The orphans arrive at the aptly named Lake Lachrymose to meet their widowed Aunt Josephine, a strict grammarian who's haunted by the past.

Klaus and Violet look for clues in a suspicious note that passes custody to Captain Sham, a seafaring scam artist with clear ties to Count Olaf.

The children arrive at the Lucky Smells Lumber Mill and unearth some unsettling accusations about their parents. Count Olaf courts an old flame.