A chance encounter with greatness goes to Mrs. Thackeray's head, and in turn annoys Rose, who, fed up with her pretensions, unleashes an insult so great that it sparks a feud. Yet despite the embattled cook and housekeeper, the downstairs staff is united in their love and nurturing of the child Lotte, who appears to need more help than they can provide. With even more than her customary authority, Maud steps up to take charge, whisking the child away for treatment even as she guards a secret of her own.
Preoccupied with the abdication crisis, Hallam attempts to buy some time from the press by hosting a special dinner for the Duke of Kent, placing 165 Eaton Street in the center of the monarchy's storm. Now preoccupied, Agnes has abdicated her responsibility of Persie, who has snapped the long leash her sister provided, and begun engaging in behavior that threatens to taint them all. Only Lotte's absence galvanizes Hallam to bring light into his home, purging it of dishonor and dark secrets that have been hidden for too long. But just as the king charts his fate, a momentous event will change the Holland family forever.
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Warning: Contains significant plot spoilers
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Warning: Contains significant plot spoilers
Upstairs at 165 Eaton Place, a very pregnant Agnes contemplates impending motherhood, while downstairs the servants lavish care on Lotte, the daughter of their recently deceased coworker Rachel. Lotte hasn't spoken since her mother's death. Despite initial misgivings, Agnes has accepted Hallam's decision that Lotte is their responsibility until her relatives in Germany can be found. But the presence of a disturbed child seems a bad omen to her — as does a family picture she finds showing Hallam as a boy with his baby sister, Pamela, who died in childhood. This is something Maud, Hallam's mother, won't discuss.
In another part of the house, Persie continues her secret late-night trysts with the chauffeur, Harry, while during the day she cultivates the amorous attentions of the new German ambassador, Joachim von Ribbentrop. Harry has given up his fascist views out of contrition for Rachel's death; but Persie has not.
In an incident that has surprising repercussions, society photographer Cecil Beaton arrives to take portraits of Agnes and Persie. During a break he meets Mrs. Thackeray, who has wandered upstairs from the kitchen to see his elegant props. Beaton gallantly indulges her interest by making a portrait of her, which she later receives in the mail. Overcome with vanity, the cook displays it prominently, and Rose retaliates by confiscating the picture, initiating a feud between the two senior servants.
Meanwhile, all of Britain is astir over King Edward VIII's intentions regarding his mistress, Mrs. Wallis Simpson. The king's youngest brother, the Duke of Kent, asks his old school friend Hallam to host a dinner for a British newspaper magnate who is a confidante of Mrs. Simpson. At dinner, the duke persuades the magnate to relay a message to Mrs. Simpson, while also keeping the story out of the press. The desired result is that Edward will reconsider his determination to abdicate and marry the reviled woman.
Since Lotte's psychological problems continue, Maud, who seems to know a thing or two about psychiatric hospitals, takes the problem in hand and has the child committed, without consulting Hallam. Furious, Hallam finds the address among Maud's papers and goes to the institution, where he hands over his card and says, "I came to see a girl, who was brought here by my mother."
He is immediately directed to a room where he finds, not Lotte, but his mentally disabled sister Pamela, now grown up. Years earlier he had been told that she died. When he confronts Maud with her deceit, she calmly explains that Pamela needed professional help, and as a mother she only wanted to spare his grief at his sister's condition; besides, it's what people did back then.
On the night of Edward VIII's speech announcing his abdication for the sake of "the woman I love," events come to a head at Eaton Place: Persie tells of her imminent departure to be with her Nazi friends in Berlin; Agnes suddenly goes into labor and delivers her baby with help from Pritchard, who, as usual, is primed for any emergency; Rose and Mrs. Thackeray make up; and Johnny, the dismissed footman from a previous episode, is about to be given a second chance.
Come Christmas, the whole extended family is together — including the new baby, Hector; Pamela; and Lotte, who finally has something to say.