When Mr. George consults his assistant Phil Squod about a letter from Grandpa Smallweed, Phil Squod doesn't heistate to disparage Grandpa Smallweed, calling him, by turns, a leech, a snake, and a "lobster in his claws." The letter concerns the loan Mr. George had secured from Grandpa Smallweed for the sake of starting up the shooting gallery business. It's a loan Grandpa Smallweed now intends to collect even if it means harassing Matthew Bagnet (and his family) who, acting as Mr. George's surety, had co-signed the loan.
Presently, Mr. and Mrs. Bagnet arrive at George's Shooting Gallery. They have come to settle the matter about the loan though their understanding of it is that the Bagnets won't be held liable. When Mr. George apprises them of the bad news, Mrs. Bagnet laments on behalf of Mr. George, saying how if Mr. George had settled and married Joe Pouch's widow that none of this business with the loan and the shooting gallery would have come to pass. But not for long. Mrs. Bagnet has faith that Mr. George will do what's necessary and have the matter settled before long. With that, Mrs. Bagnet returns home, leaving her husband with Mr. George for the sake of assisting the latter in having the matter settled.
Subsequently, Mr. George and Mr. Bagnet repair to the Smallweeds' residence. There Mr. George makes his case but to no avail. Shattering his pipe to smithereens, Grandpa Smallweed indicates the fate of his pipe as the fates that would befall Mr. George and Mr. Bagnet should they fail to pay off the loan. When Mr. George objects, Mr. Smallweed advises them to go see Mr. Tulkinghorn, Mr. Smallweed's legal adviser in the case, before having them unceremoniously removed from the premises.
Undaunted, Mr. George and Mr. Bagnet repair to Mr. Tulkinghorn's office where they are made to wait interminably. An hour passes and then some when Mrs. Rouncewell, Chesney Wold's housekeeper, emerges from her meeting with the lawyer. She surmises that Mr. George and Mr. Bagnet are military men and when told that they are former military men, she blesses them before bidding them farewell.
By and by, fed up with their persistence, Mr. Tulkinghorn admits Mr. George and Mr. Bagnet into his office. Mr. Tulkinghorn reiterates his moral objection to Mr. George who would harbor a criminal such as Gridley, and he makes it abundantly clear that no man is above the law when it comes to his obligation to pay off a debt when Mr. George stops Mr. Tulkinghorn in his tracks with a proposal. In return for having the Bagnets absolved from their legal obligation with regard Mr. George's debt, Mr. George will hand over to Mr. Tulkinghorn Captain Hawdon's instructions which Mr. George has in possession and which Mr. George had previosuly denied the lawyer from obtaining for perusal. Mr. Tulkinghorn agrees to the deal.
Later that evening, Mr. George has dinner with the Bagnets. Mr. George is, alas, in low spirits on account of giving up Captain Hawdon's instructions (and thereby posthumously betraying his friend). The Bagnets try to cheer him up. Mrs. Bagnet commends Mr. George for having settled the loan problem as she knew he would. Subsequently, Mr. George lectures the Bagnet's youngest Woolwich that his proudest boast when he grows up and his mother gets old is that he--Woolwich--hasn't been the cause for a single gray hair or wrinkle on his dear mother's head and face.