Claymore brings a stranger to look at the house who claims he is a student of architecture and wants to take photos of the house. When he comes back to the house after the Muirs leave for the evening Captain Gregg thinks he's a burglar and tries to scare him away, not realizing that he is actually a parapsychologist who is determined to find the ghost of Gull Cottage and make him known to an unsuspecting public.
With the house badly in need of repair, Carolyn tries to play off Claymore's vanity by telling him that a national magazine wants to do a photo shoot of Gull Cottage and if he could attend to some of the work that needs done it would be much more impressive. The Captain finds her plan amusing and bets her $5 dollars that Claymore will not do the repairs, but when it appears that he really won't fix the necessary items, the Captain comes up with a brilliant scheme of his own.
Carolyn Muir, a young widow from Philadelphia, moves into Gull Cottage on the coast of Maine with her two young children, family dog, and housekeeper. Unknown to her Gull Cottage is already inhabited by the ghost of the former owner Captain Daniel Gregg, a charming but somewhat aggravating ghost who is not sure if he wants this family in his home.