That night, Sir Michael goes to bed early. Lady Audley goes to her own room and broods over her unhappiness and unease, despite the luxury that surrounds her. While she is there, Phoebe Marks arrives. Lady Audley expresses how unhappy she is, and how Robert Audley and his suspicions torment her. Phoebe explains that Robert is staying at their inn that very night. She also says that Luke has sent her to Audley Court to ask for money; he is doing a bad job of managing the inn, and they have blackmailed Lady Audley for additional money a number of times. The two women talk about their frustrations and feeling trapped; to illustrate her husband’s incompetence, Phoebe explains that he has nearly caused a fire a number of times due to being careless while drunk. Phoebe also delivers a letter to Lady Audley from Robert; in it, he threatens to have Mrs. Barkamp identify her as Helen Talboys.
Volume 3, Chapter 1
Lady Audley becomes increasingly agitated, knowing that Robert will stop at nothing to uncover the truth. Abruptly, she dresses and tells Phoebe that she is going to go back to the inn with her to deliver the money in person. Phoebe is very confused as to why she would do this, but Lucy is insistent. She also explains that she wants this outing to be kept secret, telling Phoebe to leave the house alone and then wait for her. After Phoebe is escorted out and Lady Audley has sent her maid to bed, she sneaks out of the house. She rejoins Phoebe and the two women walk back to the inn at Mount Stanning. Luke Marks is awake and drinking with the landlord, who has come to collect the rent. Lady Audley pays the rent and then explains that she wants Phoebe to go back to Audley Court with her. She then says that she feels ill and needs to wash her face. Before going to Phoebe’s room to do so, with a candle to light her way, she asks what room Robert Audley is sleeping in, which confuses Phoebe. Alone, Lady Audley goes to the room he is staying in and locks the door from the outside. She then goes to Phoebe’s room, washes her face and sets the candle down very close to some hanging fabric. When she comes downstairs, she tells Phoebe that the candle was blown out by the wind. The two women begin to walk back to Audley Court; at one point, Phoebe looks back and sees a building on fire in the distance. She is convinced it is the inn and wants to hurry back to help. Then it occurs to her that Lucy might have caused the fire; she asks her if she did it. Lady Audley reacts with outrage but does not explicitly deny it. She leaves Phoebe on the road in hysterics and walks back to Audley Court.
The next day is rainy; Sir Michael mentions that Sir Harry Towers has left to go traveling, and thinks about how it is sad that Robert and Alicia have not been able to make a match. Lady Audley is anxious, waiting for news of the fire. Finally, she is shocked to find Robert himself appear at Audley Court.
Robert and Lady Audley speak alone. He tells her that there had been a fire the night before and that he had only escaped because he had not actually been sleeping in his designated room. Finding it cold and damp, he had slept in a small room on the main floor instead. Because he was there, he woke up and helped the servants and Luke to escape, though Luke is badly burned. Phoebe has told him about Lady Audley’s visit to the inn in the middle of the night, and he accuses her of setting the fire. Because of this horrible act, he will now reveal her identity unless she chooses to confess to Sir Michael. Lady Audley says that is mad, and that she did indeed kill George; she asks Robert to get Sir Michael. Robert brings Sir Michael and Lucy begins her story. She grew up in poverty, not knowing the whereabouts of her mother, with a father who was frequently absent, and an indifferent nurse to take care of her. Finally Lucy discovered that her mother was mad and was institutionalized. This story is very different from what Sir Michael has previously been told.
When Lucy was ten, she visited her mother in the asylum and learned that her illness was hereditary: Lucy could expect to someday go mad as well. Ashamed, she hid this secret once she was sent away to school. When she was seventeen, she left school and went to live with her father at Wildernsea, but they were still poor, and she had little to look forward to. She was charmed by the handsome George Talboys, and married him in hopes that he could give her a better future. However, she was rapidly disappointed when he no longer had an income; after the birth of their son, they argued and he left for Australia. She was left angry and resentful, and struggling to provide an income for herself, her child, and her father. Desperate, she decided to run away to London and try to create a new life for herself. She responded to an advertisement posted by Mrs. Vincent, and assumed a false name. While living as Lucy Graham, she was hired by the Dawson family, and then married to Sir Michael. She justifies this by saying she believed, with just cause, that her husband might well be dead. However, shortly after her marriage, she saw in the paper that George was returning to England. She knew he would not rest until he found her, so she decided to fake her death, with her father’s help.
