[penal bond - land law, mortgage - Pittwater]

Lascelles v. Kemp and Gatehouse
Supreme Court
Field J., 13 February 1821
Source: Sydney Gazette, 24 March 1821

This was an action of debt brought to recover the sum of £1000, being the penalty of a bond dated the 7th May, 1813; and the condition alleged to be broken was contained in the following words:
"Now the condition of this obligation is such, that in the above named T.A. Lascelles shall well and truly pay, or cause to be paid, unto the said A.E. Kemp and G. Gatehouse, or to their assigns, the sum of £850 of good and lawful money, while before the first day of April, 1819, and legal interest to be computed from the 3rd day of March, last past, being for the redemption of a certain farm or farms and buildings situate and lying at Pitt Water, in the district of Sussex, and formerly in the occupation of the said T.A. Lascelles, &c, &c, &c, these conditions being fulfilled and truly performed, this obligation shall be null and void: otherwise to remain in full force and virtue in law."
It appeared, that on the 12th March, 1818, the plaintiff being indebted to the defendants in the sum of £850, conveyed to them absolutely two[?] farms at Pitt Water, of 800 acres and 300 acres, and that that sum was the only consideration mentioned in the deeds. On the 7th May following, the defendants executed the above bond, which the only conditions, not above set out, were covenants on the part of the defendants to deliver up the premises in good condition and repair; and that the plaintiff should be at liberty at any time before the 1st April to enter for the purpose of selling the premises. The plaintiff endeavoured to prove, that the premises were at the time of their mortgage worth £2000 and that the meaning of the parties was what the bond literally expressed; namely, that if the plaintiff did not choose to redeem before the 1st April, the defendants were to pay him £1000 besides the £850 for the absolute purchase of the farms; he had not paid the defendants £850, on or before the 1st; and therefore the bond was forfeited, and the defendants owed him £1000. But one of the subscribing witnesses to the bond proved, that this was not the understanding of the parties, and that the only intention of the bond was, to compel the defendants to suffer the premises to be redeemed under the penalty of £1000 It was also proved by Mr Lewis, the auctioneer, that he was instructed by the plaintiff, about the time of this bond, to sell the premises for £1000.
Mr. Justice Field remarked upon the absurdity of the above condition of the bond, which put its forfeiture in the power of the obligor, and not of the obligees; and had no doubt, that if it had been drawn by a professional man, the condition would have gone on:
"If the said A.F. Kemp and G. Gatehouse, upon such payments being duly made, shall deliver up to the said T.A. Lascelles, his heirs, &c the said lands and buildings in as good condition and repair as they are now in, this obligation shall be void: otherwise to remain in full force and virtue," instead of making this surrender the subject of a separate covenant and condition. There was no doubt that the defendants were entitled in a verdict; but under all the circumstances that had been proved, the learned Judge thought[?], that the mortgage might still be redeemed in equity.