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Joshua Rigg Featherstone has sold the estate at Stone Court to Mr. Bulstrode.
Bulstrode has hired Caleb Garth to manage the estate for him, and the two of them are talking business. Caleb's about to leave when Mr. Raffles comes up the lane looking for his stepson, Rigg.
But when he sees Bulstrode, he calls him "Nick" (Bulstrode's first name is, in fact, Nicholas), and acts like they're old friends.
Caleb Garth is curious. After all, Bulstrode is a powerful, though not universally popular, person in Middlemarch and no one there knows much about where he came from before he moved there and married Mr. Vincy's sister years and years ago.
But Caleb is also discreet, and leaves Bulstrode to deal with Raffles on his own, instead of sticking around to eavesdrop.
After Garth leaves, Raffles goes on and on about how long it's been, and asks whether Bulstrode has "given up the London concern," and reflects that "the old lady must have been dead a pretty long while […] without the pain of knowing how poor her daughter was."
Bulstrode doesn't respond, and Eliot doesn't clear up the mystery of how Raffles knows Bulstrode.
Bulstrode tells Raffles that he's bought Stone Court, and Joshua Rigg Featherstone has moved away.
He agrees to allow Raffles to stay at Stone Court overnight, although he himself will spend the night at the house in town.
He tells Raffles that he'll come back the next morning to discuss whatever it is that Raffles wanted to discuss.
As he rides back to Middlemarch, Bulstrode worries about what Raffles could possibly want. It can't be good, and it brings up memories of the bad things he'd done in the past (but Eliot doesn't tell us what bad things).
The next morning, Bulstrode goes to meet Raffles at Stone Court.
Raffles pretends that he's come to Middlemarch to visit his "old friend," but it's clear that he's there for money.
His wife (Joshua Rigg's mother) has died, so he has no ties to keep him anywhere, and he says that he's thinking of settling in Middlemarch.
That's exactly what Bulstrode doesn't want, so he offers to give him money to stay away.
(Apparently he'd paid him a huge sum of money ten years before to move to America, which he did, but now he's back again.)
Raffles brings up the "old lady" again, whom Bulstrode had married, and says that he's "found her daughter and her grandchild."
Bulstrode doesn't like having his first wife mentioned, and changes the subject.
But Raffles won't allow the subject to be changed, and says that the daughter was a pretty girl, named Sarah…something. He can't remember the name of her husband, but it began with an L.
Later on, he remembers: Sarah's married name was "Ladislaw."
The family tree is complicated here, so we'll take a minute to explain: remember, back in Book 4, Chapter 37, that Will Ladislaw told Dorothea about his family. His mother, he said, had run away from her family, but had never told anyone why.
Well, apparently she's the Sarah Ladislaw in question.
Her mother had gotten married to Bulstrode either before or after she disappeared, and Raffles knows about it.
But he doesn't tell anyone the name; he likes having secrets, because he can use them to make Bulstrode pay him to keep quiet.
Raffles agrees to go away for the sum of two hundred pounds (quite a lot of money back then).