OPINION OF THE COURT The appellant, Olga A. Martin, who is the surviving widow of Frank A. Martin, deceased, and the beneficiary in the policy of insurance herein referred to, instituted this suit against the appellee, New York Life Insurance Co., to recover judgment upon a policy of insurance issued by it upon the life of Frank A. Martin, under date of October 18, 1907, in the principal sum of $2,000, less the sum of $276, which is admitted to have been loaned to the insured during his lifetime.
The appellee admitted the issuance of the policy, and that all premiums thereon up to and including the year 1914 had been duly paid. It pleaded by way of affirmative defense that the annual premium due on October 18, 1915, was not paid; that, by the terms of the policy, it was extended for a period of three years, plus 329 days, which extended time expired about 7 days prior to the death of the insured, which occurred on September 22, 1919. The nonpayment of the premium referred to was denied by the appellant.
The case was tried by a jury, and at the close of the appellant's case, the appellee moved for a directed verdict in its favor, because the evidence showed that the premium due on October 18, 1915, was not paid, and that the policy had expired prior to the death of the deceased. This motion was granted and the directed verdict returned upon which judgment was rendered.
[1, 2] The appellant urges for a reversal of the case that the court erred in directing such verdict because she had made out a prima facie case, and had introduced evidence which formed an issue to be submitted to the jury. In this connection, appellant testified *Page 403 that she had delivered to her attorney a number of receipts for annual premiums paid upon this policy; her attorney testified that he had received from her the official receipt of the appellee evidencing payment of the annual premium due on October 18, 1915; that he had seen it and placed it in his safe; that it had been lost and could not be found. This evidence, standing alone, made out a prima facie case for the appellant, as there seems to be no dispute but that the policy was by its terms and provisions extended in force beyond the date on which the insured died, if the premium in question was paid. The appellee, to overcome this prima facie case, relies upon a certain check, which, it contends, was transmitted by the deceased to the appellee with which to pay such premium; that said check was not paid, but was returned unpaid by the bank upon which it was drawn on account of insufficient funds with which to pay it. The difficulty which surrounds the appellee is that the check is not contained within the bill of exceptions. What purports upon its face to be such check is to be found in the record proper, but not within the bill of exceptions. This check is but a part of the evidence, and cannot be considered by us unless it is brought here as a part of the bill of exceptions, duly authenticated by the certificate of the trial judge, his successor in office, or some other judge designated for that purpose as provided by law. Without such a certificate, there is no verity or authenticity to evidence, whether it be oral or written. Oliver Typewriter Co. v. Burtner Ramsey, 17 N.M. 354, 128 P. 62; Mundy v. Irwin, 19 N.M. 170,141 P. 877; Rogers v. Crawford, 22 N.M. 365,161 P. 1184; Cox v. Douglas Candy Co., 22 N.M. 410, 163 P. 251; State v. Wright (N.M.) 213 P. 1029.
The appellant offered in evidence part of a certain letter and desired to read to the jury only such portion so offered. The trial court held that, if she offered any part of it, the whole must be offered and read. This is assigned as error, but we cannot review the question, because the letter referred to is *Page 404 not contained within the bill of exceptions. What purports to be such letter is shown in the record proper, but not within the bill of exceptions. What we have hereinbefore said controls us here. The question is not reviewable, as the letter is not properly before us.
Other questions are discussed by counsel in their briefs; but the condition of the record does not present them for determination upon this appeal. Obviously, however, these will be presented to the trial court upon the subsequent trial of the case, and, as they are perhaps controlling, we think it best to discuss them for the guidance of the court and counsel as well as the profession generally.
Much is said by counsel with regard to the effect of payment of an annual premium by the personal check of the insured which is dishonored by the bank upon which it is drawn, and our discussion upon this subject will be predicated upon the assumption that the deceased obtained the official receipt of the appellee, evidencing the payment of the annual premium due on October 18, 1915, concerning which the appellant and her attorney testified, by transmitting to the appellee company his personal check, which was not paid by the bank upon which it was drawn, and was returned to the deceased by the appellee with a demand that such receipt be returned to it.
