Hereafter when any bond, warrant or coupon drawn against any local improvement fund is presented to the city for payment and there is not sufficient amount in said local improvement fund against which to draw to pay the same, unless otherwise requested by the holder, payment therefor shall be made by warrant drawn against the local improvement guarantee fund. Such warrants when presented to the city treasurer for payment, if not paid, shall be registered and shall draw interest at a rate not to exceed six percent (6%) per annum, as may be fixed by the city council. Neither the holder nor the owner of any bond or warrant issued under the provisions of this chapter shall have any claim therefor except for the payment from the special assessment made for the improvement for which said bond or warrant was issued, and except as against the local improvement guarantee fund provided in this chapter. The city shall not be liable to any holder or owner of said bond or warrant for any loss to any guarantee fund occurring in the lawful operation thereof by the city. (1994 Code; Ord. 160 § 4, 1956)