Maree writes to mummy & daddy + head priest about being touched by Halia’s thugs. The next day, a dwarven ambassador, Barendd Fireshield, arrived at the House of the Rising Sun.
Suddenly, Phandalin is attacked by a dragon who decimates the constabulary; Daran Edermath dies charging the dragon while it was eating livestock. The heroes arrive in time to fight and drive off the dragon. The dragon damages much of the north west part of Phandalin and buildings up to Stonehill Inn. Rae calls for help with her Sending Stone and the Bonesplitter wolf-riders arrive about half an hour after the dragon is driven off. They help in the aftermath. The group rally the people to defend the town and urge them to build a wall and defense. However, there is a shortage of materials for building. Someone suggests that that Wester Harbin’s half-brother has a logging camp and they (with a mob behind them) convince Harbin to write to his brother to secure a supply of wood. At the same time, they will bring provisions to the logging camp.
Oohye gets Wester Harbin’s agreement to act as the guard captain and recruits some farmers (mostly those whose homes were destroyed during the dragon’s rampage). He appoints the most muscular farmer, Carric, as acting guard captain and passes him a fighting manual. They hear rumours of a dragonslaying sword hidden in the list Dragon Barrow tomb. They also decide that they need more information about the dragon in the city of Neverwinter.