NOT PRECEDENTIAL

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

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No. 10-3496

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BARBARA PENCE,

Appellant

v.

MAYOR AND TOWNSHIP COMMITTEE

OF BERNARDS TOWNSHIP

_______________

On Appeal from the United States District Court

for the District of New Jersey

(D.C. Civil No. 3-08-cv-02312)

District Judge: Hon. Freda L. Wolfson

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Submitted Pursuant to Third Circuit LAR 34.1(a)

October 4, 2011

BEFORE: MC KEE, Chief Judge, FUENTES and COWEN , Circuit Judges

(Filed: November 2, 2011)

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OPINION

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COWEN, Circuit Judge.

Barbara Pence (“Pence”) appeals from orders of the District Court granting the 
2

Mayor and Township Committee of Bernards (collectively “ the Township”) summary 

judgment and denying Pence’s Motion for Relief from Judgment or Order Pursuant to 

Fed. R. Civ. P. 60(b)(1).

1

In November 2003, approximately one year prior to Pence’s resignation, the 

Township repealed its personnel policies’ ordinance and replaced it with an Employee 

Handbook. It is modified and renewed each year by resolution. The handbook contains a 

Retirement Plan provision regarding the payment of accumulated but unused sick leave at 

retirement. According to the provision, when an employee retires as defined by PERS, 

the “Township will make a cash payment of 50% of all sick leave earned . . . less the 

 We will affirm.

I.

Pence was employed by the Township as the Township Administrator from June 

1994 until her resignation in December 2004. As required by state law, N.J.S.A. 

40A:15A-7, Pence was enrolled in the New Jersey Public Employee Retirement System 

(PERS). Members of PERS who have completed 10 years of public employment and 

separate from service before reaching service retirement age can elect to receive a 

deferred retirement allowance beginning at the retirement age. N.J.S.A. 43:15A-38. In 

Pence’s case, the retirement age is 60 years; in December 2004, at the time of Pence’s 

resignation, Pence was age 53. Because Pence had 10 years of service, she would be 

eligible for the deferred retirement allowance when she reached age 60. 

 1 Pence relied on Local Rule 7.1, Fed. R. Civ. P. 15 and Fed. R. Civ. P. 60(b) to make her motion to reconsider and 

to amend the Complaint. The District Court ultimately treated the motion as one made pursuant to Fed. R. Civ. P. 

60(b). On appeal, both parties treat the motion to reconsider and to amend the Complaint as one pursuant to Fed. R. 

Civ. P. 60(b). 
3

amount taken . . . that the employee may have received at the time of hire.” 

At the time of resignation in December 2004, Township Human Resources 

informed Pence that she would be entitled to a payment for her unused sick leave when 

she turned 60 and “file[s] for retirement under the NJ State Pension Plan.” (Exh. JA115.) 

However, in July 2006, the Township notified Pence that she was ineligible for the 

payment for unused sick leave because she was not eligible for retirement when she 

separated from her employment in December 2004. Pence responded through her 

attorney that she is entitled to payment for unused sick leave. 

Pence filed the instant action alleging that the Township deprived her of 

constitutional rights and due process of law in violation of the Fourteenth Amendment by 

denying payment. In their Motion for Summary Judgment, the Township argued that 

Pence’s claim fails as a matter of law because she does not have a protectable property 

interest under the Fourteenth Amendment. The District Court granted the Township’s 

motion, holding that the payment of unused sick leave is not a protectable property 

interest for due process purposes.

Pence filed a Motion for Reconsideration because her counsel failed to amend the 

Complaint to include a state law claim for breach of contract. After holding that Pence’s 

reliance on Local Rule 7.1(i) and Fed. R. Civ. P. 15 was misplaced, the District Court 

analyzed the failure to amend the Complaint pursuant to Fed. R. Civ. P. 60(b)(1). The 

District Court analyzed whether the proffered reasons for failing to file an amended 

Complaint after leave to amend was granted by the Magistrate Judge constituted 
4

“excusable neglect.” It denied the motion, holding that “[t]he excuse that counsel forgot, 

or that the [Magistrate Judge’s] Order was clipped to another document, is [] not a reason 

. . . to reopen this case.” We have jurisdiction over this appeal pursuant to 28 U.S.C. 

§ 1291. 

II.

We first review the District Court’s order granting summary judgment in favor of 

the Township. Our review of summary judgment is plenary. Lamont v. New Jersey, 637 

F.3d 177, 181 (3d Cir. 2011). Summary judgment is proper if the moving party “shows 

there is no genuine dispute as to any material fact and the movant is entitled to judgment 

as a matter of law.” Fed. R. Civ. P. 56. 

Pence brought this action alleging a single violation of 42 U.S.C. § 1983. A 

violation of 42 U.S.C. § 1983 requires a showing that (1) the defendant acted under color 

of state law, and (2) the defendant’s actions deprived the plaintiff of a right secured by the 

United States Constitution or a federal statute. It is undisputed that Pence established the 

first prong of this analysis. 

To satisfy the second prong, Pence alleged a violation of her due process rights 

secured by the Due Process Clause of the Fourteenth Amendment to the United States 

Constitution. The Due Process Clause of the Fourteenth Amendment secures procedural 

and substantive due process rights. Pence’s appeal is directed towards the District 

Court’s holding regarding procedural due process. 

To state a claim under § 1983 for the deprivation of procedural due process rights 
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a plaintiff must allege (1) a deprivation of a protectable property interest and (2) that the 

procedures available did not provide due process of law. Hill v. Borough of Kutztown, 

455 F.3d 225, 233-34 (3d Cir. 2006). Pence contends that her unused sick leave is a 

constitutionally protectable property interest. We disagree. 

