Whenever there shall be paid out of such guarantee fund any sum on account of principal or interest of a local improvement bond or warrant, as herein provided, the city, as trustee for the fund, shall be subrogated to all the rights of the holder of the bond, interest coupon or warrant so paid, and the proceeds thereof or of the assessment underlying the same shall become part of the guarantee fund. (Ord. 72A, § 5, 1934.)