Misleading title. There is no character in this film called Lady Sue, nor any name even remotely similar.
Young master Ying Feng is kicked out of home by his father, a master of mystical magic cures, because the "leader of black religion" is out to kill his entire family. Honest and stout-hearted, Ying Feng punches three guys who want to screw pretty dancer Miss Fan. Fan gets sweet on Feng and he agrees to let her stay with him.
The Fairy comes to town, touting his magic powers to cure the sick for anyone who'll pay his exorbitant fee. Ying Feng has some of the same talent, and cures a sick woman with no money and for no payment, thereby shaming The Fairy into both taking him on as a disciple and agreeing to charge less.
Li Quan, the "leader of black religion", has not given up trying to find Ying Feng, but his search is greatly slowed down by his assistants being far more interested in screwing each other silly than revenge.
Note - Both of the lead characters are actually called "Fung" in Cantonese, so I have used the Mandarin forms of their names, to distinguish them.