Sum Chi and Kuan Wah use their newly acquired sword skills to kill Kay Shing, but yet fail to save Sum Hung. The Emperor Suen Chung issues an imperial decree announcing Kay Sum his successor. Kay Yuk appeases his brother so as to better cover his own ambitions.

Kuan Wah kidnaps Kay Yuk and uses him as hostage to exchange for Sum Hung. Kay Sum decides to use this opportunity to get rid of Kay Yuk.

Sum Chi and Kay Yuk have a friendly match which results in a draw. They develop mutual respect but feel helpless for belonging to opposite camps.

As the Emperor agrees to the deal, Sum Chi brings Kay Yuk to the meeting place to exchange for Sum Hung. Kay Sum has sent his men to ambush the place, equipped with explosives.