On a tour of the city dump, Tommy Gray and Godfrey walk into the shanty town: "The village of forgotten men." The aromatic stench is from "That's Old Man River - you get used to it after a while." Godfrey points out the ramshackle structure that was "the birthplace of a celebrated butler, Godfrey Smith....[The ashes of Godfrey Park are] scattered to the wind." According to some of his old pals, the shacks are being moved because "the dump trucks are crowdin' in on us a little. We ought to be in the river by early spring." Godfrey heralds the values of the unemployed dump people who are more virtuous than the 'upper-crust' socialites:

Godfrey: That little fellow with the bundle of wood under his arm was Balinger of the Second National. When his bank failed, he gave up everything he had so that his depositors wouldn't suffer...You see, Tommy, there are two kinds of people. Those who fight the idea of being pushed into the river and the other kind.
Tommy: Well, after all, things have always been this way for some people. These men are not your responsibility.
Godfrey: There are different ways of having fun.
Tommy: You have a peculiar sense of humor.
Godfrey: Over here, we have some very fashionable apartment houses. Over there is a very swanky nightclub. While down here, men starve for want of a job. How does that strike your sense of humor?
Tommy: What's all this leading to?
Godfrey: Tommy, there's a very peculiar mental process called thinking. You wouldn't know much about that. But when I was living here, I did a lot of it. One thing I discovered was that the only difference between a derelict and a man is a job.

Off-screen, he describes his regenerative "plan" for the area.

To mark the passage of time, the pages of the Gotham Gossip are opened, and in a column on the first page titled Park Avenue Chatter, the tabloid describes the recent trip to "foreign shores" taken by "The Misses Bullock." Muted trumpets on the soundtrack guffaw at the gossip:

The Misses Bullock have returned from a long sojourn in Europe where the younger daughter, Irene..(So it is rumored) was sent to forget her latest broken engagement. If Park Avenue knew the name of her real beloved, would everybody be leffing. Cupid strikes in strange places, or words to that effect..and heigh-ho..

After spending money for her sojourn, Angelica worries that her daughter "is worse off" than when she left. Cornelia mentions that her upset condition isn't because of a "broken engagement" to Van Rumple but because "Godfrey didn't fall down in a faint when we got in today...He didn't make enough fuss over her homecoming to suit her." Irene consoles herself thinking: "He missed me more than he did you. I could tell by the light in his eyes...He's really in love with me. He's just hard to break down, that's all." And she feels slightly jealous over Cornelia's "unfinished business" and interest in her heart-throb: "Don't you try anything...you'd better leave it unfinished unless you want to be wearing a lamp for a hat!"

In a dish-washing scene with Godfrey at the kitchen sink, Irene appears behind him and swoons toward him: "Did you mean it when you said you missed me?...I mean, did you miss Cornelia and me or just me?" Hungry for affection, Irene - with her typically-daffy stream of consciousness, compliments him: "You look so cute in your apron." After volunteering to help him "wipe" the dishes - a talent she has not cultivated as a rich girl, she tells him her single-minded devotion to him during her European trip: "Every place I went, everybody was Godfrey...when I get in a cab, the driver is Godfrey and I'd say, this is his chariot and he's taking me up to his clouds to his castle on the mountains." In return, Godfrey summarizes the thoughts he's had during her absence, as she erratically brushes water off the plates:

Godfrey: ...I've been doing some things also. I've been trying to do things that I thought would make you proud of me....You helped me to find myself and I'm very grateful.
Irene: You'd make a wonderful husband.
Godfrey: Oh, I'm afraid not. You see, I know how you feel about things...Well, you're grateful to me because I helped you to beat Cornelia and I'm grateful to you because you helped me to beat life, but that doesn't mean that we have to fall in love.
Irene: If you don't want to, but I'd make a wonderful wife.
Godfrey: Not for me, I'm afraid. You see, I like you very much. I had a very bitter experience. But I won't bore you with that...You and I are friends and I feel a certain responsibility to you. And that's why I wanted to tell you first.
Irene (expectantly): Tell me what?
Godfrey: Well, I thought it was about time that I was moving on.

She turns her back to him, crying and struggling to accept his decision to leave the household: "I won't cry, I promise." He consoles her dashed hopes in their love: "After all, I'm your protégé. You want me to improve myself, don't you?..You don't want me to go on just being a butler all my life, do you?"

In the living room, Cornelia speaks to Godfrey about "the Mystery of My Lady's Necklace or What Happened to the Pearls?" and his "upper-crust" roots from the distinguished Parke family in Boston - she threatens to divulge his posturing as a butler: "It would be an awful shame to see them made the laughing-stock of Boston, wouldn't it?" Within purposeful earshot of Irene, she offers to take a "long taxi ride out Van Courtland way. Perhaps we could exchange secrets...I'll be waiting around the corner...It's impossible to exchange intimate secrets here. The traffic's almost as heavy as it is at the Grand Central Station. Don't forget darling, fifteen minutes." Thinking that Godfrey has assented to Cornelia's wiles, Irene begs him: "You can't go with Cornelia...She always gets everybody to do just as she likes." To get his attention, she stages a fainting spell and collapses into his arms.

