Candy is waiting for Annie's letter and each time the postman Mr March comes to Pony's Home, she annoys him forcing him to show the letters in his bag with the help of the other children of the orphanage.
At last, one night Mr March brings a letter to her ; he explains that he didn't bring it in the morning as he didn't want her to cry in front of everybody and be ashamed of it.
In the letter, Annie tells her how happy she is with her new family in her new house. Candy is very happy for her friend and they write each other for a while. But one day, Mrs Brighton asks Annie to stop her letters to Candy ; everybody thinks that Annie is the daughter of a family member and it would be a scandal if they know that she grew up in an orphanage.
Annie obeys at her mother's wish and writes a letter to Candy. She tells her that it is her last letter and in order to be the Brightons' daughter, she should forget about Pony's Home. Candy is very sad and cries at Pony's Hill. Then she hears a music and a boy who wears the traditional Scottish clothes comes playing a bagpipe.
He makes Candy laugh and he says that she is much prettier when she smiles. Candy would never forget those words.
Suddenly Annie's letter flies away and Candy catches it. But when she looks back at the boy, he isn't there anymore. She finds his brooch and keeps it. As she doesn't know his name and he was like a prince, she calls him "the Prince of the Hill".
On her way back to Pony's Home, she meets a woman with her daughter. The woman wanted to leave her daughter at Pony's Home in order to work but she changed her mind as she didn't want to bother Miss Pony with more children.
Then John comes to say that Miss Pony called Candy. When Candy goes back to Pony's Home, she sees a car in front of the orphanage and a brooch on it which looked like the one her Prince left behind.
Candy is happy thinking she can see him again. In the orphanage, she meets Steward who came to take her to the Leagons' house.
Steward explains that the Leagon family is a rich family in Lakewood, which isn't far to the city where Annie lives. Candy asks him if the family has a son, thinking about her prince, and Steward says yes. Candy accepts going with him surprising Miss Pony and Sister Maria. Candy leaves the house and runs to the woman she met before. She says that now she can leave her daughter there as a lucky girl of the orphanage has just been adopted by a rich family and will go near the city where her best friend lives...