- Sir Charles Baskerville was found dead with a horrible expression on his face after seeing a mysterious demonic spirit of a gigantic hound that has haunted his family. Dr Mortimer visits Sherlock Holmes to save Sir Henry the heir of the Baskerville estate and to solve the mystery of the demonic curse before it's too late.
- Dr James Mortimer (Alastair Duncan) calls on Sherlock Holmes in London for advice after his friend Sir Charles Baskerville (Raymond Adamson) was found dead in the yew alley of his manor on Dartmoor in Devon. The death was due to a heart attack, and that was presented at the subsequent inquest as the only relevant factor, but according to Mortimer, Sir Charles's face retained an expression of horror, and not far from the corpse the footprints of a gigantic hound were clearly visible. According to an old legend, a curse runs in the Baskerville family since the time of the English Civil War (around 1692), when a Hugo Baskerville abducted and caused the death of a maiden on the moor, only to be killed in turn by a huge demonic hound. Allegedly, the same creature has been haunting the manor ever since, causing the premature death of many Baskerville heirs. Sir Hugo's son wrote about this legend in a letter to his future generations in a letter dated Nov 1742. Sir Charles believed in the plague of the hound and so does Mortimer, who now fears for the next in line, Sir Henry Baskerville (Kristoffer Tabori). There are no other claims to the Baskerville estate and Charles's younger brother Roger died in Central America 30 years ago.
Even though he dismisses the curse story as nonsense, Holmes agrees to meet Sir Henry in London as soon as Sir Henry arrives from America, where he has been living. He is a young and jovial good-looking fellow, skeptical toward the grim legend and eager to take possession of Baskerville Hall, even though he has just received an anonymous note in the mail warning him to stay away from the moor. When someone shadows Sir Henry while he is walking down a street, however, Holmes asks Watson to go with the young man and Mortimer to Dartmoor, to protect Sir Henry and search for any clues about who is menacing his life. The Baskerville estate is worth at least one million pounds.
The trio arrives at Baskerville Hall, an old and imposing manor in the middle of a vast park, managed by a butler and his wife the housekeeper Mrs Barrymore (Rosemary McHale). The estate is surrounded by the moor and borders the Grimpen Mire, where animals and humans can sink to their deaths. The news that a convict named Selden (William Ilkley), a murderer, has escaped from the nearby Dartmoor Prison and is hiding in the nearby hills adds to the barren landscape and the gloomy atmosphere. Selden had murdered an entire family with such savagery that they deemed him insane. Mr Barrymore tells Henry that he intends to leave the Baskerville service and go into business on his own.
There are inexplicable events during the first night, keeping the guests awake, and only in the daylight can Watson and Sir Henry relax while exploring the neighborhood and meeting the scattered and idiosyncratic residents of the district. Watson keeps on searching for any lead to the identity of whoever is threatening Sir Henry's life, and faithfully sends the details of his investigation to Holmes (Watson's correspondence to Holmes is being monitored by an unknown person). Among the residents, the Stapletons, brother Jack (James Faulkner) and sister Beryl (Fiona Gillies), stand out: Jack is over-friendly and a bit too curious toward the newly arrived, while Beryl, a rare beauty, seems all too weary of the place and attempts to warn Sir Henry, via Watson, of danger. Beryl begs Watson to return to London at the earliest. Beryl says that Jack wants Henry to stay for the betterment of the poor folks on the moors, but she knows the danger that Henry is in.
Distant howls and strange sightings trouble Watson during his long walks on the hills, and his mood gets no better even inside Baskerville Hall. Watson grows suspicious of the butler, Barrymore, who at night appears to be signaling from a window of the house with a candle to someone on the moor. Henry and Watson follow the light on the moor and come up against a bald man, presumably Selden. When confronted, Mrs Barrymore confirms that Selden is her brother. He is a broken man, and his mind is that of a child. He will be out of the country in a few days, and she begs Henry not to say anything to the police. Henry is sympathetic and gives his clothes to Selden via Barrymore. Meanwhile, Sir Henry is drawn to Beryl, who seems to be afraid of her brother's opinion on the matter. Jack catches Henry and Beryl and loses his cool. Later, he comes to apologize to Henry and even invites him to dinner during the week. Barrymore tells Henry that the night Charles died, he had come out of the mansion to meet a woman. Barrymore found a burnt letter in Charles study and found the initials LL at the end of it.
To make the puzzle even more complex, there is Mortimer, who is all too eager to convince Sir Henry that the curse is real; Frankland Lyons, an old and grumpy neighbor who likes to pry with his telescope into other people's doings; his estranged daughter Laura Lyons (Elizabeth Spender), who had unclear ties to Sir Charles (Mortimer says that after Frankland cut Laura off without a penny, Charles may have been behind getting her a job as typist); and even a bearded man roaming free in the hills and apparently hiding on a tor where ancient tombs have been excavated by Mortimer for an unclear purpose. The bearded man is keeping an eye on Henry and Watson.
Unknown to everyone, even to his friend Watson, Holmes has been hiding on the moor all the time and has solved the mystery. He was the one who took all of Watson's mail from the post office. He reveals that the hound is real and belongs to Jack Stapleton, who Laura is attracted (Jack promised Laura to help with finances to arrange her divorce with her husband) to and who convinced her to lure Sir Charles out of his house by night, to frighten him with the apparition of the legendary hound. Beryl is indeed Jack's legitimate wife, forced into posing as his sister to expose Sir Henry to the fangs of the hound, since Jack Stapleton is in fact a descendant of the Baskervilles wanting to claim their inheritance. Meanwhile, the hound is set on to a man thought to be Sir Henry, but Barrymore had given the former's clothes to Selden, his brother-in-law, who dies in his place.
Unfortunately, the collected evidence is not enough for a jury to condemn Stapleton, so Holmes decides to use Sir Henry Baskerville as bait to catch the criminal red-handed. Sir Henry will accept an invitation to Stapleton's house (the dinner invitation from Jack) and will walk back alone after dark, giving his enemy every chance to unleash the hound on him. Holmes and Watson pretend to leave Dartmoor by train, but instead, they hide near Stapleton's house with Inspector Lestrade of Scotland Yard. Despite the dark and a thick fog, Holmes and Watson kill the fearsome beast as soon as it attacks the intended victim, while Stapleton, in his panicked flight from the scene, is presumed to drown in the mire.
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