Chapter III: The Problem
Dr. Mortimer explains that the footprints were found 20 yards from the body, and that he would likely have overlooked them had it not been for the legend.
Holmes then questions him, asking for details about the alley where Sir Charles died. As Dr. Mortimer explains, it consists of a gravel path surrounded by tall hedges on two sides. One part of the alley leads to a summer house; the other end leads to the main house. One hedge is interrupted by a wicket-gate, which opens out onto the moor. Hence, there are three entrances to the alley overall. Finally, he notes that the main alley path is separated from the hedges by strips of grass.
Holmes is upset that Mortimer did not call him immediately, since clues have obviously been erased in the interim. Mortimer counters that the case might be beyond Holmes's abilities, since it features supernatural elements. According to reports, several people had seen an unnatural creature on the moor, even before Sir Charles died. No such reports have been filed since the death. Holmes then questions why Mortimer would include him at all, and Mortimer explains that Sir Charles's nephew and the next heir, Sir Henry Baskerville, is to arrive in London, and Dr. Mortimer is worried for his safety. He believes that it is important for the moor community to keep a resident in Baskerville Hall, one who can continue Sir Charles's philanthropy, or he would otherwise simply warn Sir Henry away.
Holmes advises Dr. Mortimer to meet Sir Henry at Waterloo as they had planned, and to mention nothing about the hound. He further instructs Mortimer to bring Sir Henry to him on the next morning, by which point Holmes will have determined the proper course of action.
After Dr. Mortimer leaves, Watson leaves Holmes alone to think. When Watson returns later, he finds the room filled with tobacco smoke. With little effort, Holmes perceives that Watson has spent all day at his club. He then shows Watson a map which he has obtained of the moor, and points out the various locations mentioned by both Dr. Mortimer and the manuscript author.
Holmes proposes that there are two questions before them: first, has any crime been committed at all? And second, what is the crime and how was it committed?
Watson finds the case bewildering; Holmes agrees that it has a "character of its own" (164). He believes the tip-toe footprints are signs that Sir Charles was running, though he does not know what the man was fleeing. The fact that he ran away from the house rather than towards it suggests he was terrified out of his wits. Holmes also believes that Sir Charles must have been waiting outside for someone, which would explain the cigar ash that Dr. Mortimer described.
Chapter IV: Sir Henry Baskerville
The next morning, Dr. Mortimer and Sir Henry arrive, with a brand new mystery. Someone has sent a letter to his hotel, constructed of printed words cut from somewhere and then pasted. It reads: "As you value your life or your reason keep away from the moor" (167). Only the word "moor" has been hand-written. The mystery is all the more disconcerting since nobody knew which hotel Sir Henry planned to stay at.
From the typescript, Holmes quickly discerns not only which newspaper the words were taken from, but also from which article, and in fact determines that the words were cut with nail scissors. He further deduces that the person who composed this letter was educated, but wished to pose as an uneducated man. He suspects the culprit worried that Sir Henry would either recognize his handwriting or soon enough encounter it. Finally, he notes that the letter's composer was in a hurry, likely because he feared an interruption.
Holmes asks Sir Henry if anything else of interest has happened to him. Though shocked at this turn of events, the man explains that one of his brand new boots is missing after he left them in the hotel hallway to be polished.
Sir Henry demands to know what is happening, so Dr. Mortimer tells his story. Intrigued, Sir Henry admits he has heard the legend but never taken it seriously. When Holmes follows with his belief that there is some danger at Baskerville Hall, Sir Henry angrily declares that there is "no man upon earth who can prevent me from going to the home of my own people" (174). However, he invites Holmes to lunch later that day, at which point he will have though the matter through.
As soon as Sir Henry and Dr. Mortimer leave, Holmes jumps to action. He and Watson follow the men, and notice another man following them from a cab. Watson notes that this man has a bushy black beard and a pair of piercing eyes. When the cab suddenly rushes off, Holmes attempts to hail his own cab, but fails. Cursing his bad luck, Holmes admires the culprit's cleverness, but is glad he was able to note the cab number before it left.
