Still reeling from Hugh’s confession that he loves her, Rachel is asking herself if she loves him too. Against Martha’s advice, Hugh presses Rachel for an answer, but unable to betray Kim, Rachel lies to Hugh that she doesn’t love him. Hugh is heartbroken and turns to Martha for a shoulder to cry on. Rachel misreads this as something deeper, and finds herself overcome with jealousy.
Concerned about Lucas, Jack confronts Naomi over her actions, asking her to resign from the school, to give Lucas a chance to get on with his life. At first, she’s unrepentant, but finally accepts Jack’s point. But just as she’s about to resign, Brad offers her a full-time position at the school, and she accepts. When Jack finds out, he takes matters into his own hands, telling Brad and Sally about Naomi’s affair with Lucas.
Colleen is crushed when she discovers Madge Wilkins has won her competition and been awarded the position of historian for the Coast News. But when Alf discovers Madge’s entry was inaccurate, Colleen wins by default and is so over the moon, she ends up roping Alf in as her new assistant.