At the fountain, the king hears a case concerning a girl who has married a penniless man, and whose property is being held by the Church.
The king rules in favor of the Church.
Arthur has sped up the development of his army, which takes the Yankee by surprise, so he suggests that he deliver a "sharp and searching examination" for every officer. The king agrees.
The first candidate is examined. The examination board wants to dismiss him because he's a weaver's son, but Hank the Yank allows him to demonstrate a wide array of knowledge.
A second candidate—this one a noble—is examined. He can't read, write, or perform basic arithmetic, but qualifies because he can trace his noble line back four generations. The Yankee's candidate is dismissed.
If that's the way it's gonna be, then the Yankee's got a way around it: he suggests creating a King's Own regiment consisting entirely of noble officers… leaving the rest of the army to commoners. The king agrees.
The Yankee arranges the regiment to include all kinds of perks—provided those who join renounce their royal grant (a herald and shield).
Noble sons can join the regiment automatically… which essentially wipes out the royal grant within two months.