In Paris, Henry enters with his lords Gloucester, Winchester, Exeter, York, Warwick, Suffolk, Somerset, Talbot, and the Governor of Paris. Winchester crowns Henry as the king. Gloucester asks the Governor of Paris to swear allegiance to him and no other. Just then Sir John Fastolf enters with a letter from Burgundy. Talbot sees Fastolf and is enraged because of his cowardice at previous battles. Fastolf wears a Garter on his leg marking him as a member of the Order of the Garter; now Talbot rips this off him: Talbot tells Henry about Fastolf's flight from battle when the British were heavily outnumbered and when he and many other soldiers were taken prisoner; he says that membership in the Order of the Garter used to be awarded to men of noble birth, who were virtuous and who didn't fear death, but Fastolf is not this sort of man, and he sullies the title of knight. Henry calls Fastolf a stain to his countrymen and banishes him.
Gloucester then reads Burgundy's letter, in which he announces his intention of joining Charles and abandoning Henry. Henry asks Talbot to march to Burgundy and talk to him, to find out what has driven Burgundy to insult his friends. Talbot departs.
Vernon and Basset enter to ask the king for the right to have an armed fight. York asks the king to hear his servant, and Somerset asks him to hear his. Henry inquires into the nature of their complaint. Basset says that, while crossing the Channel, Vernon ridiculed him for the color of his rose, and Vernon says the same of Basset. York asks Somerset to put aside his malice, but Somerset says that York's private grudge will be revealed. Henry marvels at the madness that drives these men to develop such decisive splits for frivolous causes. He asks York and Somerset to overlook their differences and be at peace. York says that the disagreement should be settled first with this fight; Somerset says the disagreement is between only them, and they alone should decide it.
Gloucester scolds the lords, saying they should be ashamed for so troubling the king with this ridiculous argument. Exeter urges them to be friends. Henry orders York and Somerset to forget their quarrel and to remember where they are. Here in France, "amongst a fickle and wavering nation"(IV.i.138), the lords must make an effort not to reveal dissention, for if the French see disagreements among the English forces, then they will again dare rebellion. What a scandal it would be, he says, for leaders of other nations to hear that Henry's men lost France and destroyed themselves over a trifling argument! He reminds them that they must not lose the land that was won with so much bloodshed.
Henry takes a red rose from Somerset, saying "I see no reason, if I wear this rose / That anyone should therefore be suspicious / I more incline to Somerset than York. / Both are my kinsmen, and I love them both"(IV.i.152-5). Henry determines to persuade them to better behavior by offering them both important positions in the French campaign. He makes York leader of the troops in that part of France, and he orders Somerset to unite the horsemen and the infantry. He urges them to use up their anger against the enemy rather than against each other. Henry and most of his nobles leave.
York, Warwick, Vernon, and Exeter remain. They agree that the king spoke eloquently, but York doesn't like it that he chose the red rose of Somerset. Warwick says the king meant no harm. All exit except Exeter, who notes that York did well to keep his complaints to himself while Henry was there. Exeter says that no one yet understands that the arguments among the lords, "this jarring discord of nobility, / This shouldering of each other in the court, / This factious bandying of their favourites, / that it doth presage some ill event"(IV.i.188-91). England faces enough of a challenge, Exeter notes, when the crown sits on the head of a youthful and inexperienced king, but it faces doom when division is bred of envy and malice. What begins in confusion will end in ruin, he predicts.
Talbot's response to Fastolf again demonstrates his understanding of chivalry and valor and his obsolescence. Fastolf is an example of the worst kind of soldier, but he represents an increasingly fearful group of soldiers.
Vernon and Basset try to decide their own interpersonal quarrel by petitioning the king, but they merely reveal the continued disagreement between York and Somerset. The king offers convincing arguments for why they should end their fighting, namely that the French are watching them and will take infighting as a sign that the English will be unable to rule them. He tries to resolve the dispute by taking a red rose from Somerset and explaining that it means nothing, as he loves both nobles equally. But York is displeased, and Henry's gesture fails to bring reconciliation.
The king also tries cleverly to make the two nobles get along by assigning them significant positions within the English campaign. Yet he doesn't foresee that their petty infighting may infiltrate their military dealings and weaken the English armed front. In fact, it is Somerset's antipathy to York that leads to his slowness in providing troops to York and precipitates the death of Talbot, hence, overturning the English advantage in France. The French win the battle, but the English give them the victory via their internal squabbling.