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Samuel does not let sentiment cloud his father's death, proposing to Letty that her mill-workers make bed linen which he will sell through a catalogue for his store, though Letty drives a harder bargain than he had imagined. William is shocked to learn that the 'Indian Queen', a Frazer ship which he chartered to a Mr. Lillie without his parents knowing, was deliberately sunk ,with loss of life ,for the insurance money. James has his suspicions but, even with the use of a diver, cannot proved that the cargo was never loaded.