In the simple ballads, such as We are Seven, and the lyrical meditation of Tintern Abbey, Wordsworth achieves an interplay between nature and the imagination that explores both the external world of sensory experience and the internal workings of the mind in contemplation.

isn't there a rule, that "that" should refer to the nearest noun? so in the sentence above, "that" would refer to "imagination", or can it also refer to "interplay"?

thx a lot