LESLIE W. RINGELSTEIN v. RICHARD SCHMIDT

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-03409-12T3

LESLIE W. RINGELSTEIN

f/k/a SCHMIDT,

Plaintiff-Appellant/

Cross-Respondent,

v.

RICHARD SCHMIDT,

Defendant-Respondent/

Cross-Appellant.

_____________________________________

July 7, 2015

Argued February 25, 2015 Decided

Before Judges Ashrafi and Kennedy.

On appeal from Superior Court of New Jersey, Chancery Division, Family Part, Bergen County, Docket No. FM-02-2704-09.

Dale E. Console argued the cause for appellant/cross-respondent.

Raymond Barto argued the cause for respondent/cross-appellant (Kaps & Barto, attorneys; Mr. Barto, on the brief).

PER CURIAM

This is an appeal and a cross-appeal challenging the Family Part's judgment of equitable distribution following a trial. We affirm much of the judgment but remand for further consideration of two of the many items that were disputed during the trial.

Children and spousal support were not involved in the case; the only disputes were about the division of assets, mostly real estate. Still, the trial conducted before Judge Bonnie Mizdol required sixteen court days over a time span of more than a year. After completion of testimony and the parties' submission of proposed findings and conclusions, the judge issued a comprehensive sixty-three page decision dated June 8, 2012.

Both parties were dissatisfied and filed motions for reconsideration, one raising nine and the other ten items that the judge was asked to reconsider and reallocate. An intervening dispute about use of certain emails delayed the motions for reconsideration. On February 26, 2013, Judge Mizdol issued another written decision and an order by which she made some minor adjustments in the final judgment but otherwise denied the motions.

On appeal, plaintiff-wife Leslie Ringelstein contends the judge erred in excluding two properties from the marital assets subject to equitable distribution and also in charging her with liability for half the unsecured debt that defendant-husband Richard Schmidt owed to his mother. On the cross-appeal, Schmidt contends the court erred in requiring him to reimburse $50,000 in attorney's fees to Ringelstein and in failing to order her to bear half the carrying costs of marital properties.

I.

Our summary of the facts provides the background of the marriage and of the parties' work history. It then details the real estate and the debts that were the subjects of the equitable distribution trial.

The parties began living together in 1982 and married in 1987. They had no children. They separated in 2007, and the divorce action was filed in 2009.

Ringelstein worked as a nurse throughout the twenty-two year marriage. At the time of the divorce, she was earning about $90,000 per year. Schmidt was self-employed in real estate acquisition, development, and management. From 1985 to 2000, he conducted his business activities with a partner through an entity named Sunrise Developers.

In 1994, Schmidt was diagnosed with Parkinson's disease. By the late 1990s, his illness was inhibiting his ability to work. His mother, Joan Schmidt, began assisting him in maintaining his business records. In 2000, Schmidt ended his relationship with Sunrise Developers and pursued a solo land development and property acquisition business at a less demanding pace and with the help of his mother. By 2004, the mother had full responsibility for handling his bank accounts and bills, and she maintained all his files and records. In 2011, Schmidt was adjudicated disabled and began receiving Social Security benefits. At the time of the trial, his disability income was $1,509 per month.

Throughout their pre-marital cohabitation and their marriage, the couple maintained separate bank and credit card accounts, and they followed a structured financial arrangement for their personal and business expenses. Ringelstein was responsible for clothing, groceries, gifts, entertainment, and most vacation expenses of the couple. Also, her employment provided health insurance coverage for both. Schmidt was responsible for the couple's mortgage loans, real estate taxes, homeowners' insurance, maintenance, repair, and utility costs associated with all the real estate, and for automobile insurance and maintenance expenses. He did not use personal bank accounts, paying these expenses through his business accounts. However, Ringelstein also contributed toward the expenses of one of the marital homes.

Several parcels of real estate, two of which the trial court determined were pre-martial and exempt from equitable distribution, are the subject of these appeals.

