Chris Lloyd presents the first installment of a two-part Christmas ghost story which is based, rather losely, on a true event.

This lady who in violence died,

Left her blood, that none could hide,

Her desolate vigil, still to keep,

While Darlington folk are sound asleep.

OWN by the banks of the River Skerne, in what today's generation of Darlingtonians would regard as the town centre, there once stood an elderly manor house. It had been a sumptuous place, a Bishop's Palace, full of grand sweeping stairways, dramatic rising archways and long echoing corridors. There was a cavernous banqueting hall where the great and the good from miles around came, dressed in their finery, to dine at the Bishop's table.

It was also a rural retreat, a place of sanctuary for the Prince Bishops who, in their heyday, ruled County Durham as if they were kings. In those medieval days, neither industry nor commerce intruded into the town centre. The sparkling Skerne teemed with brown trout nibbling at eveningtide flies, herds of wild deer roamed the buttercup-filled pastures of Bank Top and Feethams, and swans - the most regal of birds - swam serenely on the river while ducks dabbled in its margins.

The Palace had been built by Bishop Hugh Pudsey, perhaps Durham's most famous bishop, in 1164 when the Prince Bishops were at the height of their powers. For a night in 1503, it played host to a royal guest when Queen Margaret, the daughter of Henry VII and the grandmother of Mary, Queen of Scots, broke her journey north in Darlington. A special lock was fitted to her chamber door and for centuries after the key was one of Darlington's most prized possessions.

But during the English Civil War of 1642-1651, the Bishops of Durham suffered greviously. Durham Castle was confiscated and sold to the Lord Mayor of London, and Stockton Castle, which they also owned, was destroyed on the orders of Oliver Cromwell himself. In Darlington, all of their powers and properties were removed, with the exception of the Bishop's Palace. In 1667 Bishop John Cosin set about restoring it so that it was again a palace fit for a bishop.

These were dangerous times with rebellion and counter-rebellion in the air. So into Bishop John's sanctuary by the Skerne moved his daughters Mary and Frances who were married to Sir Gilbert Jarratt (or Gerrard) and his brother Sir Charles.

The Cosins and the Jarratts came and went, history's tide washing them, and the bishops, out of Darlington. Their palace by the Skerne fell into disrepair; its driveway, once graceful and sweeping, became the Leadyard as industry gnawed into its rural pretence.

Indeed, so low did the palace fall that in 1806 the township of Darlington bought it and turned it into a workhouse. Here the destitute and the desperate came to live and work so that their poverty didn't clutter up the prosperous streets where merchants made an honest living.

In 1868, Darlington built a new workhouse up Yarm Road and the old palace was bought by Richard Luck. He ran a drapery shop on High Row, one of the town's most celebrated stores on its most celebrated street (Luck's was in the building that Dressers vacated in 2001) and would become mayor in 1873.

Richard planned a luxury riverside development on the site of the palace and began demolition. He found the floors to be made of red sandstone taken from the beds of the Skerne and the Tees and the walls were only plaster and rushes from the rivers.

But beneath the centuries of whitewash that covered the walls were some interesting architectural features. The grand arches, for instance, appeared to date back to Pudsey's day and the Lucks decided to salvage them, if only for use as garden ornaments in their country home at Middleton St George.

One night in 1868, Richard's son Robert, who was in his thirties and would later become widely respected as an alderman, was working late on a medieval arch, chip, chipping with his chisel at the centuries of crude plaster and the whitewash which had been applied as if it were an unsuccessful attempt to cover up an indelible stain. He thought he was alone, and the noise of his work echoed along the empty corridors of the derelict palace.

But he was not alone.

"I was soon very much engaged in my work when I heard a footstep coming out of a room at the end of the corridor," he wrote later. "I could hear the rustle of a silk dress. She came to me close until I could feel her breath and her dress as she stooped over my shoulder to see what I was doing.

"I stood it a very short time and then bolted along the corridor as hard as I could go, and was at home at the High Row at 10.15pm."

Heart pumping, Robert was rational enough to know that things don't go rustle in the night for no unearthly reason. He knew there were no such things as ghosts - particularly not ghosts who took a detailed interest in ancient masonry.

To reassure himself of these certainties, he waited until the rest of his family were asleep before slipping out of the house on the High Row and returning to the scene of his haunting. "I went down to the old workhouse, and went into one room after the other, and counted aloud to 50 in each room," he wrote. "When I got to the arch I counted 200 and the same in the room at the end of the corridor. Then I felt easier with myself."

He had laid his ghost to rest. Possibly...

Because Robert also knew that although ghosts didn't exist, he was only the latest in a long line of Darlingtonians who had encountered a phantom near the Bishop's Palace.

Indeed, he even knew the name of the ghost: Lady Jarratt. For centuries, she'd been haunting the Leadyard area where, in 1970, the new town hall was built. Often she was seen skimming across the Skerne, weeping and wailing in her white silken dress. Or she'd be spotted gliding down the Leadyard, crying piteously.

She scared traders in the Market Place with her sudden appearances, and she had tormented the inhabitants of the workhouse, tossing them out of bed onto the cold sandstone floor in the middle of the night. When her weeping subsided, she had been known to take pity on the inmates, brewing them drinks when they were poorly and mopping their fevered brows when they were sickening.

On occasions, she was even known to venture away from her town centre haunts, but as soon as she left the Skerne behind her she was condemned to take the form of a large white rabbit with eyes as big as saucers - and, naturally enough, there were always tears in the rabbit's eyes. But the most gruesome aspect of all the sightings of Lady Jarratt - the lupine ones excepted - was her bloody stump. As she glided over the Skerne wailing or as she spirited her way down Leadyard weeping, she was always pointing to the stump where her arm had been brutally hacked off.

And Robert knew that, according to the story, the indelible stains on the walls and the floor, stains that centuries of whitewash could not quite conceal, were in fact her blood that had been spilt as she slumped dead in the moment of her murder most foul...

The ancient Manor of Darlington town

Stands by the Skerne, on the banks low down.

'Twas a stately house in the days of yore

When the Jarratts dwelt in it, who live no more.

But one remains, and she will not go,

She haunts the house, flitting high and low,

The Lady Jarratt, by soldiers slain,

Her rich attire and her jewels to gain...

The stains are there, they will not away

Where the blood is spilt, must the spirit stay.

l Tomorrow: the brutal murder of Lady Jarratt and historical evidence that this is a true story