[3, 4] A contract of insurance like this one is one extending throughout the lifetime of the insured, and which matures upon his death, with the obligation then resting upon the insurer to discharge it by making payment in the sum and manner and to the person entitled thereto according to the terms of such contract. This obligation is conditioned upon the payment to the insurer of certain sums at fixed intervals. These payments are commonly denominated premiums, and their payments are necessary in order to bind the insurer to discharge its obligations imposed by the contract. The insurer has the right to forfeit and declare annulled the entire contract upon default *Page 405 being made in such payments. It has the further right to determine how and in what manner they shall be made. It may accept post office or express money order, bank draft, or the personal check of the insured as payment, and it may demand cash in settlement and payment thereof, but these are all rights of the insurer which may be waived by it. If it receives and accepts the personal check of the insured as payment of the premium due, and issues its official receipt evidencing such payment, it thereby waives its right to declare a forfeiture of the policy, even though the check is dishonored by the bank upon which it is drawn.
"Generally, it may be said that, where accepted as such, payment may be accomplished by the delivery to the insurer of a draft, and, where this is done, the effect of payment is not destroyed by the fact of failure of the drawer after the draft has been received by the insurer, or payment may be made by the delivery of the personal check of the insured if it is accepted as payment." 14 R.C.L. 964, 965.
Again it is said by another of the standard authorities:
"The application of this general rule to the payment of premiums is, however, subject to exceptions and qualifications, for a check, draft, or note, may be accepted under such circumstances as to clearly indicate that a payment of the premium was affected thereby, at least so as to continue the policy in force and preclude a forfeiture, and this is so held even though said check. draft, or note be not paid when due or be dishonored. Again, although the insurer has the right to demand cash in payment of a premium, it may waive such right and accept in payment notes, checks, or drafts, or any other thing of value." 2 Joyce on Insurance, 2256.
This rule has found its application in many cases where the insurer has written the insured, calling attention that the premium has either fallen past due, or will be due at an approaching date, and directing that he send a check or draft, as the case may be, which is done by the insured. It is almost universally held that, under such circumstances the right to declare a forfeiture upon nonpayment of such check or draft cannot be had because the insurer, by such directions, is held to have agreed to accept such commercial paper as payment and settlement of the *Page 406 premium due, and cannot thereafter be heard to assert its right so waived. 3 Cooley on Insurance, 2318; Penn. Lumberman's Mut. Fire Ins. Co. v. Meyer, 126 Fed. 352, 61 C.C.A. 254; MacMahon v. U.S. Life Ins. Co., 128 Fed. 388, 63 C.C.A. 130, 68 L.R.A. 87, Mutual Life Insurance Co. v. Chatanooga Savings Bank,47 Okla. 748, 150 P. 190, L.R.A. 1916A, 669, and the authorities cited in note appended thereto. Such directions merely constitute evidence that the check or draft was received as payment, which fact might be proven in other ways, by direct or circumstantial evidence. We note the leading contrary case of National Life Ins. Co. v. Goble, 51 Neb. 5, 70 N.W. 503, which holds that even though the insurer does direct the insured to remit by bank draft, which was done, and that the draft was not paid because the drawing bank failed before it reached the drawee bank, a forfeiture may still be exercised by the insurer, because no payment of the debt was thereby effected. This case, we think, is against the weight of authority, and we decline to follow it. This conclusion was reached by the Circuit Court of Appeals in MacMahon v. Insurance Co., supra.
[5] In connection with this subject, we think the mere delivery to the insurer of a worthless check or bank draft, which is dishonored when presented for payment, in the absence of any fact or circumstance indicating an agreement on the part of the insurer to accept it as payment of the premium then due, does not operate to waive the right of forfeiture upon its nonpayment, as the general rule of commercial transactions is that the receipt of such a check or draft is predicated upon the implied understanding that it will be paid. Veal v. Security Mut. Ins. Co., 6 Ga. App. 721, 65 S.E. 714; Fidelity Mut. Life Ins. Co. v. Click, 93 Ark. 162, 124 S.W. 764.
