Mr. Justice Butler
delivered the opinion of the court.
’’ Though there are many defendants in error named in the writ, the Colorado National Bank alone entered an appearance in this court.
■ The proceeds of a foreclosure sale being insufficient to satisfy the claims of both the plaintiff in error and the Colorado National Bank, one of the' defendants in error, w.e are called upon to determine the former’s right to share in the proceeds. There is no dispute as to the facts. The Twin Lakes Land and Water Company executed a deed of trust to secure the payment of its principal note for $6,000 and the interest thereon. The note, which was dated December 1, 1925, was payable to the order of the Western Securities Investment Company on December 1, 1930. Two sets of interest coupons were executed. One set represented 6 per cent interest. These coupons were attached to the principal note. By endorsement the Colorado National Bank of Denver became the owner of the principal note, with the attached coupons. The other coupons, representing 1 per cent interest, were never attached to the principal note, but were retained by the [531]*531investment company until they passed into the possession of the International Trust Company in the following manner: The investment company executed what are called collateral gold notes. To secure the payment of the gold notes, it endorsed and delivered to the International Trust Company, in trust, the 1 per cent interest coupons above referred to, together with many other interest coupons not involved in this suit; and the investment company with the trust company, executed an instrument stating the nature and conditions of the trust. Later the trust company resigned as trustee and Henry W. Toll became its successor.
In the deed of trust given to secure the Twin Lakes Land and Water Company’s note and interest it is stipulated :
“That in case of default in the payment of said principal or interest notes, according to the tenor and effect of the same, or either of them, or the interest thereon, or any part thereof, or of a breach or violation of any of the covenants or agreements herein, by the party of the first part, its successors or assigns, then and in that case the whole of said principal sum hereby secured, and the interest thereon at the time of sale, may at once, at the option of the legal holder or holders thereof, become due and payable, and the said premises be sold in the manner and with the same effect as if the said indebtedness had matured by lapse of time. ’ ’
There being a breach of the agreement to pay taxes that were due, as well as a failure to pay interest, the bank exercised its option under the foregoing clause, and, on December 31, 1927, sued to foreclose as a mortgage the deed of trust securing the indebtedness. Toll, trustee, was made a party defendant. The court decreed a sale to pay, first, the court costs and the expenses of the sale, and then the amount of the indebtedness, including the amount of such of the interest coupons held by both the bank and Toll as had matured at the date of the decree, together with interest thereon; the payment of prin[532]*532eipal and interest to be made proportionately, without priority as between.principal and interest or as between the bank and Toll. The court refused to allow the claim of Toll to share in the proceeds of the sale to the extent of his unmatured interest coupons. Of this ruling Toll complains. The bank, by a cross-assignment of error, complains of the court’s refusal to give the claim of the bank priority over Toll’s claim. These objections present the two principal questions to be decided by the court. We will consider the bank’s contention first, for if Toll is not entitled to share proportionately in the proceeds to the extent of his matured interest coupons, it follows, as a matter of course, that he would not be entitled to share proportionately in the proceeds to the extent of his unmatured interest coupons.
1. It is said that the circumstances attending the sale to the bank of the principal note, with the attached interest coupons, were such as to estop the Western Securities Investment Company from prorating with the bank; and that as that company, if it had sued to foreclose, could not prorate, Toll cannot prorate.
(a) To sustain the contention that the Western Securities Investment Company could not prorate with the bank, it is said that when the bank purchased the principal note, the Western Securities Investment Company delivered to the bank the principal note with the 6 per cent interest coupons attached, the trust deed, the insurance policy, a title opinion and a prospectus,* that the bank believed that the documents thus delivered constituted all the papers relating to the loan; that the prospectus states that the loan is to net 6 per cent interest per annum, payable semiannually; that by this statement and certain ambiguities in the documents, the bank was made to believe that it was purchasing the entire loan; that “this would have been the belief of anyone except a person with an astute legal mind who had carefully gone through the fine print, carefully weighed the same and measured the possibilities'of the peculiarly ambiguous [533]*533phrases”; and that “it was a clever misrepresentation perpetrated through the means of ambiguity.”
