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Ramon Castillo, an old enemy of Don Diego's, arrives from Spain and tries to steal the army payroll from Sgt. Garcia. Though thwarted by Zorro, he recognizes the fencing style as Diego's and tries to convince Sgt. Garcia that Diego is Zorro. It is only with great difficulty - and Bernardo's help - that Zorro manages to decisively beat Castillo in a swordfight while Diego appears to be safely locked up in a jail cell.