A. Marital Homes Eastview and Palisades

One of the two properties that Judge Mizdol determined was a pre-marital asset owned by Schmidt and not subject to equitable distribution was the parties' first and last marital home, located on Eastview Terrace in Demarest (Eastview).

In 1977, five years before the cohabitation and ten years before the marriage, Schmidt and his father purchased the five-unit Eastview residential building for $90,000. In October 1982, Ringelstein and Schmidt began living together in one of the units. In 1984, Schmidt bought out his father's interest in Eastview for half the property's appraised value of $145,000. He funded the buy-out of his father by assuming the first mortgage and taking a second mortgage loan of $50,000 from a financial institution.

In 1988, after the parties married, they started to look for property to build a custom, one-family "dream home." They selected an unimproved parcel in Palisades, New York (Palisades). To fund the $250,000 purchase price of the lot, Schmidt refinanced two properties, Eastview and a parcel he owned on Third Avenue in Westwood, New Jersey (Westwood). The Eastview refinancing required that Ringelstein execute a quitclaim deed transferring all her rights and interest in Eastview to Schmidt. Schmidt netted $169,421.54 from the refinancing of Eastview, which he used to fund a portion of the purchase price for the Palisades property.

In 1989, construction began on the Palisades home. Schmidt took out a $400,000 construction loan secured by a mortgage on the property, and he was also required to "wrap mortgages against" his Eastview and Westwood properties as additional security. The Palisades home was built, and the parties resided there from 1990 to 2001. During their occupancy, Ringelstein contributed $1,800 to $1,900 per month to the mortgage, real estate taxes, homeowners' insurance, and other expenses of the home.

In 1999, the parties decided to move back to Eastview. They would first raze and rebuild the existing five-unit dwelling and then take up residence in one of the rebuilt units. Selling the Palisades property would also enable them to buy a sailboat in pursuit of their desire to travel.

Schmidt borrowed approximately $680,000 from his mother to fund the rebuilding of Eastview. Ringelstein testified she did not know the amount borrowed but Schmidt was to repay the loan by providing to his mother rent-free residence for life in one of the new Eastview units. Eastview was rebuilt, and the parties and the mother moved in. After the parties' separation in 2007, Schmidt continued to live at Eastview.

The Palisades property was sold in 2001 for $990,000, providing net proceeds of $432,220. Schmidt used $116,683 to purchase a sailboat, which was later sold. The proceeds from the sailboat are to be split as part of the equitable distribution and are not in dispute. The remainder of the proceeds from the Palisades property, $315,537, were deposited into Schmidt's business account.

After the sale of Palisades, Schmidt paid his mother $279,555 towards the $680,000 Eastview loan. He and his mother agreed that the balance of $372,440, would be repaid at the rate of $2,000 per month over thirty years, with an interest rate of five percent, the payments to be in the form of credits against the mother's rent charges for the unit she occupied at Eastview.

In June 2010, after the divorce action was filed, Schmidt took out a $700,000 mortgage on Eastview, which enabled him to complete the purchase of another property located on Piermont Road in Closter. As we will discuss, the court determined that the Piermont property and the net proceeds from the sale of Palisades were subject to equitable distribution, but not Eastview itself or the enhancement in its value during the period of the marriage.

At the trial, the competing appraisal experts valued Eastview at $1,100,000 and $1,365,000. Ringelstein claimed that any pre-marital interest that Schmidt had in Eastview was minimal, and the property was subject to equitable distribution. Schmidt asserted that Ringelstein was not entitled to share in Eastview because its increased value was due solely to inflation and other economic forces, or to his efforts alone.

Judge Mizdol found that Eastview was pre-marital property and thus exempt from equitable distribution. Because of the exemption, Schmidt was responsible for the entire mortgage loan on the property. With respect to Ringelstein's interest in the parties' marital homes, the judge credited her with $157,768.61, representing one half the net proceeds from the sale of the Palisades property and with pay-down during the marriage of mortgage loans on Eastview.

