Vincentio, disguised as Friar Lodowick, counsels Claudio to embrace death as opposed to desperately groping for life, arguing that only by doing so can Claudio prepare himself for what is to come--either life or death--with equanimity when Isabel announces her presence and her intent to have a word with her brother. Friar Lodowick withdraws, and with the Provost’s help he is enabled to eavesdrop on Claudio and Isabel.
Claudio is anxious to know if his sister has found a way to have his sentence commuted. Isabel’s answer is no but she qualifies it, piquing his curiosity. She mentions Angelo’s ignominious proposal, fully expecting her brother to reject the proposal outright only to feel betrayed and let down as her brother begs her to accept the proposal, i.e. sleep with Angelo if that would commute the sentence. Indignant, Isabel denounces Claudio, arguing that she would be doing Claudio a favor by letting the law have its way with him, that death will spare him the shame that would be his living legacy otherwise. She is thus fuming when Friar Lodowick enters and begs to have a word with her. She agrees to and steps aside for a moment while Friar Lodowick tells Claudio that he has overheard what was said between he and and his sister, that Claudio should know Angelo’s proposal was said as a trial of Isabel’s piety, that Angelo had no intention of commuting Claudio’s sentence either way, that Friar Lodowick knows all this to be true because he is Angelo’s confessor, so that Claudio would do well to prepare himself for the inevitable. Ashamed, Claudio begs for a chance to ask his sister for forgiveness
Anon, Friar Lodowick speaks to Isabel.
Praising her virtue, he informs her that he knows of what has transpired between she and Angelo and presents her with an opportunity to do some good which would as a byproduct save her brother’s life without comprising her virtue. Isabel is all ears as Friar Lodowick tells her of Mariana, a woman who was once engaged to marry Angelo. Apparently, Angelo had annulled the engagement, accusing her of an unfounded infidelity when Frederick, Mariana’s brother, miscarried at sea, losing his life as well as his ship which had as its cargo Mariana’s marriage dowry. What Friar Lodowick would have Isabel do is to agree to Angelo’s proposal, making sure that certain conditions are met which conditions would allow Mariana, who is still in love with Angelo, to be put in place of Isabel. Thereby Isabel’s brother’s life will be saved, Isabel’s honor preserved, and Angelo compelled to wed Mariana when it comes to light that he has fornicated with her. Needless to say, Isabel is eager to do her part.
Disguised as Friar Lodowick, Vincentio mingles with the people on the streets of Vienna (presumably to get a sense of the general mood of the populace). He encounters Pompey who is in Elbow’s custody. When told of Pompey’s crimes, Friar Lodowick scolds Pompey for living like an animal. They are joined by Lucio to whom Pompey appeals in vain as a friend who might post him bail. Pompey is led away. Lucio and Friar Lodowick exchange greetings and by and by they strike up a conversation. The topics discussed range from the harshness of the current laws in place (which Lucio and Friar Lodowick respectively disapprove and approve of), to the character and disposition of the absent Duke (which Lucio blasphemes unaware that Friar Lodowick is the Duke himself), and to Claudio’s scheduled execution. At this point, Mistress Overdone who is in the custody of Escalus and the Provost, is seen approaching, prompting Lucio to make a quick getaway. It becomes apparent that she has been ratted out by Lucio, that her bath house is a brothel as Elbow had earlier suspected. Subsequently, Mistress Overdone discloses an act of lechery that Lucio himself has committed, prompting Escalus to have officers seek out Lucio. Mistress Overdone is led away to prison.
Presently, Friar Lodowick and Escalus converse. Friar Lodowick represents himself as cleric sent from Rome, prompting Escalus to ask him about the state of the world outside of Vienna. According to Friar Lodowick, it is a fickle world where virtue is so rare that both friendships and business partnerships are impossible to forge. To a query about the Duke’s character, Friar Lodowick is told that the Duke of Vienna is a mild tempered, introspective man whose absence has created a state of law and justice so absolute as to smack of tyranny. By and by, Escalus leaves to attend to Claudio, leaving Friar Lodowick to contemplate upon his scheme which should rectify the dilemma of which Escalus spoke.