[7] And before leaving this subject, we travel out of our way, perhaps, to say that courts never favor a forfeiture. This rule applies in a case where the insurer attempts to escape liability upon the theory of a forfeiture for nonpayment of premiums. So that *Page 407 very slight evidence will suffice to support a finding that a waiver of the right of forfeiture has occurred. 1 Joyce on Ins. 574; 3 Cooley on Ins. 2259; Mut. Life Ins. Co. v. French, 30 Ohio St. 240, 27 Am. Rep. 433; Lyon v. Travelers' Ins. Co., 55 Mich. 141, 20 N.W. 829, 54 Am. Rep. 354.
[6] And the fact that the insurer, upon receipt of the personal check of the insured, issues and delivers its official receipt, by which it declares in writing that the premium such check is tendered in payment of has been actually paid, so strongly indicates that it did receive such check as payment, that the burden would rest upon it to show otherwise. Such a rule necessarily arises from its written admissions contained in the receipt. It would necessarily bear the further burden of showing that such check was presented to the bank upon which it was drawn, and that its payment was refused. So that if the appellee received and accepted the check of the deceased as payment of the prmium due on October 18, 1915, its right to forfeit for nonpayment of premiums did not arise until default had been made in the payment of the next annual premium due.
The last question discussed by counsel, and which we deem necessary to express our views upon, is the date upon which the policy became effective. It is dated November 16, 1907. It provides:
"In consideration of the sum of seventy-three dollars and ten cents, the receipt of which is hereby acknowledged, constituting payment of the premium for the period terminating on the eightenth day of October, nineteen hundred and eight, and in further consideration of the payment of a like sum on said date, and thereafter on the eighteenth day of October in every year during the continuance of this policy, until premiums shall have been paid for fifteen full years from October 18th, nineteen hundred and seven, or until the prior death of the insured. * * * This policy takes effect as of the eighteenth day of October, nineteen hundred and seven."
[8] From the quoted provisions of this policy, it is to be observed that, by the terms of the contract agreed upon by the parties, the first premium paid extended the policy until October 18, 1908; that on that day the second premium should be paid; and that *Page 408 payment of all subsequent premiums during the 15 years such premiums were required to be paid should be made on that day and month. The policy is positive, unambiguous, and free from doubt with regard to the dates upon which the premiums shall be paid. It further expressly provides that it shall be effective from October 18, 1907. The parties had the right to so agree if they chose so to do. There is nothing in the policy which provides that it shall become effective at a subsequent date, nor that it shall not become effective until delivered; there is nothing contained within it which indicates that they had any other idea or intention the not agree that all subsequent premiums should be paid on October 18th of each year until it had been fully paid out. There is no question of inconsistent provisions of the contract, for they all harmonize. Appellant argues that this construction results in the deceased securing protection under such policy for a term less than a full year in consideration of first premium paid. We may for the moment concede this to be true, and yet it does not affect the terms of the policy with regard to the dates upon which the insured agreed to pay his annual premiums. The policy recites that the sum so paid constituted payment of the premium for the period terminating October 18, 1908. The parties so agreed, and for us to hold otherwise would result in making a new and different contract from that to which they agreed, which is neither the function nor practice of the courts. In the absence of fraud or mistake, neither of which is charged, the plain terms of the policy should be given effect. We are therefore of the opinion that, by the terms of the policy, it became effective October 18, 1907. Tibbitts v. Mut. Ben. Life Ins. Co., 159 Ind. 671, 65 N.E. 1033; Rose v. Mutual Life Ins. Co., 240 Ill. 45, 88 N.E. 204.
From what we have said, it appears that the appellant had made out a prima facie case at the time she rested; that nothing appears in the record to overcome or even controvert the same; hence it necessarily follows that it was error to instruct a verdict against *Page 409 her. The judgment must therefore be reversed and the cause remanded with directions to award her a new trial, and it is so ordered.
PARKER, C.J., and LEAHY, District Judge, concur.
On Rehearing