B. Third Avenue, Westwood, New Jersey

In December 1985, before the marriage, Schmidt purchased the Westwood property for $250,000. He funded the purchase with a $30,000 down payment from his pre-marital savings and two mortgage loans in his name alone. The property contained a two-story, mixed-use structure with two storefronts on the first floor and three residential units on the second floor.

In 1988, Schmidt refinanced Westwood to help fund the purchase of the Palisades property. He obtained a bank loan of $250,000, of which $167,116 was used to pay off the existing first mortgage on Westwood. The net proceeds of $79,836 were used towards the purchase of Palisades.

On January 1, 2006, a fire destroyed the Westwood building. After the fire, Schmidt spent more than $100,000 in legal fees contesting the municipality's denial of his zoning application to rebuild the non-conforming structure as before. On July 1, 2009, about two weeks after Ringelstein filed her divorce complaint, the municipality granted Schmidt's application to rebuild the Westwood building. The construction was not finished at the time of the divorce. Upon completion, Westwood would resume producing income for Schmidt.

At the time of the divorce complaint, there were two commercial mortgages on the property, with a combined balance of $130,000. In addition, Schmidt claimed he owed his prior Sunrise Developers partner about $125,000 for the construction work done on the property. The land without the rebuilt structure was appraised at $265,000. The experts at the trial disputed the value of the property as improved, their appraisals ranging from a low of $560,000 with another $340,000 needed to complete the construction, to an "as is" partially-completed valuation of $960,000, and to the estimated high value of $1,180,000 at completion of the construction.

Judge Mizdol concluded that Westwood was a pre-marital, exempt asset that Schmidt could retain. Ringelstein was entitled to the principal pay-down on the mortgages through the date of the complaint, and Schmidt was solely responsible for any loans or debts still owed on the property. On appeal, Ringelstein does not challenge the exempt status of Westwood, but she uses the judge's treatment of her equitable distribution rights in Westwood to argue that other properties were treated inconsistently.

C. Lenox Avenue, Congers, New York

The second property that Ringelstein contends should have been deemed subject to equitable distribution was located on Lenox Avenue in Congers, New York (Congers). Schmidt purchased the multi-family home in 1996 from his brother for $180,000. He borrowed the full purchase price from his mother. In the ensuing years, he alone managed the rental units of the Congers property.

Schmidt sold Congers in February 2009, after the parties' separation but before the divorce complaint was filed. He netted $437,461 from the sale. From the proceeds, he repaid his mother $180,000 plus accumulated interest of $41,800. He also paid $32,302 in attorney's fees to David Watkins, Esquire. Of the attorney's fees, $1,500 was for work on the Congers closing and the balance for services Watkins had provided in connection with the Westwood zoning dispute. The remainder of the Congers proceeds was deposited in Schmidt's business account and applied to other properties.

In her original June 8, 2012 decision, Judge Mizdol made no findings regarding distribution of the Congers proceeds, apparently because Congers was not an asset held by either party at the time of the divorce and Ringelstein had not asked through her proposed findings of fact and conclusions of law to include the proceeds in the equitable distribution judgment. However, Ringelstein's motion for reconsideration disputed the omission of the Congers proceeds from equitable distribution.

On the motion for reconsideration, the judge found that Congers was acquired with non-marital funds, it was not actively developed, and any increase in its value was passive and due solely to market forces. Therefore, Ringelstein was not entitled to share in the Congers proceeds.

D. Wigwam Park Road, East Stroudsburg, Pennsylvania

In 1995, Schmidt borrowed $25,000 from his mother to lend to a friend named Goldman. As security for the loan, Schmidt received from Goldman and recorded a deed to a parcel of land on Wigwam Park Road in East Stroudsburg, Pennsylvania (Wigwam). Goldman failed to repay the loan, and so, Schmidt still retained title to Wigwam at the time of the divorce.

With his mother's consent, Schmidt had not made any payments on the $25,000 loan he had taken from her. During the final days of the trial, Wigwam was listed for sale by consent of the parties and by order of the court at a price of $69,900. The property remained unsold at the time of these appeals.

