Violet, Klaus, and Sunny Baudelaire are enjoying a gray day at the beach, when a banker named Mr. Poe approaches them with some horrible news: Their parents have died in a tragic fire. Oh no. Their entire home has been destroyed, but Mr. Poe promises to find them a new guardian and to watch over the enormous fortune that their parents left behind. Sounds good so far.
Mr. Poe ends up taking the children to live with Count Olaf—a distant relative whom the kids have never heard of. It's pretty obvious right away that Count Olaf is not even close to being a suitable guardian for the Baudelaire children—not only is his house dilapidated and dirty, he makes it clear that he has only taken in the orphans to get his hands on the Baudelaire fortune. Even though Count Olaf has only given them one bed to share and a cardboard box to keep all their clothes in, the kids make friends with his neighbor, Justice Strauss, so life isn't all bad—just mostly.
One day, Count Olaf demands that the children make dinner for his theater troupe. He's not satisfied with the meal they prepare, though, and ends up slapping Klaus across the face before the end of the night. Ouch! When the children go to see Mr. Poe the next day, he's much too busy working on his bank to help them escape the clutches of this madman.
The next day, when Count Olaf insists that the children perform in his upcoming theatrical—Violet will play the part of the bride and marry Count Olaf on stage—they just know he's up to something. After searching through law books in Justice Strauss's library, Klaus discovers that Count Olaf plans to actually marry Violet during the show. Creepy.
He confronts Count Olaf with this information, but when he does, he finds that the villain has kidnapped Sunny and hung her from a cage on top of a tall tower. If Violet doesn't go through with the marriage tomorrow night, then he'll have Sunny dropped to her death. Eek.
Though Violet tries to rescue her baby sister, it's no use. The next night at the play, both Mr. Poe and Justice Strauss are present, but the kids aren't able to explain to either of them what is happening and Violet is forced to marry Count Olaf during the third act. After Violet signs a marriage document "in her own hand," per the legal requirement, Count Olaf stops the show and reveals to the audience that his dastardly plot has succeeded: He's married Violet and can now legally control her fortune. Mwah ha ha ha…
Ah, but not so fast—Violet reveals that she didn't actually sign the document in "her own hand," since she's right-handed, but used her left to make her signature. Count Olaf is furious that his evil plan has been foiled. His associate turns out the lights in the theater and Count Olaf is able to escape in the darkness, but not before swearing that he'll get his hands on the Baudelaire fortune if it's the last thing he does.
In the end, Justice Strauss offers the Baudelaires a place to live, but Mr. Poe insists that they live with a relative per the instructions in their parents' will. The story ends with the children driving off to an uncertain future with a new, and hopefully less evil, guardian.