Sir Percival is having a breakdown. He panics that his scheme to gain Laura’s wealth will be discovered now that she has escaped from the asylum. Worse, he fears his secret will come out, even though Mrs. Catherick is the only person left alive who knows it.
Count Fosco, however, is still confident. He forwards a letter to Marian via her lawyer warning her and Walter that they must return “Anne” – Laura – to the asylum at once. Such a move would be devastating to Laura. She is already suffering from severe trauma, recoiling from the touch of Marian and Walter and almost ending her life by throwing herself off a roof.
Unfortunately, Walter and Marian cannot get Laura medical aid or even prove that she is indeed Laura Fairlie and not Anne Catherick, thus keeping safe from the threat of being returned to the asylum. They lack the funds for a doctor, and getting one might lead Sir Percival and Count Fosco to them. And, as the hardened Erasmus Nash tells Walter, the police “are not interested in empathy but fact.” They will never believe Laura is not Anne based on the evidence that Nash has gathered so far.
So Walter goes to visit Anne Catherick’s mother in the hopes that she might divulge Sir Percival’s secret and thus give Walter leverage over Sir Percival. But Mrs. Catherick is a proud and cynical woman. She reveals nothing, except for an implication that there was something amiss with Sir Percival’s mother.
Encouraged by this hint, Marian writes to churches in the region in which Sir Percival was born to discover where his parents were married. When she discovers the correct parish, Walter goes to examine its registry. He and the clerk realize that it has been tampered with: Sir Percival’s parents were crammed in at the bottom in different handwriting. Sir Percival’s parents must not have been married; he is illegitimate, and thus has no claim to his property or title.
Walter entreats the clerk to keep the registry safe while he writes to Erasmus Nash with this news; he will return that evening. But Sir Percival, fearing his secret is not safe, gets there first. He steals the keys to the church and locks the door to destroy the last evidence of his illegitimacy. But the clerk has noticed the missing keys, and he and Walter are approaching. Sir Percival panics and starts a fire to burn the registry. But the church is old; the door’s lock is stuck. Walter and some other men drawn by the growing blaze break down the door, but Sir Percival has already been consumed by the fire.
Back in London, Marian learns of Sir Percival’s death from an unwelcome source: Count Fosco stops her in the street outside her dwelling. He has known where they were hiding the whole time, and now that Sir Percival is dead, he has brought the asylum keeper to put Laura away again – unless Marian promises to prevent Walter from investigating him further. She refuses. Fosco’s menacing threats only end because Erasmus Nash appears.
Nash and Marian tell Laura and tell her of Sir Percival’s death. Although she had often wished him dead, she now forgives him. This unselfish reaction deeply affects Nash; he has not been able to forgive so easily. He did not approve of his daughter’s marriage; he has not seen her since, and now she has a child. But he is too ashamed to go to her now.
Walter visits Mrs. Catherick again to bring her news of Sir Percival’s death. She reveals how she learned Sir Percival’s secret: her husband was the parish clerk, and she stole the keys from him to let Sir Percival tamper with the wedding registry. Why did she help him? Sir Percival knew her own secret: Anne’s father was Philip Fairlie, Laura’s father. Sir Percival blackmailed Philip with his knowledge of that infidelity to force him on his deathbed to promise Laura to Sir Percival in marriage.
The revelation that Anne was Laura’s sister is shocking, but it does nothing to help Walter and Marian prove Laura’s identity, now that Sir Percival is dead. Their only hope is to force Count Fosco to confess to his and Sir Percival’s scheme. Knowing that Fosco was somehow involved in politics in his native Sicily, they decide to approach Walter’s friend Pesca for information – who originally recommended Walter for the job that led to him meeting Marian and Laura. Pesca, too, was involved in Sicilian politics; perhaps he knows something about the Count.
Walter brings Pesca to an opera that he knows Fosco is attending. The two Sicilians spot each other, and Fosco seems afraid. Pesca explains why: both were members of an underground political society, but the Count betrayed it and fled. The conventions of the society demand that such a traitor be killed.
Armed with this threat, Walter confronts Fosco at his manor. He is welcomed by a drawn pistol, but warns that Pesca is waiting outside. If Walter doesn’t emerge safely, Pesca will avenge him. Walter demands that Fosco confess. In exchange for a promise of a safe exit from London, the Count admits to faking Laura’s death in order to defraud her of her wealth by sending her to the asylum as Anne while passing off the dying Anne as Laura.
With this testimony committed to writing by Erasmus Nash, Walter finally has the evidence he needs to confirm Laura’s identity and save her from the threat of the asylum. Having seen the ordeal through to its end, Nash decides to attend to his own affairs and reconcile with his daughter.
And Count Fosco? He prepares to flee the country. But he is stopped by Pesca, despite Walter’s promise of safety. As the Countess drives away in their carriage, Pesca slits Fosco’s throat.
A better life begins to dawn for Laura. Marian and Walter’s loving ministrations have slowly pulled her from her depression, and when Walter proposes, she is eager to accept. She, Marian, and Walter return to Limmeridge, where they – with the help of the manservant – force her uncle to admit her identity, apologize for turning her away, and bless her impending marriage. That accomplished, Walter and Laura are married, and Walter’s mother joins them at Limmeridge to make a happy family. Marian sets off to see the world on her own. And Anne is given a proper headstone, thanks to her loving sister Laura.