Assuming, but not deciding, that, by reason of fraudulent misrepresentations or concealment by the Western Securities Investment Company it would be estopped to prorate with the bank; we are aware of no principle of law that would visit upon the innocent trustee, and through him upon the innocent gold note holders, the sins and shortcomings of that company. If that company were denied the right to prorate with the bank, it would be not because of any infirmity in the coupons, or any defect in the company’s title thereto, or because of any other defense to the coupons, but because it would be unfair and inequitable, by reason of the company’s fraud, to permit the company to prorate with the bank. The trustee and the gold note holders did not participate in the transaction between the company and the bank, and were not responsible for any misrepresentation or concealment by the company.
(b) But it is said that ‘ ‘ even if there had been no fraud or bad faith in the transaction, the Western Securities Investment Company, being the original mortgagee, there being no agreement, express or implied, that it should prorate, and it having sold part of the loan for its face value, could not prorate, and thus to its own advantage prevent its purchaser from procuring out of the security at least what it paid to the Western Securities Investment Company.”
Counsel quotes the following from the syllabus to Georgia Realty Co. v. Bank of Covington, 19 Ga. App. 219, 91 S. E. 267: “Where several notes are secured by a mortgage or otherwise, and the holder of the security transfers one of the notes and retains the others, the transferee has a preference over the assignor if the security is insufficient to pay all the notes. The equity existing in favor of the assignee and against the assignor in such case is considered sufficient to create a preference in favor of the assignee.” That principle could be in[534]*534voked against the assignor, not as between two assignees or endorsees.
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Mr. Justice Butler
delivered the opinion of the court.
’’ Though there are many defendants in error named in the writ, the Colorado National Bank alone entered an appearance in this court.
■ The proceeds of a foreclosure sale being insufficient to satisfy the claims of both the plaintiff in error and the Colorado National Bank, one of the' defendants in error, w.e are called upon to determine the former’s right to share in the proceeds. There is no dispute as to the facts. The Twin Lakes Land and Water Company executed a deed of trust to secure the payment of its principal note for $6,000 and the interest thereon. The note, which was dated December 1, 1925, was payable to the order of the Western Securities Investment Company on December 1, 1930. Two sets of interest coupons were executed. One set represented 6 per cent interest. These coupons were attached to the principal note. By endorsement the Colorado National Bank of Denver became the owner of the principal note, with the attached coupons. The other coupons, representing 1 per cent interest, were never attached to the principal note, but were retained by the [531]*531investment company until they passed into the possession of the International Trust Company in the following manner: The investment company executed what are called collateral gold notes. To secure the payment of the gold notes, it endorsed and delivered to the International Trust Company, in trust, the 1 per cent interest coupons above referred to, together with many other interest coupons not involved in this suit; and the investment company with the trust company, executed an instrument stating the nature and conditions of the trust. Later the trust company resigned as trustee and Henry W. Toll became its successor.
In the deed of trust given to secure the Twin Lakes Land and Water Company’s note and interest it is stipulated :
“That in case of default in the payment of said principal or interest notes, according to the tenor and effect of the same, or either of them, or the interest thereon, or any part thereof, or of a breach or violation of any of the covenants or agreements herein, by the party of the first part, its successors or assigns, then and in that case the whole of said principal sum hereby secured, and the interest thereon at the time of sale, may at once, at the option of the legal holder or holders thereof, become due and payable, and the said premises be sold in the manner and with the same effect as if the said indebtedness had matured by lapse of time. ’ ’
There being a breach of the agreement to pay taxes that were due, as well as a failure to pay interest, the bank exercised its option under the foregoing clause, and, on December 31, 1927, sued to foreclose as a mortgage the deed of trust securing the indebtedness. Toll, trustee, was made a party defendant. The court decreed a sale to pay, first, the court costs and the expenses of the sale, and then the amount of the indebtedness, including the amount of such of the interest coupons held by both the bank and Toll as had matured at the date of the decree, together with interest thereon; the payment of prin[532]*532eipal and interest to be made proportionately, without priority as between.principal and interest or as between the bank and Toll. The court refused to allow the claim of Toll to share in the proceeds of the sale to the extent of his unmatured interest coupons. Of this ruling Toll complains. The bank, by a cross-assignment of error, complains of the court’s refusal to give the claim of the bank priority over Toll’s claim. These objections present the two principal questions to be decided by the court. We will consider the bank’s contention first, for if Toll is not entitled to share proportionately in the proceeds to the extent of his matured interest coupons, it follows, as a matter of course, that he would not be entitled to share proportionately in the proceeds to the extent of his unmatured interest coupons.
