delivered the opinion of the court.
*27This case involves a controversy between the holders of uncertified bonds and the holders of certified bonds. The former contend that they, as well as the latter, have a right to participate in the distribution of certain trust funds, and the latter deny the right of the former to so participate. The trial court held that the holders of uncertified bonds are not entitled to participate.
The Equitable Bond and Mortgage Company entered into an agreement with the Colorado National Bank, as trustee. The agreement recites that the company “has issued and will from time t'o time duly execute and issue” its savings bonds and its coupon bonds, and agnees “as security for1 all bonds, delivered to it under the agreement, with the bank’s certificate thereto affixed,” to assign and deliver to the bank deeds of, trust or mortgages and the notes secured thereby in the principal sum of not less than 110 per cent of the face value of all coupon bonds “delivered to it by the Bank,” and also 110 per cent of the loan or cash surrender value of the savings bonds; or1, in lieu thereof, 100 per cent of said values in cash. In one paragraph of the agreement the company assigned to the bank certain notes, mortgages and deeds of trust’ described in schedules attached to the agreement. In the agreement it is declared to be “the meaning and intention of the parties that all of the mortgages and deeds of trust and notes thereby secured which shall be deposited and held by the bank at any time, and any cash so deposited, shall be held in trust for the equal pro rata benefit and security of all bonds which shall be delivered duly certified by the bank to the company for said notes, mortgages, deeds of trust and cash.” The agreement provides that in case of the company’s default in payment of principal or interest or breach of any covenant, all bonds, at the option of the holders of 25 per cent of the outstanding coupon bonds and 25 per cent of the cash surrender value of the outstanding savings bonds, manifested in writing to the bank, shall become immediately due and payable; whereupon the bank shall *28sell the securities or collect the notes or foreclose the trust deeds or mortgages, and take all other steps, by suit or otherwise, to protect the rights and interests of the holders of the outstanding bonds. It is provided, also, that a majority in interest of the holders of all outstanding bonds may, by an acknowledged instrument in writing delivered t'o the bank, direct the bank to waive any default on the part of the company other than a default in the pajment of the principal at maturity.
The coupon bonds are in the ordinary form of such bonds, and contain a promise to pay a specified principal sum at a given date, with interest evidenced by coupons. Each of these bonds refers to the trust agreement for the terms and conditions upon which the bond is issued, and provides: “This bond shall hot be valid or obligatory for any purpose unless authenticated by the certificate endorsed hereon executed by the trustee. ’ ’
Each of the savings bonds provides that in consideration of the payment of a specified amount monthly in advance for ninety-nine months, the company shall pay a specified amount to the record owner. Each bond, both coupon and savings, provides that it is subject to the privileges, terms and conditions on the back of the bond. Among the conditions appearing on the back of the savings bonds are these: That the company shall “hold in escrow” with the bank secured notes, etc., in an amount equal to 110 per cent of “the liability or cash surrender value ’ ’ of the bond; that the holder shall pay to the company $7.50 each month on each $1,000 bond until ninety-nine monthly payments shall have been made; and that should the bond become “permanently delinquent” before the payment of twelve monthly installments, the company shall issue a paid-up bond for the full amount paid in, plus interest. Printed on the bond is a table setting-out the loan or surrender value of such bond, which value increases semi-annually according to the number of monthly payments that have been made. Upon the sale of savings bonds, the company, in some instances, *29delivered in place of the bond an “interim certificate,” reciting that the person named had purchased a certain savings bond, designated by serial number, and reciting the provisions and conditions of the bond.
The certificate to be signed by the bank, as trustee, is printed on the back of each bond. It is as follows: “Trustee's Certificate. It is hereby certified that the within bond is one of the bonds of The Equitable Bond and Mortgage Company described in and secured under that Company’s Trust Agreement with this bank...... ........, Trustee.” The bonds so certified are referred to in this opinion as certified bonds; the others are referred to as uncertified bonds.
The plaintiffs in error and those persons represented by them are holders of savings bonds and interim certificates that never have been certified.
