Welcome to Verrières, a cute little town filled with white houses and chestnut trees. There are a lot of sawmills in the area (and a lot of peasants running them).
There's also a nail factory that belongs to the town's mayor, Monsieur de Rênal.
We get a description of Mr. Rênal, who's a respectable-looking dude with a long, proud family history.
We find out that Rênal has a relationship with an old peasant named Sorel. He had to buy out the peasant's sawmill in order to expand his garden terrace and keep any ugly mills out of the way. Sorel agreed to move his business, but only after he got a bunch of money out of Rênal.
The narrator closes the opening chapter by saying that the town of Verrières is totally tyrannized by public opinion.
In other words, there's a lot of gossip and a lot of judgment in the town. If you have a good name, that's great. But if you have a bad name, no one will treat you well.