1. It is said that the circumstances attending the sale to the bank of the principal note, with the attached interest coupons, were such as to estop the Western Securities Investment Company from prorating with the bank; and that as that company, if it had sued to foreclose, could not prorate, Toll cannot prorate.
(a) To sustain the contention that the Western Securities Investment Company could not prorate with the bank, it is said that when the bank purchased the principal note, the Western Securities Investment Company delivered to the bank the principal note with the 6 per cent interest coupons attached, the trust deed, the insurance policy, a title opinion and a prospectus,* that the bank believed that the documents thus delivered constituted all the papers relating to the loan; that the prospectus states that the loan is to net 6 per cent interest per annum, payable semiannually; that by this statement and certain ambiguities in the documents, the bank was made to believe that it was purchasing the entire loan; that “this would have been the belief of anyone except a person with an astute legal mind who had carefully gone through the fine print, carefully weighed the same and measured the possibilities'of the peculiarly ambiguous [533]*533phrases”; and that “it was a clever misrepresentation perpetrated through the means of ambiguity.”
Assuming, but not deciding, that, by reason of fraudulent misrepresentations or concealment by the Western Securities Investment Company it would be estopped to prorate with the bank; we are aware of no principle of law that would visit upon the innocent trustee, and through him upon the innocent gold note holders, the sins and shortcomings of that company. If that company were denied the right to prorate with the bank, it would be not because of any infirmity in the coupons, or any defect in the company’s title thereto, or because of any other defense to the coupons, but because it would be unfair and inequitable, by reason of the company’s fraud, to permit the company to prorate with the bank. The trustee and the gold note holders did not participate in the transaction between the company and the bank, and were not responsible for any misrepresentation or concealment by the company.
(b) But it is said that ‘ ‘ even if there had been no fraud or bad faith in the transaction, the Western Securities Investment Company, being the original mortgagee, there being no agreement, express or implied, that it should prorate, and it having sold part of the loan for its face value, could not prorate, and thus to its own advantage prevent its purchaser from procuring out of the security at least what it paid to the Western Securities Investment Company.”
Counsel quotes the following from the syllabus to Georgia Realty Co. v. Bank of Covington, 19 Ga. App. 219, 91 S. E. 267: “Where several notes are secured by a mortgage or otherwise, and the holder of the security transfers one of the notes and retains the others, the transferee has a preference over the assignor if the security is insufficient to pay all the notes. The equity existing in favor of the assignee and against the assignor in such case is considered sufficient to create a preference in favor of the assignee.” That principle could be in[534]*534voked against the assignor, not as between two assignees or endorsees. The rule applicable to the present case is thus stated in another paragraph of the same syllabus: “In the absence of an agreement or a special equity to the contrary, assignees holding separately several notes secured by a mortgage or otherwise are entitled to share pro rata, and without any preference, in the proceeds arising from the sale of the security, when insufficient to satisfy them all; and this is true, although the notes matured on different dates and the assignments were made at different times.” Other cases cited by counsel for the bank are in accord with the Georgia case.
There is no legal obstacle to Toll’s prorating with the bank to the extent of his matured interest coupons. In permitting him to so prorate, the trial court committed no error.
2. The trial court also ruled correctly in denying Toll the right to prorate to the extent of his interest coupons that had not matured.
Counsel for Toll cite many cases to sustain the following statement of the law, quoted by them from 9 C. J., p. 49: “Interest coupons payable to order or to bearer at a specified time and place, and which are attached to and represent the installments of interest accruing on a bond, are in legal effect negotiable promises for the payment of money, and when detached from the bond possess all the attributes of negotiable paper. Such coupons may be detached and negotiated separately by simple delivery, provided they are payable to order or to bearer; and this rule applies after the bond itself has been paid and satisfied as well as before. Coupons once detached and negotiated cease to be mere incidents of the bond and become independent claims, unless they refer to the bonds for their terms and conditions. The mere fact that coupons are declared to be for interest on bonds specified by their numbers does not destroy their negotiability when separated from the bond, nor impair the title of one purchasing from another without production of the bond. ’ ’ Be[535]*535ferring to the argument of Toll’s counsel, the attorneys for the bank pertinently say: “Their brief is a laborious and scholarly effort to show that the 1 per cent interest notes are valid negotiable instruments, and that the gold note holders can hold the maker personally liable at maturity. Well, what of it? Why argue that question? That does not give them security in the trust deed. ’ ’ An action to secure a personal judgment against the maker is one thing; a suit to foreclose a deed of trust, or to share in the proceeds of a foreclosure sale, is quite another thing. Counsel for Toll admit that if there were no interest coupons, or where, as in the case of the bank here, the interest coupons remain attached to the principal note, the holder, upon acceleration of the maturity of the indebtedness, would not be entitled to receive, out of the proceeds of a foreclosure sale, the amount of the unearned interest. In the present case the trial court allowed the bank matured interest, but not unmatured interest. Indeed, the bank did not claim the latter; if it had claimed it, the claim, of course, would have been disallowed. Not one authority is cited that sustains Toll’s claim to share pro rata in the proceeds to the extent of his unmatured interest coupons.