Judge Mizdol concluded that Wigwam was marital property subject to equitable distribution. Upon its sale, Schmidt's mother is to be paid $25,000 from the proceeds. The judge rejected any addition of interest on the mother's loan because, over the years since 1995, the mother had not sought to collect interest or to enforce the informal loan agreement.

On his cross-appeal, Schmidt claims that Judge Mizdol erred in omitting a requirement in the final judgment that Ringelstein be responsible for half the carrying costs of Wigman until it is sold and the proceeds are divided between the parties.

E. Durie Avenue, Closter, New Jersey

Schmidt makes the same argument regarding another marital property that the judge ordered to be sold and the net proceeds distributed equally between the parties. He contends the carrying costs for commercial property located on Durie Avenue in Closter (Durie) should be borne by both parties.

Schmidt entered into a contract to purchase Durie in September 2003 for $326,000. The property contains an obsolete one-story metal modular home constructed for returning servicemen after World War II. A historical marker posted on the property states that the home is listed in the State and National Registers of Historical Places, but no one at the trial knew by whom and by what authority the marker was installed. Before Schmidt closed on the purchase of Durie, the local planning board denied the seller's application to subdivide the property.

In January 2006, the seller served Schmidt with a "time of the essence" closing notice, and Schmidt was forced to borrow funds from his mother on extremely short notice to complete the purchase. He closed on Durie in February 2006. Schmidt and his mother had no written loan agreement or repayment schedule for her funding of the Durie purchase, and Schmidt never made any payments to her on the loan. At the trial, Ringelstein disputed the loan or any agreement to repay it.

The experts' appraisals of Durie differed significantly. Schmidt's expert valued the property at $265,000. His appraisal was based on the assumption that the historical designation restricted the property's potential development. Ringelstein's expert found no historic preservation easements that would restrict development and valued the property at $500,000. Judge Mizdol credited the testimony of Ringelstein's expert. The judge gave Schmidt the option to buy out Ringelstein's interest for $85,000, representing the appraised value minus the $329,000 loan from Schmidt's mother. If Schmidt did not exercise this option within 120 days, the property would be listed for sale and the net proceeds divided equally. Schmidt did not exercise the option within the deadline.

F. Piermont Road, Closter, New Jersey

In November 2004, Schmidt entered into a contract with an elderly acquaintance named Foss to purchase property located on Piermont Road in Closter (Piermont) for $900,000. The property had been used as a gas station for almost fifty years, but the underground fuel tanks had been removed, and it was now a one- story garage and related office space used for auto repair work.

Because of Schmidt's personal friendship with Foss, the purchase contract contained several unique terms. Foss financed $650,000 of the purchase price at six percent interest for six years, payments of interest only to be paid during the six years. Schmidt was also required to manage the property and apply the rental income to carrying charges to service Foss's two mortgages. In addition, if the rental income was insufficient to meet the carrying costs, Schmidt was to advance the deficiency.

At some point, a guardian appointed to manage Foss's affairs sued Schmidt to declare the 2004 purchase and sale contract null and void. The contract was later deemed enforceable, and Schmidt was awarded a credit of $352,244 against the $900,000 purchase price. Schmidt closed on the purchase of Piermont in June 2010, one year after the divorce complaint was filed. The balance needed for the purchase, $584,782, was funded by Schmidt's refinancing of Eastview.

At the divorce trial, Piermont was appraised at $1,404,000, as of October 2010. Judge Mizdol determined it was marital property subject to equitable distribution. She granted Schmidt the option to buy out plaintiff's interest for $352,187 representing half the appraised value of $1,404,374, minus the new $700,000 Eastview mortgage used to fund the purchase.

Following the court's decision and the entry of the divorce judgment, Ringelstein found emails revealing negotiations Schmidt had engaged in to sell Piermont dating back to 2009 and continuing to after the trial. The offers for Piermont ranged from $1.8 million to $3.75 million. Schmidt applied for an order to show cause to restrain the use of the emails in the motions for reconsideration. The issue was submitted for resolution to a different judge, who ultimately found the emails were admissible evidence.

