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Upon returning to New York from a December holiday in Lake Placid, Johnny Case drops by to see his dear friends, Nick and Susan Potter, and gleefully informs them that he has become engaged to a beautiful woman he met at the resort. When Susan questions Johnny about his bride-to-be, Julia Seton, Johnny confesses that he knows nothing about her background or family life. Later, when he shows up at Julia's Park Avenue address, he is stunned to discover that she is the daughter of Edward Seton, an extremely wealthy banker. While Julia goes to church to break the news of her engagement to her conservative widower father, Johnny spends time with Linda, Julia's unconventional, outspoken sister, and Ned, her alcoholic but charming brother. As he and Linda chat in the playroom, the only "human" room in the Seton mansion, Johnny proudly tells Linda about his dreams and aspirations. The thirty-year-old Johnny reveals that because he has worked hard ever since he was a child, he now feels that he should take a long-term holiday and discover the true meaning of life. In turn, Linda confesses that because of their father's domination over the years, both she and Ned have been unable to find their place in the world. Mr. Seton, meanwhile, is stunned by Julia's announcement and immediately questions her about Johnny's financial standing and background. However, after meeting Johnny and drilling his employer about his competency, Mr. Seton agrees to the marriage. Although Linda, who adores her sister, suggests that they hold a small, informal engagement party, Julia willingly bows to her father's desire to have an enormous New Year's Eve party. Deeply disappointed, Linda refuses to come down for the lavish affair and holes up in the playroom. The Potters arrive and, while wandering around the mansion, accidentally end up in the playroom with Linda. Embarrassed by Linda's obvious absence from the festivities, Julia sends Johnny to fetch her, and Johnny is delighted to be reunited with his wisecracking friends. At the same time, Julia's snobbish cousins, Seton and Laura Cram, track Linda to the playroom and interrupt the group's fun. Just as Linda and Johnny, who loves to do backflips, are about to demonstrate a tumbling trick they have just perfected, Julia and Mr. Seton burst into the room and insist that Linda join the party. Mr. Seton then offers Johnny a job at his bank, forcing Johnny to reveal his "early retirement" plans. Both Julia and her father are upset by Johnny's pronouncements, and a despondent Johnny sees the New Year in with Linda. Later, Linda tearfully confesses to Ned that she has fallen in love with Johnny but intends to hide her feelings. Immediately after the engagement is announced, Johnny leaves the celebration without saying goodbye. Days later, Linda, anxious to reunite the lovers, visits the Potters and learns that Johnny is planning to sail with them to Europe that night and has asked Julia to join him. When a telegram from Johnny arrives announcing that Julia has turned him down, Linda rushes back home to admonish Julia. After the sisters argue about the situation, Mr. Seton joins the discussion and decries Johnny as "un-American." Julia smugly predicts that Johnny will return to her, and moments later, a contrite Johnny shows up and tells Mr. Seton that he is willing to work at his bank on condition that he can quit after two years if he is unhappy there. When Mr. Seton begins to plan the honeymoon in detail, however, Johnny balks and, after revealing that he loves his freedom more than he loves Julia, leaves for the dock. Linda then senses that Julia is actually relieved by Johnny's departure and forces her to admit that she no longer loves him. Inspired by Johnny's defiance, Linda declares her own independence and rushes from the house. At dockside, the Potters are overjoyed when Johnny boards the ship without Julia, and Johnny is delighted when Linda takes her sister's place by his side.