One year has passed; Whyhope has fallen into catastrophe having been hit with drought, bushfires and floods, and to make matters worse, the hospital is under lockdown due to discovery of asbestos, while patients have been evacuated and relocated to the local veterinary hospital. Adamant that the hospital will remain closed, Hugh decides to return to Sydney. Charlie and Matt return from Germany when they discover that the Brewery has received negative reviews online. Hayley learns that it was Charlie who wrote the reviews, without Matt's knowledge, so that she could come home. Sharna Bahit arrives in Whyhope when the town is under investigation for corruption, and announces her appointment as Council Administrator, dismissing the entire council. Betty visits Penny, where it is revealed that she and Jarrod have separated and that she is determined never to return to Whyhope. Hugh later runs into Penny when a patient is transferred to Stanwell Hospital and the pair have an altercation. Meryl is arrested for misappropriation of council funds. Hugh decides to remain in Whyhope until the town is back on its feet.

Meryl is desperate to avoid a prison sentence and uses any means possible to try and convince Sharna to lose all evidence connected with her corruption. Hugh and Sharna grow closer. Matt remains depressed over his return from Germany; Charlie later admits to him that it was she who wrote the negative reviews about the Brewery because she wanted to come home. Hugh and Penny clash over Kassie's palliative care when Kassie is discharged from Stanwell Hospital as she wishes to die at home with her family. Ajax employs new jackaroo, Tom, whom Hayley falls for at first sight. Penny realises she belongs in Whyhope following a conversation she had with Kassie and returns to assist Hugh at the clinic.

The Brewery hosts a fundraiser in memory of Kassie. Meryl is placed under curfew, but is however determined to attend the fundraiser in order to deliver an important speech. Penny begins to have doubts about her return to Whyhope. Sharna decides to dismiss Betty from the hospital due to cutbacks and leaves it with a reluctant Ken to break the news; before he can do so, Betty announces that she is leaving Whyhope for the Andes. Ajax begins gambling as a means to raise the money to build a family home for he, Hayley and Jimmy and therefore asks Tom to accompany Hayley at the fundraiser. The fundraiser evening almost ends in disaster when Kassie's daughter, Larry, causes an accident. Hayley puts her working relationship with Meryl to an end when she agrees to come and work for Sharna. Hugh and Sharna sleep together, as do Hayley and Tom.

Hugh and Sharna are now in a relationship but decide to keep it a secret. Following their one-night stand, Hayley struggles with her growing feelings for Tom. Ajax descends deeper into the world of gambling. A new intern secretary, Melody, begins at the hospital and is met with a mixed reception. It is announced that the hospital is to remain open, but there's a catch. Michael, an old friend of Meryl's, arrives in Whyhope to represent her when she is informed that she will most certainly serve a prison sentence; it is also discovered that he was the influence for Hugh's reckless behaviour as a teenager. On a night out, Michael has a health scare and Hugh sees the irresponsible side of Penny. Matt's plans to propose to Charlie are thwarted when she rushes to comfort a grieving Wes. Meryl and Michael band together in the hope of bringing down Sharna.

It's Father's Day and Meryl organises a special dinner in honour of Jim combined with what could be her last supper. Ken's parents arrive in Whyhope for which he reveals that he lied to them about being a doctor. Penny tries to help a patient who has attempted to take his own life. Matt discovers that Ajax is having money troubles. Hayley manages to break all ten commandments in one day and to make matters worse, Tom admits his love for her which prompts her to tell Ajax the truth after they almost sleep together a second time. Meryl and Michael stumble upon some incriminating information that could jeopardize Sharna's career, which Meryl lets slip at the family dinner, forcing Hugh to choose between his girlfriend and his mother.

The day of Meryl's court case arrives and upon realising that Hugh is in love with Sharna, she decides to back down against Sharna for which she is sentenced to 100 hours community service. Charlie questions Hugh on the possibility that Michael could be his father. Charlie is offered the position of Mayor of Whyhope. Ajax fires Tom when he discovers that his love for Hayley is mutual. Matt finally uncovers Ajax's secret gambling addiction. Sharna announces that she has been recalled to Sydney and wishes for Hugh to join her. The hospital makes a desperate attempt to see 110 patients in one day in order gain funding, however, when they fail to make the numbers, Penny reveals that she sabotaged the quota so that Hugh would stay, an action that she later regrets and admits her mistake. Hugh decides to leave Whyhope now that the hospital will be up and running again.

Ajax struggles to come to terms with he and Hayley's separation and he asks her keep it secret from the family for the time being. Charlie is appointed Interim Administrator of the council, much to Hayley's chagrin. Meryl agrees to go on a date with Michael and suddenly becomes frustrated with his desire to relive the past. Penny's son Floyd runs away from boarding school in Sydney and returns to Whyhope. Hugh sees that Floyd gets back to school when he, Sharna and Matt attend an event in Sydney; Hugh assists a cardiac operation, which is a success, while Matt is on business associated with the Brewery. Hugh soon feels embarrassed by Matt and the pair get into a fight. In an attempt to get back with Hayley, Ajax reveals his gambling addiction to her in the hope that she will see that they both made mistakes, but to no avail. Floyd goes missing again, but is later located and explains why he ran away. En route back to Whyhope, a bout of turbulence forces Hugh to reveal to Floyd his love for Penny. Upon landing, Hugh discovers that he has been offered a job in Sydney which he accepts.

Meryl and Michael are finally an item. Hayley takes into consideration that her separation to Ajax may have been too soon and that their problems may have been in the bedroom. Charlie is backed into a corner while trying to fulfill her duties to the council, she is faced with the pressure of committing corruption. Matt decides to turn down the offer of $2,000,000 so that Arcadia Brewery can remain a family business. Penny discovers why Floyd ran away from boarding school. Sharna is beginning to feel insecure about her relationship with Hugh and confronts Penny who tries to convince her that there is nothing between them. Hugh packs up and moves to Sydney. Matt and Charlie propose to one another and eventually get (re)married. Hugh returns from the city for the wedding and makes the surprise announcement that he has returned to Whyhope for good; he and Penny ultimately confess their love for each other. Meryl is now free as she completes her community service and she and Michael go for a carefree drive, passing the sign which reads "Thank You for Visiting Whyhope".