"Hearts and Hands" is a wonderful example of O. Henry's signature literary style of irony. It is like watching a magician performing slight of hand.
You are presented with three characters: a U.S. marshall, a fugitive, and a proper young lady. They have a chance meeting on a railroad car.
The young lady goes to shake hands with the younger of the two, for she recognizes him as a former acquaintance. He shows great regret at the need to take her hand with his left hand, as his right it tethered to that of the grizzled older man. It is her assumption that her well-mannered, stately friend is the marshall, thus leading to the assumption that the glum, time-worn half of the duo is the fugitive.
It is only as the two exit to the smoker's car that another passenger points out the obvious. A marshall always keeps his right hand unshackled.
It is at this point that O. Henry quite artfully points out that you cannot judge a book by its cover.