Owner, Pam Charity, is selling the cottage and historic inn, the Flag Inn and Royal Hotel, which has been the site of scandal. In the mid-1800s notorious Upper Lachlan Shire bushranger Ben Hall held up the Boxing Day Ball at the Flag Inn.

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Various licensees operated the hotel, including John O'Brien, a former Binda policeman, and his step-son, John Hall. The license to sell liquor was held until 1921, but it had ceased running as a hotel and was later a boarding house.

The existing building of local bluestone and quartzite was erected to replace the decrepit old building in 1890.

Ms Charity purchased the cottage and moved from Bowral to Binda.

As a restaurateur in Balmain and then Bowral, Ms Charity had hoped to establish a cafe at the store and still believed an enterprise of this type would be successful.

Throughout, Ms Charity's brightly coloured puppets and vintage furniture adorn the rooms. She's at home among the menus she has written for establishments the Bowral Cafe and That Noodle Place at Bowral.

She admits she is a collector.

"From a young age I fell in love with furniture," she said.

An eighteenth-century dining table holds place in the feasting room, an old ferry seat substitutes for a table seat, and paintings fill the spaces on the gallery walls.

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Ms Charity and musician husband worked in restaurants for decades moving from the affluent Balmain to the Southern Highlands.

"My husband died 11 years next March, I'd always spoken about opening a weekender in the country. I went to see Markdale after they opened it in winter to show the bones of the garden, we passed the cottage and there were newspapers on all the windows and I purchased it soon after.

"It's been a good journey," she said

Ms Charity with the help of local contractors and family worked to rebuild the character of the house. They replaced the windows in the sitting room, rebuilt the kitchen, ripped up the carpets to expose the floorboards.

"I don't really want to leave," Ms Charity confessed.

"I just feel the time has come and I must be sensible and I am a bit of a gypsy.".

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In 1864, notorious Upper Lachlan bushranger Ben Hall and his gang tormented revellers at the Boxing Day Ball at the Flag Inn, Binda.

On their way to the ball, they held up and robbed the Flagstaff Store and forced the owners to dress and attend the ball. Using the money which was stolen from the store Hall put 30 pounds on the bar.

The revellers mixed with the bushrangers until Edward Morris, owner of the store, escaped to warn the police. The bushrangers threatened to burn the store, but Mr Morris' wife pleaded with them to save her dresses. Bushranger, Johnny Gilbert saved an armful of dresses before he and John Dunn razed the store to the ground. It is believed the store's loss was over 1000 pounds.

The bushrangers escaped, but Hall's girlfriend Christina McKinnon, and Margaret and Ellen Monk were left to the police. The women were arrested and charged, however, no one in Binda would testify against them. The women were freed after a year.

History: Hotels, Inns and Shanties of the Upper Lachlan Shire.