Communication Problems (a.k.a. Theft) - S2-E1
Plot hole: Basil torments Mrs. Richards by miming when he is speaking to her, so she will think her hearing aid has failed. However, she speaks twice during the scene, and she would hear herself - obviously - and would know that he was trying to fool her.
Answer: A possible explanation can be found here: http://tviv.org/Fawlty_Towers/Waldorf_Salad Quote: "This is, of course, sarcasm, as southern California in general and Los Angeles in particular is famous for its palm trees".
Mortug