Property interests “are created and their dimensions are defined by existing rules or 

understandings that stem from an independent source such as state law-rules or 

understandings that secure certain benefits and that support claims of entitlement to those 

benefits.” Bd. of Regents of State Colls. v. Roth, 408 U.S. 564, 577 (1972). “To have a 

property interest in a benefit, a person clearly must have more than an abstract need or 

desire for it. He must have more than a unilateral expectation of it. He must, instead, 

have a legitimate claim of entitlement to it.” Id. In support of her position that her 

unused sick leave is a constitutionally protectable property interest, Pence relies in part on 

Section 9-136 of Title 40A of the New Jersey statute which authorizes the governing 

body of any municipality to create the office of municipal administrator by ordinance. 

N.J.S.A. 40A:9-136. The statute directs that the municipal administrator “shall receive 

such compensation as the ordinance creating such office shall provide and as from time to 

time may otherwise be directed by the governing body ordinance.” Id. Pence bolsters her 

argument with a discussion of New Jersey State Court case law highlighting the 

difference between municipal action by ordinance and by resolution and interpreting 

purportedly analogous state statutes. 

We are not persuaded that New Jersey law establishes “a legitimate claim of 
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entitlement to” payment for unused sick leave in Pence’s circumstances. First, the statute 

on which Pence relies leaves to the discretion of the municipality the creation of the 

office of municipal administrator. In instances where the municipality chooses to create 

such an office, the statute does not specify the compensation for the position, including 

whether the employee should receive sick leave during the course of employment, let 

alone be compensated for unused sick leave after separation. Rather, the sole basis for 

the sick leave in which Pence argues she has a protectable property interest is the 

Township’s Employee Handbook. By its own terms, the Employee Handbook and the 

policies contained therein can be unilaterally amended by the Township. The Employee 

Handbook does not secure any protectable property interest in payment for accrued sick 

leave. Accord Cooley v. Pa. Hous. Fin. Agency, 830 F.2d 469, 473 (3d Cir. 1987)

(rejecting an employment manual as the basis for plaintiff’s right to continued 

employment, stating “the key to resolving whether a protected property interest has been 

presented through the enabling statute is by identifying a statement of the [] 

legislature . . .”). 

Pence cites two cases that mention vacation and sick time as a constitutionally 

protected property interest: N.J. Ass’n of Sch. Adm’rs v. Schundler, 414 N.J. Super. 530 

(App. Div. 2010) and Caponegro v. State Operated Sch. Dist. of Newark, 330 N.J. Super. 

148 (App. Div. 2000). Both cases address the issue in the context of Title 18A of the 

New Jersey statute, which governs education. Title 40A, which governs municipalities 

and counties, is applicable to Pence’s employment with the Township. For employees 
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governed by Title 18A, sick leave and its accumulation are provided by statute. 

N.J.S.A.18A:30-2, 3. No such right is provided to municipal administrators by Title 40A. 

In light of the differences between the statutory schemes of Title 18A and Title 40A, we 

cannot conclude that there is a protectable property interest in Pence’s case.

Other cases relied on by Pence address employment benefits in the context of a 

contractual right or the validity of a contract, rather than a constitutionally protected 

property interest. See N.J. Ass’n of Sch. Bus. Officials v. Lucille E. Davy, Comm’r, N.J. 

Dep’t of Educ., 409 N.J. Super. 467 (App. Div. 2009); McCurrie v. Town of Kearney, 

344 N.J. Super. 470 (App. Div. 2001). We have recognized only two general types of 

contracts that create protectable property interests: one type is a contract characterized by 

the quality of either the extreme dependence, or permanence and sometimes both; the 

other type is where the contract contains a provision that the state entity can terminate the 

contract only for cause. Unger v. Nat’l Residents Matching Program, 928 F.2d 1392, 

1399 (3d Cir. 1991). If the Employee Handbook is a contract, it is neither type of 

contract that creates a protectable property interest. 

III.

We also see no error in the District Court’s denial of Pence’s motion pursuant to 

Fed. R. Civ. P. 60(b). The denial of a motion to alter or amend a judgment pursuant to 

Fed. R. Civ. P. 60(b) is reviewed under an abuse of discretion standard. Brown v. Phila. 

Hous. Auth., 350 F.3d 338, 342 (3d Cir. 2003). “An abuse of discretion may be found 

when ‘the district court’s decision rests upon a clearly erroneous finding of fact, an errant 
8

conclusion of law or an improper application of law to fact.’” Reform Party of Allegheny 

County v. Allegheny County Dep’t of Elections, 174 F. 3d 305, 311 (3d Cir. 1999) 

(quoting Int’l Union, UAW v. Mack Trucks, Inc., 820 F.2d 91, 95 (3d Cir.1987)). In 

analyzing Pence’s motion, the District Court identified the four Pioneer factors as the 

proper test under Rule 60(b)(1) to determine if a party’s neglect was excusable, and took 

into account the totality of circumstances. Ethan Michael Inc. v. Union Twp., 392 Fed. 

Appx. 906, 909-10 (3d Cir. 2010). Pence neglected to amend her Complaint by the 

deadline set by the Magistrate Judge and delayed six months – until after the parties 

engaged in briefing on the motion for Summary Judgment. The District Court also found 

that the Township would be prejudiced if Pence’s motion was granted.

IV.

For the foregoing reasons, we will affirm the July 21, 2010 and October 15, 2010 

orders of the District Court.