On the motions for reconsideration, Judge Mizdol found that Schmidt had acted in bad faith during the divorce trial by concealing evidence of prospective buyers for Piermont and its market value. She found the concealment may have affected the experts' valuation and compromised her ruling with respect to the value of Piermont. Therefore, Judge Mizdol revoked Schmidt's option to purchase Piermont and ordered that it be listed for sale. She determined the mortgage indebtedness on the property to be $584,782 and directed that the parties share equally in the net proceeds of the sale. Schmidt would pay the carrying costs of the property, but Ringelstein would be required to reimburse half the net carrying costs from the date of the divorce complaint through the date of sale.

G. Non-Mortgage Loans from Schmidt's Mother

Judge Mizdol determined that Schmidt had borrowed money from his mother during the marriage for various reasons besides funding the purchase or rebuilding of specific properties, and that the parties had used the borrowed money to pay some of their marital expenses. The judge referred to Schmidt's mother as a "revolving line of credit" that advantageously avoided the couple's turning to traditional sources to borrow money.

The judge found that the mother's outstanding unsecured loan balances before the divorce complaint constituted joint marital debt totaling $228,304. She concluded that each party was responsible for half, $114,152. The judge denied the requests of Schmidt and his mother to allow interest on the loans.

Ringelstein contends the balance due on the mother's loans includes funds used to obtain the eventual approval for reconstruction of the Westwood property after the 2006 fire, and since that property is exempt from equitable distribution, she should not have been charged with liability for half the debts owed to the mother.

II.

"The goal of equitable distribution . . . is to effect a fair and just division of marital assets." Steneken v. Steneken, 367 N.J. Super.427, 434 (App. Div. 2004), aff'd in part, modified in part, 183 N.J.290 (2005). In pursuit of that goal, the trial court must consider the factors enumerated in N.J.S.A.2A:34-23.1, which include the length of the marriage, the parties' standard of living, the economic circumstances of each party after the divorce, the income and earning capacity of each party, and the present value of the property to be divided.

Appellate review of division of marital assets is limited to determining whether the trial court abused its broad discretionary authority. La Sala v. La Sala, 335 N.J. Super. 1, 6 (App. Div. 2000), certif. denied, 167 N.J. 630 (2001); see also Valentino v. Valentino, 309 N.J. Super. 334, 339 (App. Div. 1998) (appellate court reviews whether the trial court's decision on equitable distribution is clearly unfair or unjust or contrary to the evidence); Wadlow v. Wadlow, 200 N.J. Super. 372, 377 (App. Div. 1985) (trial court has "broad authority" in dividing marital property). An award of equitable distribution will be affirmed "as long as the trial court could reasonably have reached its result from the evidence presented, and the award is not distorted by legal or factual mistake." La Sala, supra, 335 N.J. Super. at 6.

Our Supreme Court has set forth a three-step process for trial courts to follow in equitably distributing marital assets. The court "must first decide what specific property of each spouse is eligible for distribution. Secondly, [the court] must determine its value for purposes of such distribution. Thirdly, [it] must decide how such allocation can most equitably be made." Rothman v. Rothman, 65 N.J. 219, 232 (1974). The process of equitable distribution is "not simply a matter of mechanical division of marital assets. . . . The word 'equitable' itself implies the weighing of the many considerations and circumstances that are presented in each case." Stout v. Stout, 155 N.J. Super. 196, 205 (App. Div. 1977) (citations omitted).

Here, the overall equitable distribution judgment was fair and balanced. As our recitation of the facts reveals, Judge Mizdol carefully considered the complex and interwoven financing of the various parcels of real estate, and she reached an impartial and even-handed resolution of the rights of the parties to the many properties and to the proceeds derived from the properties. The mother's role as a private banker for Schmidt's business ventures and for the parties' personal expenses added an unusual and complicating twist. The ultimate result of the judgment is that each party was left with substantial assets. Their continuing disputes in these appeals must nevertheless be addressed.

