Mr. Edwards keeps Matthew at his place, but Nancy Oleson tells on him. A judge comes and rules that Matthew be placed in an institution. Then Mr. Edwards makes a statement that everyone is crazy sometime. He convinces the judge to allow the boy to stay with Mr. Edwards.

The people of Walnut Grove are at first excited when the railroad wants to build through the town. This excitement doesn't last long. The railroad tells several people that they must leave their houses. The people make a stand at the Carter's place. This delay in building convinces the railroad to find a different route.