The pair, who have not been close in the house, had begun to mellow towards each other, but comments from Caroline about Luke's change of gender appeared to bring old problems back.
Scott Mason observed: "She puts her foot in things, Caroline.
"They were talking about his sex change, and said, 'So the comment I made about the day was valid, you would know a lot about make-up' and he just went 'Just because I was a girl does not mean I like make-up'.
"It went all awkward and she kept saying things and it kept getting worse, it got more and more awkward and he got more and more annoyed."
Later, Adam Kelly, Luke A and Lauren Carre caught Caroline bitching, which kickstarted further problems in the house.
Caroline and Lauren clashed over the incident, with the latter complaining: "It's really hard when you're bitching. You were having a lovely conversation with Luke A, telling him how he was a remarkable person and five minutes later you were bitching about him."
Caroline blamed Lauren for gossiping about her and called her a "spoon". She also alleged that Luke A had got "really furious" and "stormed out" of their discussion.
Luke A's story was very different, claiming: "I was sort of snoozing, she came in screaming and I was like, 'Can you keep it down a bit'. And that was it. They were like, 'Oh, he stormed out!'"
Becky Hannon's version of events was somewhere between the two, commenting: "Me and Caroline got shouted at by Luke A because he wanted to sleep. He came storming out, banging on the Diary Room door."
