Oliver Blackwood schemes to take over Matt's land. Frank Blackwood is jealous of his father's business dealings with Luke. Herbert arrives home with some local dignitaries to find Anita and Luke in a passionate embrace. The next day their liaison is all over town, and Anita arrives at the Mountain Ball on Luke's arm. Oliver Blackwood asks Anita to share his life at Balmoral, but before she can answer, a shot rings out and he falls to the floor.