To protect his master, Alf tells Sir Ralph that Lord Meldrum was wounded in the Artillery. Ivy is over the moon when James agrees to take her to the pictures. Mrs Lipton is convinced that Alf's divorce is being held up by his wife.

Excitement runs through the household when it is announced that the King and Queen of Dalmatia are coming to dinner, although Mrs Lipton is upset to find that she will not be doing the catering. In addition, Noel Coward is expected to join them after the opening night of his new play.