                               UNPUBLISHED

                  UNITED STATES COURT OF APPEALS
                      FOR THE FOURTH CIRCUIT


                               No. 11-1444


STANDARD PACIFIC OF THE CAROLINAS, LLC,

                Plaintiff – Appellant,

           v.

AMERISURE INSURANCE COMPANY,

                Defendant – Appellee.



Appeal from the United States District Court for the District of
South Carolina, at Rock Hill. Joseph F. Anderson, Jr., District
Judge. (0:10-cv-01620-JFA)


Argued:   September 19, 2012                 Decided:   December 19, 2012


Before NIEMEYER and DIAZ, Circuit Judges, and Max O. COGBURN,
Jr., United States District Judge for the Western District of
North Carolina, sitting by designation.


Reversed and remanded by unpublished per curiam opinion.


Payton Dwight Hoover, DEAN & GIBSON, Charlotte, North Carolina,
for Appellant. Tracy Lynn Eggleston, COZEN O'CONNOR, Charlotte,
North Carolina, for Appellee.


Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:

        Standard Pacific of the Carolinas, LLC (“Standard Pacific”)

brought       this     action       against       Amerisure        Insurance     Company

(“Amerisure”), seeking a declaration of its rights to a defense

and indemnity under an “additional insured” endorsement in an

insurance policy.           The district court granted summary judgment

to Amerisure on Standard Pacific’s claim, concluding that the

endorsement did not clearly require the insurer to provide “your

work” coverage.         In our view, however, the district court read

the endorsement too narrowly.                 Rather, construing the policy in

favor    of    the   insured,   we     hold       that    it    provides    coverage   to

Standard Pacific.          Accordingly, we reverse.



                                          I.

                                          A.

        On June 21, 2008, Terry Shortt fell off his bicycle and

broke    his    back    after   encountering             an    allegedly    deteriorated

section of an asphalt walking path in the common area of Ridge

Point Community in Rock Hill, South Carolina.                          Standard Pacific,

formerly known as Westfield Homes of the Carolinas, LLC, was the

developer      of    the    Ridge    Point        Community      project.       Standard

Pacific hired Matthews Construction Company, Inc. (“Matthews”)

as the general contractor for the project pursuant to a “Land

Development-Construction               Agreement”               (the       “Agreement”).

                                              2
Amerisure was Matthews’s insurer.                Matthews completed its work

at the Ridge Point community in August 2004, about four years

before Shortt’s accident.

       Shortt sued Standard Pacific, Matthews, and others in South

Carolina state court, alleging that they jointly and severally

breached their duty to exercise reasonable care in designing,

developing, constructing, managing, and maintaining the walking

path    to    prevent    dangerous      and    hidden      conditions.       Standard

Pacific in turn filed a separate state suit in South Carolina

seeking,      among   other    relief,    the    court’s      declaration        of   the

relative rights and obligations of the parties under the terms

of     an    insurance    policy     issued     by      Amerisure     to    Matthews.

Amerisure subsequently removed the case to the United States

District Court for the District of South Carolina.

                                          B.

       Amerisure issued a Commercial General Liability Insurance

Policy to Matthews, effective from January 1, 2008, to January

1, 2009.      The policy had a general aggregate limit of $2,000,000

and     a    “products-completed         operations”        aggregate       limit      of

$2,000,000.       J.A.    112.     The    policy     included     a   “Contractor’s

Blanket      Additional       Insured    Endorsement.”           J.A.      28.        The

endorsement      provided     coverage    under      the    policy    to   additional

parties whom Matthews was required to insure by “written contact



                                          3
or agreement.”         The endorsement limited the coverage of such

additional parties to liability arising out of:

       (a) Premises you own, rent, lease, or occupy, or
       (b)   Your  ongoing operations    performed   for that
       additional insured, unless the written contract or
       agreement or the certificate of insurance requires
       “your work” coverage (or wording to that same effect)
       in which case the coverage provided shall extend to
       “your work” for that additional insured.

Id. (emphasis added).          The policy defined “your work” as “[w]ork

or operations by you or on your behalf” and “[m]aterials, parts

or    equipment      furnished     in    connection        with    such     work     or

operations.”       J.A. 105.

       The     Agreement,      which     predated       the    insurance         policy,

contained several provisions relevant to this appeal.                      First, it

required Matthews to furnish Standard Pacific with a certificate

from a licensed insurance company showing that (1) Matthews had

in    effect   a   policy    of   general      liability      insurance     providing

coverage     at    least   equivalent     to    the    1986    Commercial        General

Liability      Insurance     policy, 1    with    at     least    “a   $500,000.000

Products/Completed         Operations    Aggregate       Limit,”    J.A.    184,     and

(2)   Standard     Pacific’s      predecessor,        Westfield    Homes    of     North

Carolina, was an additional insured under the policy.                      Id.




       1
       The 1986 Commercial General Liability Insurance Policy is
a standard form insurance policy created by the Insurance
Services Organization.



                                          4
      Second, the Agreement required Matthews to:

      “indemnify,   defend   and   hold   harmless  [o]wner,
      [c]onstruction [m]anager and the owner of the Site . .
      . from and against any and all claims, loss, damage or
      expense (including attorneys’ fees and other costs of
      defense incurred by [o]wner in defending against any
      claims or in enforcing this indemnity and defense
      obligation) arising out of or in connection with the
      performance of the [w]ork.”

Id.

                                            C.

      Standard       Pacific       moved    for        “Partial       Judgment       on     the

Pleadings/Summary           Judgment”       regarding          Amerisure’s          insurance

coverage and duty to defend.                J.A. 350-56.            The district court

denied      the    motion    and     instead         sua    sponte      granted       summary

judgment     to     Amerisure.        The       court       noted     that,     “the      plain

language of the insurance policy allows for ‘your work’ coverage

for   the     additional       insured      only       when     a     written       agreement

requires it explicitly or with equivalent language.”                                J.A. 559.

