Katy makes an excuse to get out of going to schoolies with Jason and Patch. While away, Jason sleeps with the fun loving Sylvana. Katy rejects Mickey out of loyalty to Jason. John and Liz's attempts to prepare the locals for the launch of the book backfire. Sandra and Pete clash over his support of the book. Kim goes on 'Good Morning Warrigong'.

Liz dreams of her father, Harry, then learns he's on his death bed. Liz implores her sister Margaret to fly out from England. Satisfied that his two daughters are reunited, he dies peacefully. After an outpouring of anger and recrimination, Liz and Margaret make their peace. Mickey goes to visit Katy, behind Jason's back.

Pete gives Sandra a brand new car. Sandra refuses to accept the gift, until a visit to the country helps her realise that Pete's generosity is unconditional. John is won over by Pete. Infatuated with Mickey, Katy feels trapped in her relationship with Jason. Marissa tells Tom she refuses to be ordinary. Marissa attends a cattle call at a modelling agency.

Isabelle and Katy's trip to the city leads to an argument with Tom and Marissa. The new look Shelley is revealed, increasing Marissa's feelings of failure. After clashing with Tom, she packs up her market stall - for good. Katy and Mickey meet and are attracted. Jason agonises over Katy, and walks out on an important exam. Liz notices a potential problem with Little Derek.

Shelley says to Mickey 'I killed your Dad', and Mickey reacts with anger. Marissa appeals to John for help, and takes Shelley to the country. John counsels Shelley and makes her realise that she can get her life back on track. Realising she can no longer blame herself for Greg's death, she bids Mickey farewell. Jason and Kim spend an uncomfortable night at Patch's. Pete whisks Sandra away to a beach house, and they negotiate the tricky waters of sleeping together for the first time. With some help from Jennifer Anniston, Pip makes peace with Nick.

Marissa confesses her guilt over Shelley to Tom, and they track her down in the Cross. Shelley initially rejects them, then after a brief flirtation with heroin, turns up at the Steele house asking for help. Sandra pursues a relationship with Pete, but only after overcoming a few insecurities about age and glamour. John and Derek bond in the bush, where Derek reveals his fears of fatherhood. Bert helps deliver Eileen's baby boy which she promises to name after Bert!

Shelley phones Mickey and tells him to leave her alone. With some help from Nathan and Pete, Mickey's ode to Shelley is played on the radio. Marissa's market stall is an embarrassing failure, leading to conflict with Tom. Kim gets her braces off, but it's not the life changing experience she expects. Pip and Nick break up. Pete is exposed as 'The Love Professor', and Sandra as a thirty-something mum with two kids!

Shelley's working hard for the money. Mickey and Nathan, a friend of Shelley's father Trev, are on her trail. Scumbag returns with a Thai bride, who isn't what Patch expects. Nick picks a fight with Pip to avoid intimacy. At a nightclub, Sandra sees Nick flirting with a guy, then meets handsome and groovy Pete. Is it love in the first degree? John, blaming Les for baby Harry's death, is unable to help Angela.

Liz is steely in the wake of baby Harry's death, then finally releases her emotions after the memorial service. On the bright side, her father Harry agrees to have treatment for his cancer. Katy is upset by Jason's insensitivity, and tells Isabelle they are at different stages of maturity. Sandra learns Pip and Nick are an item. Marissa and Tom decide to live in the city. Shelley is revealed, working as a hooker. Mickey receives a visit from big Nathan. The Todd's and the Taylor's agree to swap homes - officially.

Tom and Marissa's relationship gets off to a passionate start. Liz and Kim go to the hospital to visit Harry. When doctors offer a grave prognosis, he refuses treatment. With encouragement from Isabelle, John tries to help Angela break free of her abusive husband Les. Cam loses his virginity to a charity worker. Marissa and Tom consummate their relationship. Liz is seriously injured when electrocuted by a faulty fridge.

John makes his first appearance on 'Good Morning Warrigong', and later cops a punch on the nose by an irate viewer. Pip and Nick get intimate, setting them on a path of unlikely romance. Cam strikes a deal with Kim over the book. Tom learns that Cam's book portrays him as a dimwit, and seeks Marissa's advice. When she assures him the portrayal is anything but uncomplimentary, they seal their attraction with a kiss.

In the aftermath of Shelley's disappearance, Sandra is forced to realise that she has been sadly neglecting the home front. Marissa and Mickey embark on a bold prison-visit to further the search for Shelley. Eileen and Liz attend pre-natal classes with hilarious and touching results.

Shelley wants to tell Mickey the truth about his father's death but knows this will destroy any chance of a future with him. The dilemma forces her to make an impulsive decision. Pip discovers the truth about Cam's 'female voice'. Liz's attempts to ease Eileen's fears about childbirth lead to Eileen inviting herself to attend the birth.

'Do-gooders' and 'naysayers' do battle for the future of John's neighbourhood centre. Riotous antics turn sour as Jason and Kim attempt to expose the secret of Bert's glamorous 'lady' friend. Mickey rails against Sandra's efforts to help him through his grief - and earns a surprise new housemate for his trouble.

Shelley is plagued with guilt over Greg's death. Liz wonders if she's set Bert Adams up with a trans-sexual. Pip learns that trying to turn a gay man straight isn't easy.

A debutante ball in Inverness brings together country and city. Isabelle introduces Tom to his father. Sandra and Greg have their final farewell. Shelly alows Greg to be stung by a bee, and is horrified by the consequences.

Crunch - time for the Todds and the Taylors when distressed Sandra announces a return to Inverness. Cam learns confronting lessons about life - and literature.

An emotional rollercoaster for Sandra in her pressure-cooker household, as lover boy Greg returns from his holiday with unexpected plans. Agony for Pip - and danger for Nick - when she inadvertently reveals details of boofy Bomber's love life. Crazy, touching moments as Eileen continues her struggle with valium withdrawal and meets her first homosexual.

Tom struggles with issues of self-esteem and identity, as he forges a new relationship with his mother. John confronts terrifying visions of a possible future as he assesses his decision to return to social work. Pregnant Eileen meanwhile decides to come off her 'nerve-pills', with distressing results.

In Allenhurst Cam recieves a phone call from a publishing agency requesting him to come in for an interview. They are unaware that he is only 16 but soon find out. After Toms declaration of love it is Sandra that opens the door. Marissa comes in but Sandra wants to talk to Tom alone. She then gets back to her sewing as Pip comes in saddened by the fact that her boyfriend bomber is gay Marissa tells Pip what Tom did and Pip thinks Tom is a romantic and is shocked that he actually did a thing like that. Sandra bids farwell to Tom making sure that they remain friends and nothing else.