Unwilling to believe that Underdog is guilty of stealing the gold, Polly decides to try and find the real crooks. Her investigations lead her to an old, run down house in the countrieside. An old Civil War hermit warns the reporter that ghosts haunt the old house. Polly refuses to believe in such nonsense and heads for the old house to continue with her investigations. Polly enters the house and she meets a group of hideous specters. One leads her into a doorway that is actually an entrance into a bottomless pit. Our heroine falls in. In the meantime, Underdog has his day in court, and is found guilty. The judge sentences our hero to twenty years in prison.