A. Congers

In her June 8, 2012 decision, Judge Mizdol recited the facts pertaining to the Congers property but did not make any findings with regard to the distribution of the proceeds from its sale in 2009. Ringelstein's failure to include the Congers proceeds as matrimonial property that she sought to have distributed no doubt contributed to their omission. But because Ringelstein raised the issue on her motion for reconsideration, we will treat her arguments as preserved for purposes of appeal.

On reconsideration, Judge Mizdol found Congers

although acquired during the marriage, was acquired with non-marital monies, specifically a loan from [the] [m]other, Joan Schmidt, in the exact amount of the purchase price. This parcel of property was not actively developed, but was passive, with any increase in value being attributable solely to market forces. Therefore, the non-titled spouse is not entitled to share in that portion of the enhancement in value due solely to inflation or other economic forces that the non-titled spouse did not contribute to in any way.

Ringelstein argues the judge's conclusion was legally incorrect and also inconsistent with the judge's findings on two similarly situated properties, Durie and Wigwam. She cites Scavone v. Scavone, 230 N.J. Super. 482, 493 (Ch. Div. 1988), aff d, 243 N.J. Super. 134 (App. Div. 1990), in support of her argument that a passive asset acquired during the marriage but titled in only one party's name is nevertheless marital property subject to equitable distribution. But in Scavone, neither the trial court nor the appellate court was required to decide whether the contested asset in that case was in fact marital property. The parties there agreed that it was. Id. at 485; Scavone, supra, 243 N.J. Super. at 136.

Schmidt argued in this case, and Judge Mizdol found, that Congers was not marital property because it was acquired entirely with non-marital assets and because Ringelstein had nothing to do with the enhancement of its value while Schmidt owned and managed it. We find no error in those findings and conclusions. Congers did not become a marital asset simply because it was acquired during the marriage. The judge could reasonably conclude that Congers was exempt from equitable distribution because it was remote from any involvement or contribution by Ringelstein.

B. Eastview

Ringelstein argues that Judge Mizdol erred in excluding Eastview from equitable distribution. The judge explained that, because Eastview was acquired before the marriage without any involvement by Ringelstein, Schmidt met his initial burden of establishing exemption from equitable distribution in accordance with Painter v. Painter, 65 N.J. 196, 214 (1974). The judge added that the parties' separate financial arrangements during their marriage further supported Schmidt's claim that the property was exempt.

Citing Sculler v. Sculler, 348 N.J. Super. 374, 381 (Ch. Div. 2001), the judge found that Ringelstein did not meet her burden of proving how much Eastview had increased in value because of the "shared enterprise" or "joint undertaking" of the marriage. Rothman, supra, 65 N.J. at 229. Ringelstein could not show she was entitled to share in any such unproven incremental increase.

The judge found, however, that Ringelstein was entitled to a credit for marital money that was used to repay the loans taken on Eastview. She credited Ringelstein with half the proceeds from the sale of Palisades used to fund the rebuilding of Eastview, half the mortgage pay-down during the marriage, and a reduction in the principal balance of a refinancing of the property. On the motions for reconsideration, the judge recalculated the division of proceeds from the Palisades sale and the pay-down of the Eastview mortgage loans. Otherwise, the judge declined to include the increased value of Eastview as a marital asset.

On appeal, Ringelstein claims she contributed all her earned income to the marriage, as well as to the cohabitation before the marriage, and her contributions entitled her to a share of the Eastview marital home. She argues she "had an equitable interest in the property that goes beyond mere pay-down of the mortgage by virtue of substantial pecuniary and non-pecuniary contributions to the property."

"[T]he burden of establishing immunity from distribution of a particular marital asset or portion of an asset rests upon the spouse who asserts it." Pacifico v. Pacifico, 190 N.J. 258, 269 (2007). "[A]ny property owned by a husband or wife at the time of marriage will remain the separate property of such spouse and in the event of divorce will not qualify as an asset eligible for distribution." Painter, supra, 65 N.J. at 214; accord Tannen v. Tannen, 416 N.J. Super. 248, 281 (App. Div. 2010), aff'd o.b., 208 N.J. 409 (2011); Valentino, supra, 309 N.J. Super. at 338. The titled owner's rights to such pre-marital property include any incremental increase in the value of the property. Painter, supra, 65 N.J. at 214.

