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In a public place in Vienna, Lucio and two Gentlemen talk about world politics and religion while trading light hearted insults about which one of them may or may not have syphilis.
Mistress Overdone, the local bawd (she runs a brothel) enters and Lucio says something like "Speaking of STDs, I've certainly paid for my share of venereal diseases at Mistress Overdone's business establishment."
As more STD jokes ensue, Mistress Overdone spots a prisoner being paraded through the streets. She recognizes Claudio and brags how she saw him get arrested and knows for a fact that he's going to be sentenced to death (by decapitation) within three days.
Overdone explains that Claudio's been busted for getting Juliet pregnant.
Lucio and the Gentlemen run off to find out all the dirt.
Mistress Overdone complains that business at the brothel is slow, what with "the war," the bubonic plague, the lousy economy, and the rate at which her clients are being thrown in jail and all. There just aren't enough customers anymore.
Pompey enters and announces there's more bad news for Mistress Overdone: Angelo has ordered that all the brothels in the suburbs of Vienna be torn down.
We interrupt this program for a brain snack: In Shakespeare's England, most of the brothels were located in the "suburbs" because it was harder for the authorities to regulate them outside the city limits. In April of 1604, King James I ordered all the tenements and houses in the suburbs be torn down to prevent the spread of the plague, which killed 36,000 people in 1603 (source).
When Overdone gets upset, Pompey tells her to calm down – she can always hire an attorney and, plus, she can move her business somewhere else and her clients will follow.
Pompey makes a dirty joke about Mistress Overdone's many years of devoted "service" in the sex industry and tells her to cheer up.
Overdone and Pompey exit and the scene shifts to a conversation between Claudio and the Provost (a prison keeper).
Claudio wines about being taken to prison and publicly humiliated.
The provost says he's just doing his job. If Claudio wants to blame someone, he should blame Angelo, who's in charge while the Duke's away.
Lucio arrives and asks what's up.
Claudio says he's been arrested because he's a kind of glutton. He then goes on to compare having sex to drinking rat poison. Both activities, says Claudio, lead to death. (Yikes!)
Once again, Lucio asks why Claudio has been arrested. Did Claudio murder someone, or what?
Claudio says he went to bed with Juliet and explains why: "she is fast my wife, / Save that we do the denunciation lack / Of outward order."
Brain Snack: What the heck does this mean? Well, some literary critics think that Claudio and Juliet have made a marriage contract but haven't had a religious ceremony (required by the Church) to seal the deal. In seventeenth-century England, a marriage contract was considered legal under common law if the bride and groom got together in front of witnesses and said "I marry you." The circumstances of Claudio's Juliet are a little fuzzy here so we're not sure if it was actually legal. It also seems like Shakespeare made this issue unclear on purpose. Now, back to the play.
Claudio adds that they haven't yet had made a public announcement because they were waiting for Juliet's relatives to cough up a dowry.
History Snack: A dowry is the money, goods, and/or land that a woman brings to the marriage. It becomes her husband's property once the couple is married.
Lucio correctly guesses that Juliet is pregnant.
Claudio explains how it's illegal to fornicate (have sex outside of marriage) in Vienna, but, for the past several years, the Duke has never enforced this law. Claudio suggests that Angelo is just flexing his muscles because he's the new guy in charge.
Lucio suggests petitioning the Duke but Claudio explains that the guy is nowhere to be found.
Claudio sends Lucio find his, Claudio's sister, at the nunnery. She's about to become a "novice" (an almost-nun who is still in her probationary period). Claudio wants her to plead with Angelo on his behalf. If anyone can make Angelo change his mind, it's Claudio's virginal sister.