The line of the so-called Norse earls, at the period at which we have arrived, 980 A.D., was represented by Sigurd Hlodverson, the hero of the Raven banner, which, as his Irish mother had predicted, was to bring victory to every host which followed it, but death to every man who bore it in battle.[27] Sigurd claimed Caithness by the rules of Pictish succession, as grandson of Grelaud daughter of Duncan of Duncansby, Maormor of that district. This claim was disputed by two Celtic chiefs, Hundi (possibly Crinan, Abthane of Dunkeld) and Melsnati, or Maelsnechtan; and in a battle at Dungal's Noep, near Duncansby, at which Kari Solmundarson is said in the Saga of Burnt Njal[28] to have been present, Sigurd defeated them, but with such loss to his own side that he had to retire to Orkney, leaving Hundi,[29] the survivor of his two enemies, in possession of his lands in Caithness. Sigurd himself, on his voyage from Orkney, fell into the hands of the Norse king, Olaf Tryggvi's-son, who was returning from Dublin to Norway, in the bay of Osmundwall or Kirk Hope in Walls; and the king insisted on the jarl being baptized on the spot, under penalty, if he and all the inhabitants of his jarldom did not become and remain Christians, of losing his eldest son Hundi or Hvelpr, whom the Norse king seized and retained as a hostage. He also sent missionaries to evangelize the jarldom. Such was the conversion of Orkney and its jarl from the worship of Odin, at or about the end of the first millennium of the Christian era.

On his son's death in captivity, Sigurd seems to have deserted the Norse for the Scottish side, and to have devoted himself to seeking the favour, by his assistance in completing the conquest of Moray from the Norse, of the Scottish king Malcolm II, whose third daughter he married as his second wife.[30] He was, by race, more than two-thirds Gaelic, and he clearly at first held Caithness in spite of all Scottish attacks, and probably later on agreed to hold it from the Scottish king.

A few other persons are referred to in the Sagas as connected with Caithness at this time. In the Landnamabok (1.6.5) we find Swart Kell, or Cathal Dhu, mentioned as having gone from Caithness and taken land in settlement in Mydalr in Iceland, and his son was Thorkel, the father of Glum, who took Christendom when he was already old.

About this time also, as appears from the Saga of Thorgisl,[31] there was an Earl Anlaf or Olaf in Caithness, who had a sister, named Gudrun, whom Swart Ironhead, a pirate, sought in marriage. But Swart was killed in holmgang, or duel, by Thorgisl, who cut off his head and married Gudrun, by whom he had a son called Thorlaf. Thorgisl then tired of Gudrun, and gave her to Thorstan the White on the plea that he himself wished to go and look after his estate in Iceland, which he did. Can this Anlaf be the original of the legendary Alane, thane of Sutherland, whom Macbeth, according to Sir Robert Gordon in his Genealogie of the Earles of Southerland,[32] put to death, and whose son, Walter, Malcolm Canmore is said to have created first Earl? Or was Alane, like others, a creation of Sir Robert's inventive brain? He was certainly no earl of the present Sutherland line; neither was Walter.[33]

To this period also belongs the romantic story of Barth or Bard, son of Helgi and Helga Ulfs-datter told in the Flatey Book, and translated at page 369 of the Appendix to Sir George Dasent's Rolls Edition of the Orkneyinga Saga, which is shortly as follows.

In the time of Sigurd Hlodverson, Ulf the Bad, of Sanday in Orkney, murdered Harald of North Ronaldsay, and seized his lands in the absence of Harald's son Helgi, a gentle Viking, on a cruise. On his return, Helgi, to revenge his father's death, slew Bard, Ulf's next of kin, in fight. Jarl Sigurd blames him for this and for not letting him settle the feud himself, and Helgi sells all he has, and goes to Ulf's house and takes his daughter, Helga, away. Ulf follows them up by sea with a superior force, defeats Helgi off Caithness, and he jumps overboard with Helga and swims to shore, where a poor farmer, Thorfinn, as Helgi had always been kind in his "vikings" to such as he was, has the wedding at his house, and shelters the pair there till on Ulf's death two years after they can return to Orkney with Bard or Barth, their infant son. At twelve years of age, Barth desires to fare away "to those peoples who believe in the God of Heaven Himself," and fares far away accordingly. Barth works for a farmer, and works so well that his flocks increase, and gets a cow for himself as a reward, but meets a beggar who begs the cow of him "for Peter's thanks." Each year a cow is the reward of Barth's work, and each year he is asked for the cow, and gives her up, until he has given three cows. Then St. Peter (for the beggar was no other than he) passes his hands over Barth, and gives him good luck, and sets a book upon his shoulders; and he saw far and wide over many lands, and over all Ireland, and he was baptized, and became a holy hermit and a bishop in Ireland. Such is the Norse story of Barth, to whom the first Cathedral in Dornoch was said to have been dedicated. It is far more prettily told in the Saga.

But St. Barr of Dornoch, in all probability, belongs to the sixth century,[34] not to the tenth, and was a Pict or Irishman, not a Norseman. He was never Bishop of Caithness, so far as records tell. His Fair, like those of other Pictish Saints elsewhere in Cat, is still celebrated, and is held at Dornoch.

The battle of Clontarf, fought on Good Friday, the 23rd of April 1014, outside Dublin, between the young heathen king of Dublin, Sigtrigg Silkbeard, and the aged Christian king, Brian Borumha, was, notwithstanding Norse representations to the contrary, a decisive victory for the Irish over the Norse, and for Christianity against Odinism. Sigurd, Jarl of Orkney, though nominally a Christian, fought on the heathen side, and fell bearing his Raven banner, and the old king, Brian, was killed in the hour of his people's victory.

Sigurd's death is the subject of a strange legend, and the occasion of a weird poem, The Darratha-Liod[35] said to have been sung in Caithness for the first time on the day of Sigurd's death.