Here, sufficient credible evidence supported the judge's finding that Eastview and any increase in its value were non-marital assets. The court did not abuse its discretion in exempting Eastview as a marital asset while awarding to Ringelstein credit for the pay-down of debt on the property and half the net proceeds from the sale of Palisades. See Sauro v. Sauro, 425 N.J. Super. 555, 573 (App. Div. 2012) (abuse of discretion standard of review), certif. denied, 213 N.J. 389 (2013).

"Family Part judges are frequently called upon to make difficult and sensitive decisions . . . . Because of their special expertise in family matters, we do not second-guess their findings and the exercise of their sound discretion." Hand v. Hand, 391 N.J. Super. 102, 111 (App. Div. 2007) (citing Cesare v. Cesare, 154 N.J. 394, 413 (1998)). Looking broadly at the judgment of equitable distribution in this case, which went far beyond a single marital home or one major asset to be divided between the parties, we find no abuse of discretion in the judge's findings and conclusions as to Eastview.

C. Loans from the Mother

Next, Ringelstein argues the judge erred in ordering her to pay half the unsecured loans due to Schmidt's mother. In her June 8, 2012 decision, Judge Mizdol found that Schmidt owed "non-mortgage debt" to his mother used to pay marital expenses and Ringelstein was liable for half the balance of $228,304 at the time of the divorce. The judge found that Schmidt

used his [m]other as a hard money lender. This was a substantial benefit to him and [Ringelstein] as well; [Schmidt] avoided the need to qualify for financing, avoided point fees which would have accrued to the lending institution, and avoided other closing costs and legal fees. [Schmidt's] mother was and continues to be his revolving line of credit.

As the judge stated, the "evidence demonstrates that loans given by [the mother] were re-paid by [Schmidt] when real estate was sold." Thus, the loans did not have fixed payment schedules or, one might add, much risk of default or contested enforcement.

Ringelstein does not dispute her liability for some amount owed to Schmidt's mother. Rather, she contends the judge "failed to factor out the portion of those loans that relate to [Schmidt's] premarital property in Westwood which [the judge] found to be exempt." Schmidt does not respond convincingly to this argument. He contends Ringelstein had an opportunity at the trial to present an accounting of the disposition of the unsecured loans and to "trace the use of the loan funds . . . dedicated to exempt property" but failed to do so.

Generally, we can decline to consider issues that an appellant failed to present in the trial court. State v. Robinson, 200 N.J. 1, 20-22 (2009); State v. Arthur, 184 N.J. 307, 327 (2005); Nieder v. Royal Indem. Ins. Co., 62 N.J. 229, 234 (1973). At times, however, we do not follow that rule where an issue was raised in the trial court but based on a different theory from the one advanced in the appellate court. See Regan v. City of New Brunswick, 305 N.J. Super. 342, 355 (App. Div. 1997); Docteroff v. Barra Corp.of Am., 282 N.J. Super. 230, 237 (App. Div. 1995).

Here, Ringelstein challenged both the exemption of certain properties from equitable distribution and the reliability of Schmidt's claims of the amounts owed to his mother. Those challenges were sufficient to preserve the issue of her liability for unsecured debts owed to the mother. While Judge Mizdol found that the mother was a credible witness and provided a detailed summary of all non-mortgage loans, she found "no precise explanation as to what [Schmidt] used these funds for."

In her brief on appeal, Ringelstein argues the mother's "own accounting" indicates the amount of her unsecured loans used to finance the purchase of the Piermont property, which was determined to be a marital asset. She argues "the balance went to 'other business expenses'" and that summaries of Schmidt's bank statements show "that many of the loan deposits were spent entirely on expenses relating to the Westwood property, including legal fees, mortgage payments and other expenses."