She traveled to Southampton, claiming to be in London visiting Mrs. Vincent, and told her father the whole story. They agreed to post an announcement of her death, but knew that George would look for answers. She meets Mrs. Plowson, who was looking after little George. She discovered that Mrs. Plowson’s daughter, Matilda, who was approximately the same age, and also petite and blonde, was close to death. Lady Audley arranged for her father to rent rooms in Ventnor for himself, his dying daughter, and his grandson. Matilda was introduced to everyone as Helen Talboys, and when she died, her death was recorded under the same name.
After the end of the story, Sir Michael walks away without saying a word, and immediately arranges to go abroad with Alicia.
Alicia does not know anything about what has been revealed, but Robert makes her swear to comfort and support her father. He tells her only that Lady Audley and Sir Michael are going to separate and that she should travel with her father wherever he goes. Lady Audley is put to bed in a state of illness, and Alicia and Sir Michael depart. Robert gets a referral for Dr. Mosgrave, a doctor who specializes in mania, and requests that the doctor come to Audley Court.
Lady Audley by now is feeling very tense and guilty. Braddon uses irony in her description of the luxurious and beautiful rooms that Lady Audley inhabits. Despite everything she has done in order to be able to live in that space, it still does not make Lady Audley happy and cannot soothe her conscience. While her secrets are supposed to protect her, they actually create a threatening atmosphere where she can never feel safe or at ease.
The conversation between Phoebe and Lady Audley reveals how Braddon creates complex and ambiguous characters, which can be both sympathetic and unsympathetic at the same time. While both women have acted in unethical ways, they are by this point both vulnerable and frustrated. Phoebe is trapped in a marriage to a man she doesn't respect or trust. Lady Audley is running out of money but can't risk refusing Luke. The structure of positioning this episode right before Lady Audley decides to commit one of her villainous acts introduces ambiguity about whether she was driven to it out of desperation, and whether there can be any justification for her actions. She seems to believe that if Luke and Robert were to both die in the fire, both she and Phoebe would be better off.
The description of what happens at the inn is carefully structured to moderate the reader's response. While Lady Audley has carefully planned out what she will do, and takes steps to ensure she will be successful, such as locking Robert in his room, Braddon does not actually describe her deliberately starting a fire in Phoebe's bedroom. Rather, she places her candle in such a location that it is almost inevitable the hanging fabric will catch fire. There is still an element of chance, which makes a slight difference from representing Lady Audley as very deliberately starting the fire. At the same time, the fire is perhaps an even more terrible act than what it is later revealed she has done to George. Lady Audley doesn't react spontaneously, but sets a premeditated plan in motion. She also shows no compassion about the fact that innocent bystanders at the inn may be injured or killed in the fire.
Braddon shifts the tone dramatically in the next chapter. From the tense and suspenseful narrative and the dramatic events of the fire, the plot slows down. Lady Audley is waiting in an agony of suspense for news of the fire and Robert's death, and readers also experience this tension of being denied the information they most want. At this moment, it seems that Lady Audley may have gotten away with her crimes, and this makes the sudden appearance of Robert at Audley Court all the more shocking. It also leaves Lady Audley in a very vulnerable state: her best plan has failed, and even though she was willing to resort to murder, she has not been able to escape.
This realization triggers the novel's climax: Lady Audley declares that she is mad, summons Sir Michael, and tells the true story of her origins. This narrative confirms some of what Robert has pieced together, but also includes new information. Much of the information might potentially create sympathy for Lady Audley. The idea of her mother's hereditary madness suggests that Lady Audley might not be entirely responsible for her actions. It also suggests that there are broader social conditions that are impacting women's happiness and mental health. Lady Audley also describes how she has felt ashamed of the poverty she experienced, and how, being a woman, the only way to try to better her life was through marriage. Her perspective on events surrounding George's departure for Australia also cast things in a different light: she felt abandoned, frustrated, and angry, and was unwilling to wait around for a man who might have never returned.
The ambiguity about to what extent Lady Audley should be held personally responsible for her actions is furthered by Robert's decision to call in a doctor to investigate her mental state. If she truly is mad, she might not be truly responsible or liable for her actions. It seems as though both Sir Michael and Robert are struggling to accept what she has done, and hope to find a way to rationalize or make sense of her behavior.