanctions rules generally do not require a party or its attorney to be right; they require the party or its attorney to make a reasonable inquiry into the facts and the laws related to the claims.

Contempt of court is broadly defined as disobedience to or disrespect of a court by acting in opposition to its authority. Contempt of court may be punished by the court with civil and criminal sanctions or penalties.

In New Mexico, as in other jurisdictions, there is a legal presumption that lawsuits are filed in good faith. To impose sanctions for abuse of the judicial process, the moving party must demonstrate that the opposing party's lawsuit was not only groundless but also filed in bad faith or for purposes of harassment. New Mexico's rules on sanctions do not require a party or their attorney to be correct in their legal positions; rather, they must have conducted a reasonable inquiry into the facts and applicable laws before filing claims. Regarding contempt of court, New Mexico recognizes it as an act of disobedience or disrespect towards the court's authority. Contempt can result in civil or criminal penalties, depending on the nature of the contemptuous behavior and the court's determination.