Each coupon contains this statement: “Being on account of interest * * * on a principal note No. 3458 for the sum of $6,000, which principal note and this interest note are secured by trust deed of even date herewith.” When one claims a lien by virtue of a deed of trust, he is bound by the provisions in the deed. The deed of trust involved in this suit contains the acceleration clause, quoted above, and also the following: “ * * * the public trustee, out of the proceeds or avails of such sale * * * shall pay to the beneficiary hereunder, or to the legal holder of said notes, the said principal note or notes without priority, whether due and payable by the terms thereof or not, with accrued interest, rendering' the overplus, if any, unto the said party of the first part * * Counsel for Toll argue that the words “or [536]*536notes” mean interest notes. We do not think that such was the intention of the parties. Sometimes there is but one principal note, at other times there are several principal notes, secured by a deed of trust. The form of trust deed before us evidently was designed to be used in either case. In other parts of the deed of trust we find these expressions: “* * *' is desirous of securing the prompt payment of said promissory note [referring to the principal note] and said interest notes”; “in case of default in the payment of the said principal or interest notes ’ ’; and again, “said principal or interest notes.” In several places, where it is obvious that the principal note and the interest notes are referred to, we find: “the notes secured hereby”; “legal holder of said notes”; “the notes hereby secured”; again, “holders of said notes”; “the said notes and interest”; “on or against said notes.” Whenever the interest notes are intended to be referred to, the intention is clearly expressed. If it was the intention to require payment of the interest notes, whether due and payable by the terms thereof or not, the parties would have used apt words to express such intention; for example, “the said principal note and the interest notes,” or “the said principal and interest notes,” or “the notes secured hereby.” The use of the word “or,” in the provision in question, is significant. If the word “interest” were inserted between “or” and “notes,”- as Toll’s counsel, in effect, say should be done, the public trustee would be directed to pay to the legal holder of “the said principal note or the interest notes” — that is to say, to the holder of either the principal note or the interest notes — “without priority, whether due and payable by the terms thereof, or not,” etc. Such a construction is inadmissible.
Toll is not entitled to prorate with the bank to the extent of his unmatured interest coupons.
3. The principal note provides; “ * * * if any or either of said interest notes or any part thereof shall remain unpaid for ten days after maturity, it is expressly [537]*537agreed and understood that the legal holder or holders of this note may at their option, and without notice to the maker, declare the said principal sum to he due and payable.” It provides, also: “After maturity and default in the payment of the principal the same shall draw interest at the rate of twelve per centum per annum, until it shall be fully paid. ’ ’
The decree allowed the bank the penalty interest (twelve per cent per annum) from December 1, 1927. The interest note, concerning which there was a default, matured December 1, 1927. The principal, it is contended, could not be declared due until the expiration of ten days from that date. But, as we already have stated, there was a breach of the agreement to pay taxes that were due, and for such breach (which occurred September 16, 1927) the bank had the option to accelerate the maturity of the indebtedness, which option it exercised. The assignment of error based upon the allowance of interest cannot be sustained.
4. The decree allowed Toll reasonable attorney’s fees, but did not provide that such fees shall be paid before the payment of the principal and interest. The deed of trust provides that “the public trustee, out of the proceeds or avails of such sale, after first paying * * ■*' attorneys’ fees, * * * shall pay” the indebtedness. The decree is hereby modified so as to give effect to this provision.
As modified, the judgment is affirmed.
' Me. Justice Adams, Me. Justice Mooee and Me. Justice Bueke dissent.