Holmes asks Watson to summon a boy named Cartwright, whom Holmes then orders to check the waste baskets of all the nearby hotels, in search of the newspaper that was used to construct the note. Once Cartwright leaves, Holmes plans to send an inquiry after whomever the cab driver was.
In Chapter III, Dr. Mortimer presents his own interpretation of the facts, thereby leaving Holmes to begin his investigation. For most readers - of Doyle's day and today - this is where the fun begins. And yet, significantly, the gap between Holmes's thought process and what the reader hears is quite large. We do not know what theories Holmes may be entertaining about the case: does he believe in the existence of the dog? Does he think that someone murdered Sir Charles, even though the medical evidence suggests a natural death? Does he believe that someone will murder Sir Henry too? We are only left to understand that Holmes must undergo a long process of solitary reasoning before he shares anything with Watson (and by extension, us).
The question then becomes: what does the reader know about Holmes' method of "deduction"? Is it really scientific? Can we really believe in Holmes's genius? As we work to determine our own theories based on Dr. Mortimer's facts, we also anticipate what alternate approach Holmes will eventually use.
One indication of Holmes's process that is present in Chapter III is his attention to details. What Holmes sees is how various clues are connected to each other. In particular, he is intrigued by the clues which cannot be accounted for. As example, he is most taken by the existence of the "tip-toe" footprints (164). Already, this is his entry point into the case.
However, it is important to note that Holmes is not simply interested in the unexplainable. In other words, he is not intrigued by the suggestion of myth, which would explain the mystery through occult means. Because he refuses to consider that the footprints have a supernatural element, he is able to deduce that Sir Charles was not tip-toeing, but was instead fleeing something. Because he assumes that everything has a rational explanation, he is able to transcend the more simplistic, occult explanations that Dr. Mortimer seems to take for granted.
Holmes's treatment of clues is even more poignant in Chapter IV. His process here indicates his basic approach: he uses an understanding of types - a classification system - to explain the meaning of a particular clue. First, we see his familiarity with typescripts: he can identify to what medium a particular clipping belongs based off of its type. He then follows the trail to deduce the type of person who would read this kind of newspaper.
His next step is to ask Sir Henry if anything else strange has happened. Naturally, Sir Henry did not think enough of the boot to mention it on his own; such small events happen to us all the time. However, Holmes knows that the devil is in the details, that the answer is often in the places we otherwise think meaningless. Instead of judging the boot incident as trivial (as Dr. Mortimer does), Holmes wishes to methodically compare the ordinary to the unusual. In other words, the usual type (both boots remain) is compared to a specific instance (one boot is missing), to determine the reality of the situation.
Put another way, Holmes's method involves using general types to analyze specific incidents. This approach mirrors the scientific theories of Doyle's day, which classified various animal and plant species according to their types. In this way, understanding the class to which something belongs can help Holmes understand more about a particular entity. At the same time, understanding how something differs from its general class allows the observer to determine what specifics comprise clues worthy of consideration.
Chapter IV is notable too because it shows Holmes transitioning from a man of thought to a man of action. While he is able to deduce much from the past, he does not know where his future action will lead. And yet he is equally excited to follow the trail. This reveals another of his methods: he must facilitate the creation of clues, and not simply wait until they come to him. The mystery is very much alive, and he wishes to act as catalyst towards its unfolding.
From this perspective, decisions are extremely important, as they affect how the mystery unfolds. It is notable that Holmes criticizes himself as having approached the situation incorrectly. He regrets that his over-eagerness apprises the bearded man of their suspicions. The active trail must be treated with care if it is to lead to more evidence, meaning that Holmes's brilliance must extend not only to analysis, but to decision-making.
Finally, it is interesting that Holmes acknowledges his adversary's cleverness. For the story to be interesting, the pursued person (here, the man in the cab) must be a match for Holmes. Such a match of intellect is crucial not only for the reader - who wants an interesting story - but also for Holmes himself - who would likely be bored if he did not confront a mystery worthy of his genius.