We have not found in the judge's decisions, or otherwise in the record, a specific determination of whether portions of the unsecured loans where used to fund the rebuilding of Westwood. A limited remand is necessary for the trial court to make additional findings regarding any use of the loan funds for Westwood, an exempt asset. If in fact some portion of the $228,304 can be attributed to Westwood, that amount should be deducted from the unsecured marital debt, and Ringelstein's liability for the mother's loans should be adjusted.

D. Attorney's Fees

On the cross-appeal, Schmidt argues the judge erred in awarding Ringelstein reimbursement of $50,000 in attorney's fees for the divorce litigation.

Rule 5:3-5(c) sets forth nine factors the court must consider in awarding attorney's fees. The judge discussed the nine factors in her written decision of June 8, 2012, providing details of her findings in eight pages of the decision. Schmidt's argument on appeal can be distilled to an emphasis on one of the nine factors, that both parties were left with sufficient assets with which to pay their own legal fees. Thus, he contends, there was no justification for transferring a portion of Ringelstein's legal expenses to him. See Pascarella v. Pascarella, 165 N.J. Super. 558, 565 (App. Div. 1979). We disagree with that argument.

"[T]he award of counsel fees and costs in a matrimonial action rests in the discretion of the trial court." Guglielmo v. Guglielmo, 253 N.J. Super. 531, 544-45 (App. Div. 1992); accord Eaton v. Grau, 368 N.J. Super. 215, 225 (App. Div. 2004). "We will disturb a trial court's determination on counsel fees only on the 'rarest occasion,' and then only because of clear abuse of discretion." Strahan v. Strahan, 402 N.J. Super. 298, 317 (App. Div. 2008).

Judge Mizdol found there was yet a "disparity" between the parties' financial circumstances after consideration of the equitable distribution and the value of Schmidt's exempt properties. We find no abuse of discretion in the judge's taking that disparity into account in requiring Schmidt to reimburse less than thirty percent of the litigation expenses Ringelstein had incurred.

We also find sufficient justification for the award after the judge considered the post-trial motions for reconsideration. The judge found that Schmidt had acted in bad faith when he withheld information relevant to the appraisal of the Piermont property. See N.J.S.A. 2A:34-23; Kothari v. Kothari, 255 N.J. Super. 500, 513 (App. Div. 1992).

We affirm the award of attorney's fees and litigation expenses to Ringelstein for the reasons stated in Judge Mizdol's written decisions.

E. Carrying Costs

Finally, Schmidt seeks a remand for the trial court to clarify and correct its decision with respect to the carrying costs for the Durie and Wigwam properties. In the alternative, he asks that we exercise original jurisdiction to rule that the carrying costs must be assessed equally to both parties at the time those properties are sold and the proceeds distributed. See R. 2:10-5; Accardi v. Accardi, 369 N.J. Super. 75, 91-92 (App. Div. 2004).

Judge Mizdol required Ringelstein to reimburse Schmidt for the carrying costs of Piermont from the time of the divorce complaint until the property is sold, but she did not give a similar directive with respect to carrying costs for Durie and Wigwam, which are also to be sold and the proceeds divided. We do not know whether the absence of an express provision on carrying costs was intentional or inadvertent. We decline to exercise original jurisdiction to resolve the issue. See Tomaino v. Burman, 364 N.J. Super. 224, 234-35 (App. Div. 2003) (Appellate courts may exercise original jurisdiction but "only with great frugality . . . ."), certif. denied, 179 N.J. 310 (2004). A remand is necessary to determine whether the parties should share in the carrying costs of Durie and Wigwam.

III.

In closing, the trial judge resolved many issues in a lengthy divorce trial that revealed unusual and complicated financial relationships and transactions. We have affirmed the majority of the judge's rulings. The remand pertains to a single matter raised by each side, liability for the unsecured loans from the mother and for the carrying costs of two marital properties until they are sold. The decision on those two issues may ultimately be balanced in dollar amounts. The parties would be well-advised to resolve the remaining issues without incurring further litigation expenses.

Affirmed in part, and remanded in part for further proceedings in conformity with this decision. We do not retain jurisdiction.