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Precedence refers to your social ranking, either above or below (or before or after) other people.
Rules of Precedence
This is complicated by the fact that in the period in which Age of Intrigue takes place, there were three separate peerages: Peerages of England, Scotland, in Ireland (there ranked from highest precedence to lowest).
A peerage was considered to be "of England" or "of Ireland" depending upon the intentions of the granting monarch, and usually reflected in the location of the place from which the peer took his title.
Within each rank (e.g., dukes), Peers of England precede peers of Scotland; together they precede peers of Ireland. The dates of creation further determine the order within each rank. So, an English peer whose title was created in 1540 would outrank an English peer whose title was created in 1640. However, because English peers take precedence over both Scottish and Irish peers, an English peer whose title was created in 1660 would still outrank a Scottish peer whose title was created in 1600, despite the date of creation being older.
This order of precedence takes effect within each rank of the peerage; no marquess would ever precede a duke, for example, regardless of the peerages to which they belonged. The Irish Duke of Leinster ranks last on the list of dukes, but precedes the oldest English marquessate.
Precedence of ladies is always derived from the father or husband, except in the case of a peeress in her own right. A wife bears a rank that is truly equal to her husband's in every respect except in actual comparison to him. However, husbands of peeresses in their own right do not take precedence from their wives. While a peeress by courtesy stands in the line of ladies in place of her husband, a man married to a peeress in her own right is pretty much left out in the cold. As precedence is determined by the specific peerage (i.e., English, Scottish, or Irish), and the date of creation, peeresses in their own right do not automatically outrank peeresses by courtesy unless their specific date of creation is older than the other woman's husband's.
Think of it this way: all the barons and baronesses in their own right are standing in line according to their dates of creation. The barons are then joined by their wives, who join the line immediately behind their husbands and preceding the next baron (or baroness in her own right). The husbands of the baronesses in their own right are left out in the cold. Almost all of the baronesses in their own right are near the front of the line, since their baronies are among the most ancient, but they may be preceded by barons of older dignities and their wives.
A dowager peeress, or widow of a baronet, takes precedence of the wife of the incumbent of the title only while remaining a widow. (So you have to hope your mother-in-law remarries someone of lower precedence if you want to sit above her at a formal dinner.)
Daughters of peers take the precedence, although not the equivalent title, of their eldest brother. (See the explanation of parcener.) Only the eldest son of a peer actually took precedence over his sisters (and thus naturally his wife would too). He of course would take his father's next-highest title as a courtesy title. So it would make sense that a mere Lady Sarah would be outranked by her younger brother, the viscount. However, Lady's Sarah's other brothers do not outrank her; since she takes her eldest brother's precedence, she outranks all of her other brothers (and all of their wives). If she is the daughter of an earl, she even gets the courtesy title "Lady" while her other brothers are merely "Master"
Certain government offices and royal tenures have a set precedence in the table of precedence that has nothing to do with the officeholder's own personal title. So, a mere knight, if made Lord Chancellor, would take his precedence from his office and not his personal rank.