The court reviewed the Agreement between Standard Pacific and

Matthews      and     concluded       that           “[n]owhere       in      the      ‘Work,’

‘Protection of Work,’ or ‘Indemnity’ sections [of the Agreement]

does Matthews agree to provide the equivalent to ‘your work’

coverage.”          J.A.    558.      And       to    the    extent     that     there      was

ambiguity     as    to     what    type    of       coverage    was    required        by   the




                                                5
Agreement, the district court concluded that any ambiguity was

to be construed against Standard Pacific as the drafter. 2

     Standard Pacific moved for reconsideration of the district

court’s    order,     which     the   court       denied.      After       voluntarily

dismissing,      without     prejudice,     its    remaining       claims,   Standard

Pacific timely appealed.



                                           II.

     We review a grant or denial of summary judgment de novo,

applying       the   same    standard      applied    by     the   district     court.

Overstreet v. Kentucky Cent. Life Ins. Co., 950 F.2d 931, 938

(4th Cir. 1991).

     We consider here whether the language of the Agreement is

sufficient to trigger coverage for Standard Pacific under the

additional insured endorsement contained in the Amerisure policy

issued    to     Matthews.       Amerisure        contends     that    the    coverage

afforded   Standard         Pacific   by    the    endorsement        is   limited   to

Matthews’s      ongoing     operations      because    the    Agreement      does    not

clearly require “your work” coverage.                 Standard Pacific responds

that the endorsement does not require the use of the term “your

     2
       The district court also held that the Agreement does not
violate   South   Carolina  Code   § 32-2-10,   which  declares
construction contracts that indemnify the promisee against
liability resulting from their own negligence void as against
public policy. That ruling has not been appealed.



                                            6
work” to provide the relevant coverage, but rather allows for

coverage       if   the    Agreement          includes       “wording       to    that     same

effect.”       According to Standard Pacific, such wording is found

in several places in the Agreement.                          We agree with Standard

Pacific.

       Under    South     Carolina       law,       “clauses    of   exclusion”          in    an

insurance       policy      are    to     be       “narrowly     interpreted,”            while

“clauses of inclusion” are “to be broadly construed.”                              McPherson

v.    Mich.    Mut.   Ins.       Co.,    426       S.E.2d    770,    771    (S.C.    1993). 3

Relatedly, where the words of an insurance policy are capable of

two    reasonable         interpretations,           the     court     will       adopt       the

construction most favorable to the insured.                          Forner v. Butler,

460 S.E.2d 425, 427 (S.C. 1995).                     In this case, the endorsement

issued to Matthews by Amerisure requires that a contract with an

additional insured include the phrase “your work” or “wording to

that   same     effect”     in    order       to    invoke    coverage      for    completed

operations.         Thus, Standard Pacific is entitled to coverage if

the Agreement satisfies either one of these conditions.

       Although it is certainly true, as the district court found,

that   the     Agreement     does       not    explicitly      refer       to    “your    work”


       3
       The parties do not dispute that this diversity action is
governed by the law of South Carolina. Nor do they assert that
the appeal presents anything other than a question of law
regarding the scope of coverage under the policy.



                                               7
coverage, we conclude that it does include “wording to that same

effect”    sufficient       to    trigger        coverage.          To   begin    with,     the

“Liability       Insurance”       section        of     the     Agreement        requires     a

minimum     amount     of    “Products/Completed                Operations”        coverage,

which South Carolina law recognizes as encompassing coverage for

“bodily     injury    and        property        damages       arising     out    of     ‘your

product’ or ‘your work.’”             Laidlaw Envtl. Servs. (TOC), Inc., v.

Aetna Cas. & Sur. Co. of Ill., 524 S.E.2d 847, 851 (S.C. 1999).

Moreover,    the     “Indemnity”         section       of     the   Agreement      obligates

Matthews to indemnify and hold harmless Standard Pacific “from

and against any and all claims, loss, damage or expense . . .

arising out of or in connection with the performance of the Work

or any portion thereof.”              J.A. 185 (emphasis added).                    Although

“arising     out     of”    and     “performance”             are    undefined      in      the

Agreement, the meaning of those terms given by other sources

supports    the     conclusion       that    the       parties       contemplated        “your

work” coverage.

     In that regard, the Supreme Court of South Carolina has

interpreted “arising out of” to mean “caused by” in the context

of   an    exclusionary          clause     in     a    general      liability         policy.

McPherson, 426 S.E.2d at 771.                     Additionally, “performance” is

commonly understood to mean “[t]he successful completion of a

contractual        duty”    and     is     also        “termed      full    performance.”

Black’s    Law     Dictionary       1252     (9th       ed.    2009).       And     although

                                             8
“performance” usually “result[s] in the performer’s release from

any     past     or     future       liability,”       id.,     the    parties          here

specifically      contracted         for    prospective       indemnity      for   claims

arising out of the performance of Matthews’s work.

      In sum, Matthews committed in the Agreement to extend “your

work” coverage to Standard Pacific, if not expressly then by

using    “wording      to     that   same    effect”    as     contemplated        by    the

policy endorsement.            We think this conclusion is both free from

doubt and consistent with a view of the policy most favorable to

the insured.          McPherson, 426 S.E.2d at 771.              The district court

therefore erred in granting summary judgment to Amerisure.



                                            III.

      For the foregoing reasons, we reverse the judgment of the

district       court    and    remand      with    instructions       that    it    enter

summary judgment for Standard Pacific.

                                                              REVERSED AND REMANDED




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