- "Naughty goblins?"
"Yes, the little men who live in the mine. They make strange things happen!"
- ―Percy being teased by Douglas
Every summer, the branch line stations all take part in a competition to find the most beautiful station on Sodor. The engines love to help out by bringing decorations and flowers to the stations.
One afternoon, the Fat Controller orders Percy to collect some flowers from the garden centre near the old mine for Lower Tidmouth. Percy is scared and tells the Fat Controller that he does not like going past the old mine. The Fat Controller laughs and assures Percy that it is just some old buildings. Percy sets off as fast as he can, but when he sees a red signal ahead, he has to stop. Percy can see some strange old buildings through the mist. He hears a creepy creaking noise and shuts his eyes. When he opens them again, he sees one of the old buildings sinking into the ground. The signal turns to green and Percy speeds away as fast as his wheel will carry him.
The next day, Percy tells Donald and Douglas all about the disappearing building. Donald and Douglas tease Percy by telling him that is must be the naughty goblins who live in the mine. They are little men who make strange things happen.
Later that day, the Fat Controller asks Percy to go back to the mine to collect more trucks. Percy is very worried and hopes that he will not meet any naughty goblins. Bravely, Percy steams towards the old mine. As he approaches, he sees two little men with pointy hats waiting for him beside the line. Percy thinks they are the naughty goblins and races away in horror without waiting to collect the trucks.
The Fat Controller smiles when he hears Percy's story about the naughty goblins. The Fat Controller explains that the old buildings are sinking into the old mine shafts and that the "naughty goblins" are actually lucky garden gnomes which are to be used to decorate the stations.
The next morning, Percy goes back to the old mine to collect the trucks of garden gnomes. He then delivers the gnomes to Lower Tidmouth. That afternoon, the winner of the most beautiful station contest is revealed to be Lower Tidmouth. Percy admits that the garden gnomes must be lucky after all.
- Donald and Douglas
- Sir Topham Hatt
- Thomas (cameo)
- Henry (cameo)
- Gordon (cameo)
- James (cameo)
- Nancy (cameo)