Someone dares be evil in his territory? The nerve!
Klaus is the only one who can be evil, so he'll take down the competition.
I'm betting there's going to be an arc, where, thinking it'll finally restore his evil reputation, he'll join an evil faction...
...Only to turn out the evil faction was just misunderstood or in the middle of a reform, and it's thanks to
his sterling reputation as an amazing lord that the citizens start giving them a shot, giving them the proper opportunity to live the lives they've always wanted. They, of course, swore their fealty to his saintly, infinite kindness.
Him: "FUCK."