As Mr. Poe prepares to hand the Baudelaires over to "Captain Sham", the siblings discover the note has several grammatical errors, something Josephine would never do since she was obsessed with proper grammar. Mr. Poe takes the children to a restaurant and prepares to complete the transfer, but allows the siblings to leave after Larry, a waiter intimidated by Sham, triggers their allergy to peppermint.
After returning to the house, the siblings decipher Josephine's suicide note and discover she is still alive moments before a hurricane sends the house teetering over the cliff. Escaping with a photograph of their parents standing in front of a lumber mill, the siblings find Josephine at a nearby cave only to be confronted by Olaf, who abandons Josephine to be eaten alive by the leeches that inhabit Lake Lachrymose.
Upon returning to shore, Olaf escapes after being unmasked in front of Mr. Poe while the Baudelaires sneak away and set out to find the lumber mill in the photograph.
