Dr Kate Peterson entered Wentworth as a prisoner at the same time as prisoner Sandy Edwards (Louise Le Nay) in late 1981, episode (235). She also shared the same charge as Sandy: Murder.
As soon as they entered the series it was obvious that big things would soon follow. For a start we got a rare preliminary shot of Kate and Sandy in the van prior to their arrival - while most new characters simply turn up in reception unannounced. In the van Kate explains that she knows nothing about prison life. Sandy tells her that she can help her and the two become genuine friends. After their induction they are placed in the same cell together. The two plan to stick together to face up to whatever hostilities may in store for them at Wentworth...
Sandy had previously served time in Barnhurst and had heard stories from Barnhurst top-dog Marie Winter (Maggie Millar) about the infamous Bea Smith. Sandy's true feelings toward Bea were unclear. While Sandy seemed to respect Bea's tough reputation, she also seemed sceptical of it. Sandy saw herself as quite tough as well and possibly saw Bea as equal parts an ally and an enemy, but definitely as a challenge. This feeling was magnified when Sandy actually met Bea, and found her to be far less tough than her reputation indicated (more on the reason why later). When the Sandy + Kate duo first met the other women the combination of Sandy's smug attitude and Kate's obvious superiority instantly alienated them from the others. This only served to strengthen the bond between Kate and Sandy.
Now, the reason Bea was not as tough as usual was because she was quickly becoming very ill. Bea had at first resigned herself to cancer as that is what had killed her mother, and as a result was more concerned for own health rather than the Wentworth pecking-order. It turned out Bea was not suffering from cancer at all. Dr Kate correctly diagnosed Bea's illness as a kidney ailment. These events set a major ball rolling... Picture it, a new and ambitious toughie, Sandy, with top-dog aspirations joins, instantly teams up with the assertive and brainy Kate who in turn relies on Sandy, they then alienate the other prisoners just before the usual top-dog is shipped out to hospital! Extra drama occurs as infamous Barnhurst top-dog Marie Winter is transferred to Wentworth.
Basically, by teaming up, Kate and Sandy soon gain the upper hand at Wentworth.
Throughout these machinations it appeared that Sandy was the schemer and plotter while Kate was simply caught up in it all in order to survive. On their arrival, Judy and Doreen had stirred up trouble for Kate and Sandy which was completely unprovoked, so when Kate and Sandy hit back (hard), we all rooted for them. It was obvious that Judy and Doreen were trying to mark their territory but they failed. When Judy and Doreen are both temporarily transferred to Barnhurst, and with Bea still in hospital, it becomes a battle of Kate and Sandy versus Marie.
Kate, of course was a very strong and assertive character who would not put up with any bullying from anyone. She was basically good however as demonstrated when she diagnosed Bea's kidney problem. Kate was slightly out of depth in Wentworth, but with Sandy as a partner they could stand up to almost anyone.
As Kate progressed in the series however, some shocking and unexpected twists occurred. While everyone realised that Kate was a smart lady, no one quite realised just how cunning and devious she really was. Early hints are given when her mother visits (242), and she admits to her that her real reason for killing her lover Conrad was not that he had been threatening her son, but that he had threatened to expose the fraud of the health service at Kate's practice. In the same episode, Kate's pleasant and efficient demeanour is revealed to be a facade when Lizzie tries to sympathise with her about her son, and Kate (who was shown to be utterly indifferent to her son on her mnother's visit) almost cracks and snaps back at her.
While pretending to support Sandy, Kate revealed her true nasty self by setting up regular clandestine lagging sessions with an equally deceitful and scheming officer, Colleen Powell. Her lagging revealed that she did not support Sandy at all. Sandy knew there was a lagger but it took her a while to figure out who. A very shocked and angry Sandy eventually realised that it was none other than Kate doing the lagging but kept quiet about this discovery. Sandy and Marie both wanted to deal with the lagger and so they drew cards to decide who would commit the deed. Sandy won.
In episode (264), Sandy decided that the time had come to deal with Kate. Sandy and Kate were on kitchen duty, taking the rubbish bins out to the hopper. As the rubbish-carrying duo reached the garbage hopper, Sandy indicated to a terrified Kate that she wanted to have a word with her. This occurred just as the other women were having an outdoor rec period. Marie generated the necessary diversion by starting a big brawl with Hazel Kent in the prison grounds, just as the rubbish truck drove past in the background...
After their brawl the women are marched inside. A few seconds later a ruffled looking Kate (Kate!) dashes through reception after them. It soon turned out that Sandy was missing and while all Wentworth was puzzled by her disappearance, some believing that she may have escaped, Marie Winter understood the shocking truth. Kate, of course, had somehow overpowered Sandy and dumped her into the garbage hopper, seconds before it was collected by the truck. Exactly how Kate managed to do this was not shown and was never revealed. Kate probably managed to knock Sandy unconscious with a rubbish bin or bin lid before dumping her in the hopper (they were both carrying bins in their final scene - but it seems quite strange that the usually clever Sandy allowed this to happen). The garbage-truck compacter would then do the rest...
While the prisoners didn't know what had happened to Sandy, one thing that was not a mystery was the knowledge amongst the women that Kate was the lagger. While she feared for her life at the hands of a vengeful Marie, Kate was relieved to learn of her impending transfer to Barnhurst. Kate smugly sauntered out to the prison van only to discover that another prisoner was being transferred as well - Marie Winter! Marie launched into a diabolical laugh when she saw Kate was joining her! Kate, fearing for her life, made a last ditch attempt to remain at Wentworth and away from Marie - she attacked the nearest officer. This ploy worked and Kate was dragged back inside while Marie was driven away.
Kate remained in Wentworth. However, she quickly began exhibiting signs of insanity! We now knew that Kate was indeed guilty of poisoning her lover, a crime committed during a paranoid fantasy. Judy Bryant was back in Wentworth by this time and unfortunately had to share a cell with crazy Kate. One night a deranged Kate spent the whole night with a manic gaze fixed on Judy! Quite a marked change from the strong and assertive Dr Kate we originally met only a few weeks before.
From this point Kate soon went completely mad and everyone was relieved when she was transferred out to a mental institution in episode (273), never to be heard from again.
Kate's storyline basically had three distinct phases: The interesting early phase were she befriends Sandy and they join forces to build a small empire for themselves in Wentworth, The Diabolical Phase were she shows her true colours as a schemer and a lagger, and The Insane Phase were, basically, she goes completely mad!
I personally think it might have been interesting to have left it up in the air with Kate, to just have shipped her out to Barnhurst with Marie and leaving her exact fate a mystery - although with Marie as an adversary it would have no doubt been fairly brutal. The scene where a smug Kate is marched off to the prison van only to find a grinning Marie waiting for her was a great scene and would have been a great way to cap off the whole storyline... That said, however, watching Kate go insane was pretty interesting, and the way it was acted, written and filmed, naturally, was excellent!