In one of the film's most well-known sequences, Godfrey hauls the lovesick girl up on his shoulder, bemoaning the insane, anarchic Bullocks: "Oh, this is the craziest family." He carries the limp rag-doll upstairs into her bedroom, dumps her on a bed, and searches for her pulse: "Stop this nonsense, you hear. If you're faking one of your spells to keep me from meeting Cornelia, you're on the wrong track, you hear?" While searching for smelling salts, he realizes that she's faking when she partially sits up (in the mirror's reflection) and then falls faint again. After discovering her ruse ("Godfrey knows how to take care of little Irene, yes indeed"), he deposits her on a stool in the shower and turns on the cold shower, predicting: "In just a minute, you'll forget that you had any troubles. I thought so. Let that be a lesson to you." Soaking wet in her evening gown, Irene skips toward him with hands outstretched, embracing him and exclaiming: "Oh Godfrey, now I know you love me...You do or you wouldn't have lost your temper." Like a mad woman, she bounds toward the door where her mother has appeared, and then skips around the room and jumps up and down on her bed, ecstatic and jubilant: "Oh Mother! Godfrey loves me! He put me in the shower."

It is the perfect opportunity for Godfrey to announce his resignation to a fluttery Angelica. She tells her husband about the butler's confrontation with Irene: "The only thing to do is to send him back where he came from. He never should have come here in the first place. Now imagine falling in love with a butler." Alexander wants to speak about "sordid money matters" with the family - but first has a "little chat" with Carlo. The freeloader is thrown out of the house and told "goodbye" (off-screen amidst the sounds of crashing glass): "He left very hurriedly through the side window."

In a stern lecture, Mr. Bullock announces "point-blank" to his family that the Bullock Enterprises are in dire financial straits:

We're about broke...We've got this house, a few odds and ends, and that's about all. Not only that, I've lost all of my stock in the Bullock Enterprises. And I borrowed some of the stockholder's money trying to recoup my losses. I don't know where I'm gonna end up. Maybe in jail...But if I do end up in jail, it'll be the first peace I've had in twenty years. And I don't want any of ya to chortle about Godfrey. Because you may all end up on the City Dump before we're through.

In a gentlemanly manner, Godfrey steps forward to alleviate Alexander's financial distress, assuring them that he has been slyly saving the company: "I've known for a long time that the Bullock interests were in rather a bad way...So I took the liberty of dabbling in the market on my own account. Here sir...That's most of your stock. I knew it was being dumped on the markets so I sold short..." He explains that he bought the devalued stock in the Bullocks' interest ("The stock has been endorsed over to you") with money from Cornelia's pawned necklace, and had enough left over, after rising profits, for a financial venture of his own. With a short speech, Godfrey expresses his gratitude to all of them:

There comes a turning point in every man's life, a time when he needs help. It happened to me also. Now this family helped me. I hope I repaid my debt. And I may add, some of the money went into a project of my own. I hope you won't mind sir...You see, with the aid of Tommy Gray, I was able to transmute a certain trinket into gold, then into stock, and then into pearls again.

He returns the necklace that he used as collateral to a transformed Cornelia, who humbly admits her crime and her cold viciousness: "If anyone's indebted, we are, after the way some of us have treated you." Before bidding them goodbye, Godfrey recounts the lessons he learned from family members - and teaches a few lessons of his own. His example serves as a catalyst to stir up their privileged lives:

I've been repaid in many ways. I learned patience from Mr. Bullock. I found Mrs. Bullock at all times, shall we say, amusing....(To Cornelia) You taught me the fallacy of false pride. You taught me humility....Miss Cornelia, there have been other spoiled children in the world. I happen to be one of them myself. You're a high-spirited girl. I can only hope that you use those high spirits in a more constructive way. And so, good-day.

At the door as he exits, he kisses a subdued, saddened Molly on the cheek, telling her that she's sweet. When Irene learns from her dumb-struck family that Godfrey has gone, she vows: "He's not going to get away from me." The scene dissolves into a view of the site of the shantytowns and City Dump under the bridge, now transformed into a luxurious and fashionable nightclub, aptly named "The Dump." On the front curb, Mike, one of the former "forgotten man" hobos, is dressed in a white uniform as the club's valet who helps unload cars. In the inner office of the club, Godfrey and business partner Tommy Gray, two benign populist-capitalists, make plans for "steam-heated" apartments ("compartments"): "Forgotten men with steam. Sounds like something that ought to be on the menu....we're giving food and shelter to fifty people in the winter, and giving them employment in the summer." Godfrey decides to sell out his interest in the business for five thousand dollars to build a dock to bring in "the yachting trade."

Pursuing Godfrey into The Dump, Irene greets by name the Mayor (Reginald Mason) who is hosting the many guests at the party. Tommy leaves the office with the final words: "Business is fine. I'm stuck. You're nuts, and I'm going back to Boston before I disgrace my family." Irene bowls her way into the office, mentioning to Godfrey: "It's much nicer than when I was here before...Are the forgotten men having a party?...I saw the Mayor out there, is he one of them too?" She blithely but aggressively announces her intention to remain with him:

Irene: You're my responsibility and someone has to take care of you.
Godfrey: I can take care of myself.
Irene: You can't look me in the eye and say that. You love me and you know it. You know, there's no sense in struggling against a thing when it's got you. It's got you and that's all there is to it. It's got you!

To his surprise, baskets of wood and groceries of food are delivered:

Irene: It should last us for a week, anyway.
Godfrey: It's a wonder you didn't have the foresight to bring a minister and a license.
Irene: It's funny. I never thought of that.

But Tommy Gray has prepared them for the inevitable by summoning the Mayor to perform a civil marriage ceremony for them - without a license: "It may get me into a lot of trouble, but, uh, I guess I've known your family long enough to take a chance." The demanding Irene assures the befuddled Mayor that her hasty marriage to Godfrey is common knowledge to her family: "Everybody knows about it except Godfrey." After Irene places everyone in the correct positions, including a witness, she pulls Godfrey to his feet as the Mayor has them join right hands. She smiles and giggles half-wittedly at her subdued bridegroom - finally triumphant that she has trapped him. Irene suggests that their wedding is a dream:

Stand still, Godfrey, it'll all be over in a minute.