Nowadays, the term "L" refers to both a blunt (marijuana cigar) as well as L-Plate joints.
The evolution of the term either came from blunts rolled with El Producto cigars, or due to the size of an L-Plate joint being larger than the average joint and possibly similar to a blunt.
Dude #2: "Aight."
(Also, when you hear rap songs where people are smoking "Ls", they are almost certainly referring to blunts rather than L-Plate joints, unless they specifically mention that they are smoking joints or spliffs at the same time.)
Girl 2: "I hate Light for killing him!"
Girls 1 & 2: "The bastard..."
Cathy responds, "And Santa is also the word for Saint in many languages. And since the figure of Santa Claus is based off SAINT Nicholas, its not surprising. So nice try, but you failed."
In that case, Sarah caught an L because she tried to prove an invalid point.