A bond is nothing more than an agreement or contract under seal to pay money or to do some thing and an action upon a bond is an action at law[i].
The Webster’s New International Dictionary defines “bond” as follows: “ A writing under seal by which a person binds himself to pay a certain sum on or before a future day appointed. This is a single, or simple bond. Usually a condition is added, that if the obligor shall do (or abstain from doing) a certain act on or before a time specified the obligation shall be void, but otherwise shall remain in full force. The Bouvier’s Law Dictionary, Rawle’s Third Revision, defines a “bond” as “An obligation in writing and under seal”[ii].
A bond may be either single or conditional. It is single when the obligor binds himself or herself, his or her heirs, administrators, or executors to pay a fixed sum of money on a certain day. It is conditional when the obligor undertakes for himself or herself, his or her heirs, administrators, or executors to pay a certain sum of money conditioned that if he does some particular act, the obligation will be void, or the obligor stipulates that the obligation remain in full force in the event the obligor does some particular act or fails to do such an act[iii]. The only covenant or promise to pay by the obligor in such bonds is to pay the penalty if the condition is not fulfilled. They are otherwise known as penal bonds. However, in this context, a bond is the instrument that legally binds a party to do a certain act.
A bond is a contract and therefore subject to the general law of contracts, such as (1) the intent of the parties to the contract governs the construction of a contract, and (2) to determine the intent of the parties, a court should consider the language in the contract, the subject matter of the contract, and the object and purpose of the contract.
When the legislature, in licensing occupational groups, requires a bond as a part of the general scheme to protect the public, the bond is an indemnity rather than a penal bond.
An official bond is a type of surety bond. It guarantees that public officials will faithfully and honestly discharge their obligations to the state or to other public agencies. Public officials are responsible for a broad range of property including fees that they collect, money that they handle, and bank accounts that they oversee. They may also be held responsible for misdeeds that result in a loss of public funds by those they supervise. In some cases coverage is available for an entire group of employees under a Public Employees Blanket Bond.
[i] Moore Elec. Supply, Inc. v. Ward, 316 S.C. 367 (S.C. Ct. App. 1994)
[ii] Ex parte Cattell, 146 Ohio St. 112 (Ohio 1945)
[iii] Fidelity & Columbia Trust Co. v. Lyons, 302 Ky. 839 (Ky. 1946)