[exray]

The plates look undamaged and spacing looks even when fully meshed which is the end of the band at which the problem occurs.

Sure sounds like plates touching to me. The way to go about checking this would be to disconnect the tuning cap sections from whatever they are connected to (one at a time) and use an ohmmeter to watch for intermittent shorts. The only other thing would be the wiper on the shaft of the tuning cap making intermittent contact at that end of the range. I can't think of anything 'electronic' that would make it behave that way.

-Bill