Ernie's adoption into the all-male Douglas household is threatened by a regulation that there must be a lady of the house. Steve again makes a request to adopt the child, but Misses Coulter and Miller of the adoption agency, say they are powerless to change the regulations. Miss Miller has a brilliant idea, however, and soon the family is appearing before a judge who decides that housekeeper Uncle Charley can legally be designated the 'lady of the house'. Charley approves if this fact is kept secret and Ernie is enthusiastically welcomed into the family.