Whenever any municipality has established such "Local Improvement Guarantee Fund," any bond, warrant or coupon drawn against any local improvement fund is presented to the municipality 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 draw interest at a rate as may be fixed by the council. Neither the holder nor the owner of any bond or warrant issued under the provisions of this act shall have any claim therefor, except for payment from the special assessments made for the improvement for which said bond or warrant was issued, and except as against the "Local Improvement Guarantee Fund" herein provided, and the municipality shall not be liable to any holder or owner of such bond or warrant for any loss to the guarantee fund occurring in the lawful operation thereof by the municipality.