fails to fulfill any of the terms and conditions of this contract ... and also if any loss/damage occurs to the buyer due to any fault of the seller'. It seems to me that on a proper construction of this clause, there is no indication that it was the parties' intention that the bond would either satisfy the whole of the buyer's damages (see above), or prevent the seller from recovering any overpayment. The word 'forfeit' might be apt to suggest that once called, the bond moneys had 'gone' for good. But if it had been the intention of the parties to produce a result whereby the buyer could both call on the bond and sue for damages, whereas the seller forfeited his right to any overpayment, then much plainer words would have been required to take this case away from the general principles as I perceive them to be. That being so, it seems to me that treating the two parts of the clause disjunctively, and treating the right to forfeit as arising if either there was a breach or if any loss or damage occurred to the buyer due to any fault of the seller (which might not be a breach) would make commercial good sense. The buyer is stipulating clearly that, as between himself and the seller, all he needs to show to be entitled to call on the bond is a breach of contract; he need not show damage (although damage will almost always follow); if, on the other hand, say through a misrepresentation by the seller, damage was caused to the buyer then the right to call the bond was conferred by the second half of the clause. But in either event, there will be an 'accounting' at trial or arbitration to ensure that the buyer has not been underpaid or overpaid.
