COURT OF APPEAL FOR ONTARIO

DATE: 20050513 DOCKET: C41951 and C42502

BEFORE: MACPHERSON, SHARPE and JURIANSZ JJ.A.

BETWEEN:

CANADA TRUSTCO MORTGAGE COMPANY Plaintiff (Respondent)

• and -

NANCY PIERCE, ESTATE TRUSTEE OF THE ESTATE OF TERRENCE DAVID PIERCE, DECEASED Defendant (Appellant)

AND BETWEEN:

NANCY PIERCE Plaintiff (Appellant)

• and -

CANADA TRUSTCO MORTGAGE COMPANY Defendant (Respondent)

COUNSEL: Harry Underwood for the respondent Harvin D. Pitch and William H. Levitt for the appellant

HEARD: February 18, 2005

On appeal from the judgments of Justice Colin L. Campbell of the Superior Court of Justice dated May 20, 2004 and October 5, 2004.

MACPHERSON J.A.:

A. INTRODUCTION

[1] Terrence Pierce ("Pierce") was an investment counsellor. On May 19, 1999, he and his wife, the appellant Nancy Pierce, entered into a loan agreement with the respondent Canada Trustco Mortgage Company ("Canada Trustco") in the principal amount of $775,000 for a five-year