It's 1934, and Sarah Burton, the new headmistress of Kiplington Girls High, is returning to her native, conservative northern town, bringing fiery determination to empower her girls and yank the sorely outdated school into the future. But everything from her fashionable ensembles to her anti-war sentiments and modern ideas attract the disapproval of the stern, brooding landowner, Robert Carne, who doggedly clings to a vanishing way of life even as the past tightens its malicious grip on him. Oppressed by overwhelming debt — and his absent wife's portrait hanging in the estate he can no longer afford to upkeep — he is forced to send his beloved but unstable daughter, Midge, to Kiplington Girls High, where again, he crosses swords with Sarah.
The Depression has hit hardest in the local slums, the Shacks, where Sarah's other standout student, Lydia Holly, is trying to overcome the squalor that surrounds her. A development scheme to provide sanitary housing, advocated by Sarah's ally and admirer Joe Astell, pits him against the reactionary Carne. But Carne's animosity toward Sarah is alleviated, however temporary, when the two share an exhilarating, intimate encounter at the very boundary of life and death.
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When the modern-thinking Sarah Burton arrives in a depression-era Yorkshire town to interview for the position of headmistress at Kiplington Girls High, she immediately clashes with the brooding town councilor Robert Carne. A landowner and an officer in the Great War, he bridles at her overt pacifism and determined embrace of the future. Still, the other town councilors, particularly the socialist reformer Joe Astell, award her the position based on her qualifications and feisty nature.
Mrs. Beddows, another councilor and a confidant of Robert, urges him to send his daughter, Midge, to school, but he protests, calling her a "special case." Indeed, the highly-strung, unstable girl has worked herself into a panic during Robert's brief absence, fitfully dressing up as a macabre version of her mother, whom she desperately murmurs that she must "bring back." Robert soothes the girl but remembers an incident with her mother, Muriel, when he followed her to a rooftop during a party. Singing and flirting, the beautiful woman perched herself on the parapet and dared the young Robert to save her from jumping even as she forced him to vow that he would never leave her.
Attending her students' dance performance at Mrs. Beddows's suggestion, Sarah is overwhelmed by emotion during their rendition of "Keep the Home Fires Burning" and steps out. When Joe Astell joins her, she reveals that she'd lost her fiancé in the war. Joe in turn reveals that he was gassed in the war, and proposes that theirs and others' losses are all the more reason for them to try to make the world a better place.
Town councilor and man of the cloth Alfred Huggins delivers a rousing sermon against poverty, particularly that in the local slums, the Shacks. The land developer and fellow councilor Anthony Snaith, approving of the sermon, invites Huggins to join him to talk about a scheme to replace the Shacks with a new development. But Huggins chooses temptation, sneaking away for a rendezvous with prostitute Bessy Warbuckle.
Sarah welcomes two new students to the school: a gifted resident of the Shacks, there on scholarship, Lydia Holly; and Midge Carne, Robert's daughter. When Sarah treats her students to a game of Hare and Hounds on the cliffs, she doesn't know that a foxhunt is in full flight across the landscape. In the thunder of hooves, horns and barking dogs, Robert's prize stallion, which he is desperately hoping to sell, trips on a wire, is injured, and has to be destroyed. The horrified girls witness the tragedy and Robert lashes out at Sarah and takes his daughter home with him. Later, on the phone, he asks for more time to pay his debts. He breaks a pill open into his handkerchief and inhales, imagining Muriel on the magnificent stallion.
Lydia shines during a poetry exercise, her brashness suspended as she reads aloud from her work. But returning home from school, she finds her mother violently ill from a poison she'd taken to rid herself of a desperately unwanted pregnancy. She stays in the squalid room with her mother.
Bessy too is pregnant, as Huggins discovers when the prostitute arrives at his door with the extortionist Reg Aythorne. Reg is going to marry Bessy, but he threatens to reveal Huggins as a hypocrite if he doesn't pay them. Higgins protests; he doesn't have the money.
Meanwhile, Sarah has visited her fiance's grave and is on her way home when her car runs out of gas. Walking through the darkness, she hears the distressed moos of a cow and investigates to find that she is at Maythorpe, Carne's ancestral home, and the distressed sounds are coming from a laboring cow whom Robert is trying to help. Entering the stable, she offers to help, and in spite of Robert's scorn he needs her — the calf's head is stuck. After a physically grueling, intense and intimate interlude, they deliver the calf. The skies open up and it begins to storm, so they make their way inside to a fire and drink. But Muriel's imposing portrait hangs for all to see, and the tenuous moment of kinship, even attraction, is broken. Robert shows Sarah her room and is gone before she awakens in the morning.
He makes his way down the corridor of a psychiatric hospital, hat and flowers in hand, to a locked ward where there waits a patient, his wife, Muriel.