With his continued influence over Emma, Charley upsets the family. After the bank calls in its loan, Richard saves Falcon Crest from Michael Sharpe. Encouraged by his sister-in-law, Genele Erickson, Frank Agretti goes to the bank with the power of attorney which Angela had given him prior to her aborted trip to Europe and takes over operation of Falcon Crest.

As Michael Sharpe arranges for Richard to be killed, the contract eventually goes to Sal, Richard's acquaintance from prison. Instead of killing Richard, Sal offers to help him get back at Sharpe, but later pays with his life when Sharpe learns that Sal double-crossed him. After Sydney defies her husband and befriends Emma, Ian beats her. In order to get rid of Lance, Charley shows him a videotape of Pilar's liaison with Ned Vogel. Despite Pilar's pleas, Lance leaves enraged, just as Charley had hoped.

When Genele forces Frank out of his own home in order to entertain her lover Sharpe, Frank delivers the remains of Genele's sister and Frank's ex-wife Renee to the police, informing them that Genele killed her ten years before. Sydney tries to push Pilar and Lance back together. Sharpe is displeased when Lauren moves in with Richard after her ordeal with Walker. Sharpe tries to act as a business mentor for Danny.

Richard and Sharpe search for Lauren, who had grown tired of their fighting and ran off to work as a waitress in a diner. Sharpe attempts to convince Danny to drop Sydney, who wants Falcon Crest to return to the Channing's. When Lance and Pilar ask Sharpe what it would take for him to sell them Falcon Crest, Sharpe tells them to break up Sydney and Danny. When Lauren returns to Richard and the boys, she has to deal with Richard's continuing obsession with his dead wife Maggie.

Danny has a severe head injury as a result of crashing Sydney's car, which Sharpe had tampered with to get at Sydney. Danny's mother, Anne Bowen, and Sharpe decide to approve a dangerous operation to remove a bone shard from Danny's spinal cord. Discouraged by the bad luck she seems to bring to all her boyfriends, Sydney leaves Falcon Crest. Suspecting that Sharpe was behind the car accident, Richard and Lance track down the auto mechanic, Sacco, who did the tampering. Alerted to Richard and Lance's involvement, Sharpe sends his chauffeur Nick to ensure that Sacco doesn't talk.

Lauren tries to persuade Anne to reconcile with Sharpe. Anne and Lauren work to create an understanding between Sharpe and Richard, but once the women leave, Sharpe and Richard each vow to find the mechanic Sharpe hired to tamper with Sydney's car. Pilar disguises herself as a homeless woman to win the trust of Sacco's girlfriend, who leads Pilar to Sacco. Sharpe's henchman, Nick, follows both of them. However, when Nick is about to shoot Sacco, Lance disarms him from behind. With the informant they need to wrest Falcon Crest from Sharpe, Pilar and Lance call Richard.

Richard knows that Sharpe was behind the sabotage that almost killed his son, Danny, and he has Johnny Sacco, the mechanic paid to tamper with Sydney's car, to prove it. In order to keep Danny and his estranged wife Anne from knowing his involvement in the accident, Sharpe transfers ownership of Falcon Crest to Richard. After Anne agrees to give her marriage with Sharpe a second chance, she changes her mind when Johnny Sacco arrives intoxicated at the Sharpe residence and tells Anne everything. Anne lets Sharpe in on a secret she's kept for 21 years: Richard is Danny's real father. After several months in a coma, Angela revives.

After Danny learns that Richard is his father, he goes to Sharpe to tell him it doesn't matter, but Sharpe throws him out of his office and tells him that they should go their separate ways. Because Danny has no job and nowhere to live, Lauren invites him to live with her and Richard, but Richard wants nothing to do with Danny. After witnessing this callous side of Richard, Lauren considers calling off their wedding. When Danny threatens suicide, however, Richard and Sharpe agree to help him, which reassures Lauren. With the wedding back on schedule, Angela must find another way to stop it.