JANUARY
Now played by Laurence Hugo, Mike returned from Capitol City, with plans to help Governor Kelley smash the heroin ring in Monticello. Mike was helped by Barbara Barnett, Kelley's assistant who had been planted by Kilborn. Before he could doublecross Reno, Phil was kidnaped by Reno and Sam Haven and held prisoner in Ursula's sanitarium.

FEBRUARY
Ursula performed plastic surgery on criminal John Lambert, and when the bandages came off, he was a doppleganger for Phil Capice. Kilborn replaced a kidnaped Phil with impostor Lambert in a faked car crash. Ursula suggested eliminating the real Phil, but Kilborn decided to keep him alive and drugged just in case the plot to dupe Louise didn't work; however, Louise attributed subtle differences in Phil to injuries sustained in the accident.

MARCH
Mike met and was intrigued by the beautiful Nancy Pollock, a newspaper reporter. While driving the car of Ted Grant, owner of The Monticello Herald, Nancy's brother Lee was involved in an accident with girlfriend Betsy Brown. Mike and Nancy butted heads when Mike suspected that Lee lied about the details of the accident. Meanwhile, DA Austin Johnson bribed Grant to promote Johnson's upcoming bid for a governorship.

Ursula kept tabs on the Grimsleys and Capices by working at Orchard Hill as "Phil's" private duty nurse. When Louise became intimate with Lambert, she realized something was terribly wrong with her husband. Winston grew impatient with "Phil's" treatment of Louise and suspected truth in the rumors of his son-in-law's involvement with narcotics trafficking.

Kilborn tormented the real Phil, who was held captive inside Ursula's convalescent sanitarium.

APRIL
Mike wondered how Phil could turn so quickly into a criminal, but an offhand analogy from Nancy regarding her mother's roses made Mike realize that the man calling himself Phil was probably an impostor. Mike attempted to contact Bill with his suspicions, but thug Julie Kurtz beat Mike into unconsciousness first. Nancy, who quickly grew fond of Mike, fretted about his condition.

Louise confronted Lambert with her suspicion that he's not really her husband. After admitting that her suspicions were correct, Lambert decided to kill Louise. Kilborn valued Louise more than Lambert and plotted to eliminate him first.

MAY
At Orchard Hill, Kilborn locked Louise in the study, shot John Lambert, and framed Louise for the crime. When Louise threatened to tell the police everything, Kilborn allowed to her see Phil, still a prisoner in the Bauer Sanitarium. Kilborn warned Louise that he would kill Phil instantly if she revealed the truth.

DA Austin Johnson indicted Louise for Phil's murder and expedited her trial in order to ensure his bid for governorship.

Mike regained consciousness, much to Nancy's relief. Mike shared his information with Bill, and they worked to prove their suspicions about Kilborn and Lambert, despite Louise's refusal to admit the truth.

JUNE
Mike defended Louise in her trial for killing Phil. Bill located the real Phil, and after arresting Ursula, brought Phil to the courthouse where Mike called him to the stand as a surprise final witness. As the courtroom erupted in chaos, a deranged Kilborn, desperate for a heroin fix, took a courtroom stenographer hostage at gunpoint.

JULY - DECEMBER
Mike and Bill saved the courtroom stenographer from certain death, as a sick and crazed Kilborn fell whimpering to the floor. Kilborn, Bauer, Reno, and Haven were all sent to prison as the narcotics operation crumbled.

Austin Johnson cheated on his wife Constance with seductive Toby Marshall and became further embroiled with villainous Ted Grant, who resented Nancy's growing attraction to Mike Karr. Grant and Johnson schemed to have Mike disbarred. The duo forced editor Joe Pollock to launch a smear campaign against Mike in the newspaper, by paying off Ann Barton to lie that her late sister Sybil Gordon had been bedded and duped by Mike four years earlier. Later, Grant stabbed thug Julian Kurtz to death and attempted to frame Lee Pollock for the crime. Mike proposed marriage to Nancy, but their nuptials were threatened by the shadow of Lee's potential arrest and trial for killing Kurtz. When Grant began to blackmail Johnson, Austin discovered a way to rid himself of Grant, Karr, and the Pollocks in one fell swoop: at the Herald's New Years Eve employee party, Austin shoved Ted Grant to his death down an elevator shaft.