No coupon bond, savings bond or interim certificate was delivered to the bank for certification prior to its issuance or sale. The company sold such bonds and interim certificates without certification by the bank. After their sale some of the bonds so sold were brought to the bank by the purchasers or by some officer of the company, and were certified by the bank; but the bonds and interim certificates held by the plaintiffs in error and by the persons represented by them were not among them. At the time of the appointment of the receiver, savings bonds creating a liability in an amount in excess of $110,000, and coupon bonds in an amount in excess of $27,000, had been so certified. From time to time the company deposited, with the bank, under the trust agreement, securities aggregating the face value of $100,000. Their book value at the date of the appointment of the receiver was $107,097.83. Their actual value, as stated in the stipulation, “is” less than that amount. Discussing that situation, the trial court said: “Whether there was on deposit with said bank, as trustee, at all times, when such ‘Savings Bonds’ and ‘Coupon Bonds’ were so certified by the bank, securities of the character *30designated in amount equal to 110 per cent of the face or cash surrender values of said bonds certified, or 100 per cent of such values in cash, as required by the trust indenture, does not appear, although it is hardly to be supposed that the bank, as trustee, would have certified the bonds, unless such had been the fact.”
At the time of the appointment of the receiver the actual value of the company’s assets other than those in the hands of the bank was $10,000. At that time there were outstanding uncertified bonds “in the amount of liability, principal and interest, approximately $95,000.” It was stipulated: “That until after October 1,1930, and immediately prior to the appointment of the receiver herein, said trustee had no knowledge or notice that there had been sold or issued by the company, or were outstanding, any savings bonds or interim certificates other than those which had been certified * *
The trust agreement contemplated that the company should deposit its bonds with the bank; that from time to time it would deposit with the bank secured promissory notes of a value equal to the prescribed percentage in excess of the amount of bonds sought to be withdrawn; that thereupon the bank should certify and deliver to the company the bonds so secured by the trust funds so deposited; and that thereupon the company might sell the bonds so certified and delivered to it by the bank. This plan was departed from. The bonds were sold without certification. The purchasers or an officer of the company presented some of the bonds to the bank for certification, and if at that time there was in the possession of the bank, as trustee, securities of sufficient value to protect the bonds so- presented, the bank would certify such bonds. So long as sufficient securities were on hand to cover the bonds so certified, this departure from the original plan harmed no one.
Every purchaser of a bond was bound by the terms of the trust agreement, and that instrument made it clear that only certified bonds are secured by the trust funds. *31That is made clear hy the several provisions of the agreement, the express declaration of intent quoted above, and by the agreement taken as a whole. Any other construction would defeat the very purpose of the trust agreement. Furthermore, it would nullify some of it's important provisions; for example, the provision concerning the acceleration of the maturity of the bonds, at the option of the holders of a certain percentage of the outstanding bonds, and the provision concerning the right of the holders of a majority in interest of all outstanding bonds to waive default. The only way in which the bank could determine whether the signers of the declarations presented to it constitute the holders of the required percentage of outstanding bonds would be by examining its list of the bonds certified by it. The bank had no knowledge of bonds sold by the company until they were presented to it for certification.
When the plaintiffs in error and the persons they represent purchased savings bonds, the fact that the bonds were not certified was obvious; the printed form for the certificate was not signed by the bank. They should not have purchased the bonds in that condition. But having purchased them, the holders, if they were unwilling to rely upon the company’s mere promise to pay and desired to share in the security afforded by the trust fund, could and should have presented their bonds to the bank for certification. If certification was refused by reason of the company’s failure to deposit sufficient securities to cover the bonds, the holders could have demanded of the company a compliance with its promise to “hold in escrow” with the bank securities or cash in the agreed amount. If the company failed to comply with the demand, the holders could have sued the company for a breach of its contract. If the holders purchased in reliance upon any false representations, an action for damages would lie against the one making such representations. But whatever right's the holders of uncertified bonds and interim certificates may have, it is clear that *32they have no right to participate in a. distribution of the-trust fund to the prejudice of the rights of the holders of certified bonds, and the trial court’s decision to that effect was not erroneous.
The judgment is affirmed.
Mr. Chief Justice Adams, Mr. Justice Hilliard and Mr. Justice Bouck dissent.