On a previous visit I was told that this is a "folly" but today I realised that is [was] a shell house. It would appear that it was decorated with shells inside rather than outside.
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I have never been able to decide if there are three distinct lakes or one lake divided into three sections by walls and waterfalls but there are two separate bridges. To the best of my knowledge, the water for the lake(s) is fed from an underground supply and flows downhill [of course] in the same direction as the River Dodder.
